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Minnesota Legislature

Office of the Revisor of Statutes

9549.0020 DEFINITIONS.

Subpart 1.

Applicability.

As used in parts 9549.0010 to 9549.0080 the following terms have the meanings given them.

Subp. 2.

[Repealed, L 2014 c 262 art 4 s 9]

Subp. 3.

Addition.

"Addition" means an extension, enlargement, or expansion of the nursing facility for the purpose of increasing the number of licensed beds or improving resident care.

Subp. 4.

Applicable credit.

"Applicable credit" means a receipt or expense reduction as a result of a purchase discount, rebate, refund, allowance, public grant, beauty shop income, guest meals income, adjustment for overcharges, insurance claims settlement, recovered bad debts, or any other adjustment or income reducing the costs claimed by a nursing facility.

Subp. 5.

Appraised value.

"Appraised value" means the value of the nursing facility buildings, attached fixtures, and land improvements used directly for resident care as determined under part 9549.0060.

Subp. 6.

Attached fixtures.

"Attached fixtures" means equipment used directly for resident care affixed to the building and not easily movable as specified in the fixed equipment table of the depreciation guidelines.

Subp. 7.

Buildings.

"Buildings" means the physical plant used directly for resident care and licensed under Minnesota Statutes, chapter 144A or Minnesota Statutes, sections 144.50 to 144.56, and auxiliary buildings in the nature of sheds, garages, and storage buildings located on the site if used directly for resident care. This definition does not include buildings or portions of buildings used by central, affiliated, or corporate offices.

Subp. 8.

Building capital allowance.

"Building capital allowance" means the component of the property-related payment rate which is denominated as a payment for the use of buildings, attached fixtures, and land improvements.

Subp. 9.

Capital assets.

"Capital assets" means a nursing facility's buildings, attached fixtures, land improvements, depreciable equipment, leasehold improvements, and all additions to or replacements of those assets used directly for resident care.

Subp. 10.

Commenced construction.

"Commenced construction" means the date on which a newly constructed nursing facility, or nursing facility with an increase in licensed beds of 50 percent or more, meets all the following conditions:

A.

The final working drawings and specifications were approved by the commissioner of health.

B.

The construction contracts were let.

C.

A timely construction schedule was developed, stipulating dates for beginning, achieving various stages, and completing construction.

D.

All zoning and building permits have been issued.

E.

Financing for the project was secured as evidenced by the issuance of a binding letter of commitment by the financial institution, sale of bonds, or other similarly binding agreements.

Subp. 11.

Commissioner.

"Commissioner" means the commissioner of the Minnesota Department of Human Services.

Subp. 12.

[Repealed, L 2014 c 262 art 4 s 9]

Subp. 13.

[Repealed, L 2014 c 262 art 4 s 9]

Subp. 14.

Deletion.

"Deletion" means the sale, destruction, or dismantling of a nursing facility capital asset or a portion of a nursing facility capital asset without subsequent replacement.

Subp. 15.

Department.

"Department" means the Minnesota Department of Human Services.

Subp. 16.

Depreciated replacement cost method.

"Depreciated replacement cost method" means the method of property appraisal which determines the value of a capital asset by establishing the replacement cost new reduced by depreciation. As used in this subpart and part 9549.0060:

A.

"Replacement cost new" means the amount required to obtain a new asset of equivalent utility to that which exists, but built at current prices, with modern materials and according to current standards, designs, and layout.

B.

"Depreciation" means a loss of utility and hence value caused by deterioration or physical depreciation such as wear and tear, decay, dry rot, cracks, encrustations, or structural defects; and functional obsolescence such as poor plan, mechanical inadequacy or overadequacy, and functional inadequacy or overadequacy due to size, style, or age.

Subp. 17.

Depreciable equipment.

"Depreciable equipment" means the standard movable care equipment and support service equipment generally used in nursing facilities. Depreciable equipment includes that equipment specified in the major movable equipment table of the depreciation guidelines.

Subp. 18.

Depreciation guidelines.

