Senate Bill S7411

                                 BILL NUMBER:  S7411

 TITLE OF BILL :
An act to amend the public health law, in relation to real property
capital construction costs


 PURPOSE :
To enhance the ALP rates to include the cost of new capital
construction for any facility which commenced operations after
December thirty first two thousand nine.

 SUMMARY OF PROVISIONS :
Section is an addition as subdivision 6-c of section 3614 of the
public health law.

 JUSTIFICATION :
The New York State Department of Health has been in the process of
eliminating approximately 6,000 nursing home beds from the statewide
bed total. Through different projects, this target has not been met.
Currently, approximately one third of the counties in the state have
no operational ALP beds or an extraordinarily low number of ALP beds
relative to other counties. Between the Burger Commission
recommendations and the 1584 bed ALP application, DOH is trying to add
over 1,800 new ALP beds statewide.  The basis of the Burger Commission
recommendations was to eliminate under utilized health care beds in
              

different regions of the State and/or replace those beds with a lower
operating cost bed. Also, the HEAL-12 project utilized the same theory
of replacing/closing more expensive nursing home beds for less
expensive ALP beds.

With New York State trying to reduce the overall cost of Medicaid
throughout the State, fiscally sensible projects have not met these
targets. Approval of this amendment, opens different regions to be
enhanced to convert nursing home beds for ALP beds.

The current capital construction cost enhancement to the regionally
based ALP rates 3614(6) (b) are restrictive to not for profit programs
in counties with a population greater than two hundred eighty thousand
persons. This amendment opens the criteria of consideration of
proprietary sponsorship and other counties which do not meet the
population requirement. Also, with the Burger Commission
recommendations, buildings which contained all nursing home beds that
were designated for conversion did not qualify to the 95 percent of
certified bed requirement.

Therefore, this additional paragraph to Article 3614(6) will enhance
the probability of converting nursing home beds to ALP beds, still
achieve an overall cost savings to the State and add a maximum
allowable construction cost bed limit similar to nursing homes which
was not included in 3614(6) (b).  With an effective date of April
first two thousand ten for any program which commenced operations
December thirty first two thousand nine, it limits this rate
enhancement only to new programs.

The cost of capital construction cost and any related mortgage
interest, will be allocated over the useful life of the building with
cost savings from the conversion of nursing home beds to ALP beds
achieved immediately.

 LEGISLATIVE HISTORY :
None.

 FISCAL IMPLICATIONS :
To be determined with the goal of overall state savings.

 EFFECTIVE DATE :
Immediately.