This section requires an annual patient care expense ratio for certain nursing facility reimbursement and limits when the commission can recoup payments.
Sec. 32.0286. ANNUAL PATIENT CARE EXPENSE RATIO FOR REIMBURSEMENT OF CERTAIN NURSING FACILITY PROVIDERS. (a) In this section, "patient care expense": (1) includes an expense incurred by a nursing facility for: (A) providing compensation and benefits to: (i) direct care staff of a facility, whether the staff are employees of or contract labor for the facility, including: (a) licensed registered nurses and licensed vocational nurses, including directors of nursing and assistant directors of nursing; (b) medication aides; (c) restorative aides; (d) nurse aides who provide nursing-related care to residents occupying medical assistance beds; (e) licensed social workers; and (f) social services assistants; (ii) additional staff associated with providing care to facility residents with a severe cognitive impairment; (iii) nonprofessional administrative staff, including medical records staff and accounting or bookkeeping staff; (iv) central supply staff and ancillary facility staff; (v) housekeeping staff and laundry staff; and (vi) food service staff; (B) central supply costs and ancillary costs for facility services and supplies, including: (i) diagnostic laboratory and radiology costs; (ii) durable medical equipment costs, including costs to purchase, rent, or lease the equipment; (iii) costs for oxygen used to provide oxygen treatment; (iv) prescription and nonprescription drug costs; and (v) therapy consultant costs; and (C) costs for dietary and nutrition services, including costs for: (i) food service and related supplies; and (ii) nutritionist services; and (2) does not include an expense for: (A) administrative or operational costs, other than administrative or operational costs described by Subdivision (1); or (B) fixed capital asset costs. (b) The executive commissioner by rule shall establish an annual patient care expense ratio, including a process for determining the ratio, applicable to the reimbursement of nursing facility providers for providing services to recipients under the medical assistance program. In establishing the ratio, the executive commissioner shall require that at least 80 percent of the portion of the medical assistance reimbursement amount paid to a nursing facility that is attributable to patient care expenses is spent on reasonable and necessary patient care expenses. (c) The executive commissioner shall adopt rules necessary to ensure each nursing facility provider that participates in the medical assistance program complies with the patient care expense ratio adopted under this section. (d) Except as provided by Subsection (e) and to the extent permitted by federal law, the commission may recoup all or part of the medical assistance reimbursement amount paid to a nursing facility that is subject to the patient care expense ratio under this section if the facility fails to spend the reimbursement amount in accordance with the patient care expense ratio. (e) The commission may not recoup a medical assistance reimbursement amount under Subsection (d) if, during the period patient care expenses attributable to the reimbursement amount are calculated, the facility: (1) held at least a four-star rating under the Centers for Medicare and Medicaid Services five-star quality rating system for nursing facilities in three or more of the following categories: (A) overall; (B) health inspections; (C) staffing; and (D) long-stay quality measures; (2) both: (A) maintained an average daily occupancy rate of 75 percent or less; and (B) spent at least 70 percent of the portion of the reimbursement amount paid to the facility that was attributable to patient care expenses on reasonable and necessary patient care expenses; or (3) incurred expenses related to a disaster for which the governor issued a disaster declaration under Chapter 418, Government Code. (f) The commission shall publish and maintain on the commission's Internet website a list of all nursing facilities from which the commission recouped medical assistance reimbursement amounts under Subsection (d). (g) The commission may not require a nursing facility to comply with the patient care expense ratio as a condition of participation in the medical assistance program. (h) This section does not apply to a state-owned facility. Added by Acts 2025, 89th Leg., R.S., Ch. 1135 (S.B. 457), Sec. 6, eff. September 1, 2025.