"Depreciation guidelines" means "The Estimated Useful Lives of Depreciable Hospital Assets," issued by the American Hospital Association, 840 North Lake Shore Drive, Chicago, Illinois 60611 (Chicago: 1983). Except as provided in Minnesota Statutes, section 144A.071, subdivision 1a, paragraph (h), the useful lives in the depreciation guidelines must not be used in the determination of the total payment rate. The depreciation guidelines are incorporated by reference and are available for reference at the Minnesota State Law Library, 25 Rev. Dr. Martin Luther King Jr. Blvd., Saint Paul, Minnesota 55155.

Subp. 19.

Desk audit.

"Desk audit" means the establishment of the payment rate based on the commissioner's review and analysis of required reports, supporting documentation, and work sheets submitted by the nursing facility.

Subp. 20.

[Repealed, L 2014 c 262 art 4 s 9]

Subp. 21.

Equipment allowance.

"Equipment allowance" means the component of the property-related payment rate which is denominated as a payment for the use of depreciable equipment.

Subp. 22.

Field audit.

"Field audit" means the on-site examination, verification, and review of the financial records, statistical records, and related supporting documentation of the nursing facility and any related organization.

Subp. 23.

[Repealed, L 2014 c 262 art 4 s 9]

Subp. 24.

[Repealed, L 2014 c 262 art 4 s 9]

Subp. 25.

[Repealed, L 2014 c 262 art 4 s 9]

Subp. 26.

[Repealed, L 2014 c 262 art 4 s 9]

Subp. 27.

[Repealed, L 2014 c 262 art 4 s 9]

Subp. 28.

Land improvement.

"Land improvement" means an improvement to the land surrounding the nursing facility directly used for resident care as specified in the land improvements table of the depreciation guidelines, if replacement of the land improvement is the responsibility of the nursing facility.

Subp. 29.

Medical assistance program.

"Medical assistance program" means the program which reimburses the cost of health care provided to eligible recipients pursuant to Minnesota Statutes, chapter 256B and United States Code, title 42, section 1396 et seq.

Subp. 30.

[Repealed, L 2014 c 262 art 4 s 9]

Subp. 31.

[Repealed, L 2014 c 262 art 4 s 9]

Subp. 32.

[Repealed, L 2014 c 262 art 4 s 9]

Subp. 33.

[Repealed, L 2014 c 262 art 4 s 9]

Subp. 34.

[Repealed, L 2014 c 262 art 4 s 9]

Subp. 35.

[Repealed, L 2014 c 262 art 4 s 9]

Subp. 36.

[Repealed, L 2014 c 262 art 4 s 9]

Subp. 37.

Real estate taxes and special assessments.

"Real estate taxes and special assessments" means the real estate tax liability shown on the annual property tax statement of the nursing facility for the calendar year during which the rate year begins and the actual special assessments and related interest paid during the reporting year. The term does not include personnel costs or fees for late payment.

Subp. 38.

[Repealed, L 2014 c 262 art 4 s 9]

Subp. 39.

Repair.

"Repair" means the cost of labor and materials needed to restore an existing capital asset to sound condition after damage or malfunction or to maintain an existing capital asset in a usable condition.

Subp. 40.

Replacement.

"Replacement" means a renovation or substitution of an existing capital asset to improve its function or extend its useful life.

Subp. 41.

[Repealed, L 2014 c 262 art 4 s 9]

Subp. 42.

[Repealed, L 2014 c 262 art 4 s 9]

Subp. 43.

[Repealed, L 2014 c 262 art 4 s 9]

Subp. 44.

[Repealed, L 2014 c 262 art 4 s 9]

Subp. 45.

Useful life.

"Useful life" means the length of time an asset is expected to provide economic service before needing replacement.

Subp. 46.

[Repealed, L 2014 c 262 art 4 s 9]

Subp. 47.

[Repealed, L 2014 c 262 art 4 s 9]

Subp. 48.

Working capital debt.

"Working capital debt" means debt incurred to finance nursing facility operating costs. Working capital debt does not include debt incurred to acquire or refinance a capital asset.

Subp. 49.

Working capital interest expense.

"Working capital interest expense" means the interest expense incurred on working capital debt during the reporting year.

Statutory Authority:

MS s 256B.41 to 256B.502

History:

9 SR 2659; L 1992 c 513 art 7 s 136; L 2014 c 262 art 4 s 9; art 5 s 6

Published Electronically:

October 21, 2014