(a) Pediatric Care Facility Class. The purpose of this special class is to recognize, through the adoption of a special payment rate, the cost differences that exist in a pediatric nursing facility or distinct unit of a nursing facility that serves predominantly children.
(b) Definitions. The following terms, when used in this section, have the following meanings, unless otherwise stated.
  (1) Children--For the purposes of this pediatric care facility class, children are defined as being at or below 22 years of age.
    (A) Only a pediatric care facility that is designated in its entirety as a pediatric care facility may count as children a limited number of adults who were admitted to the facility as children, but who are no longer children (i.e., individuals who have "aged in place"), for purposes of determining if the facility meets the requirements for remaining a pediatric care facility described in paragraph (3) of this subsection. The number of such individuals who may be counted as children for purposes of determining if the facility continues to meet the requirements for remaining a pediatric care facility is limited to 33 percent of the average daily census of the facility.
    (B) Individuals who have "aged in place" as described in subparagraph (A) of this paragraph may not be counted toward meeting the requirements for a facility to initially become a pediatric care facility, nor can they be counted toward meeting the requirements for a distinct unit to remain a pediatric care facility.
  (2) Distinct unit--A portion of a nursing facility that is physically separate from, and beds are not commingled with, other units of the facility. The distinct unit can be an entire wing, a separate building, an entire floor, or an entire hallway. The distinct unit consists of all beds within the designated area. A distinct unit must consist of 28 or more Medicaid-contracted beds.
  (3) Pediatric care facility--Except as provided in paragraph (1) of this subsection, a pediatric care facility is an entire facility that has maintained an average daily census of 80 percent or more children for the six-month period prior to its entry into the pediatric care facility class based on the entire licensed facility. A pediatric care facility can also be a distinct unit of a facility that has maintained an average daily census of 85 percent or more children for the six-month period prior to its entry into the pediatric care facility class based on the distinct unit of the facility. To remain a pediatric care facility, the pediatric care facility must maintain an average daily census of 80 percent or more children if the pediatric care facility is an entire facility, and 85 percent or more children if the pediatric care facility is a distinct unit of the facility. The contracted provider must request in writing by certified mail or by special mail delivery where the delivery can be verified to become a member of the pediatric care facility special reimbursement class. The request must be sent to the Texas Health and Human Services Commission (HHSC) Provider Finance Department.
(c) Payment rate determination. Payment rates will be determined in the following manner.
  (1) Cost reports for pediatric care facilities are governed by the requirements specified in Subchapter A of this chapter (relating to Cost Determination Process). A nursing facility that contains a pediatric care facility distinct unit must complete two cost reports: one report for the distinct pediatric care facility unit and one report for the remainder of the facility.
  (2) The payment rate methodology for this class of service is based upon the unadjusted federal per diem rate for rural Medicare skilled nursing facilities for the most recent federal fiscal year as published in the Federal Register. Payment rates are based on available funds and are subject to legislative appropriations.
  (3) The payment rate described in paragraph (2) of this subsection will be paid for all Medicaid residents of a qualifying pediatric care facility.
  (4) A facility will not be eligible to receive the ventilator-dependent or the children-with-tracheostomies supplemental reimbursements.
  (5) Pediatric care facilities are not eligible to participate in §355.308 of this subchapter (relating to Direct Care Staff Rate Component).
(d) Disqualification. If HHSC determines that a pediatric care facility that is designated in its entirety as a pediatric care facility no longer qualifies as a member of such class according to subsection (b) of this section, HHSC will notify the facility in writing.
  (1) Within 30 calendar days of the date on the written notification, the HHSC Provider Finance Department must receive a written compliance plan from the facility as described in paragraph (2) of this subsection. If the 30th calendar day is a weekend day, national holiday, or state holiday, the first business day following the 30th calendar day is the final day receipt of the plan will be accepted.
  (2) The compliance plan must indicate the facility's intent to, within 180 calendar days of the date of HHSC's initial written notification to the facility, come into compliance with subsection (b) of this section by:
    (A) managing a sufficient number of admissions and discharges to come into compliance with the requirements of subsections (b)(1) and (b)(3) of this section to remain a member of the pediatric care facility special reimbursement class;
    (B) creating a distinct unit of the facility as described under subsection (b)(2) of this section; or
    (C) withdrawing the entire facility from the pediatric care facility special class.
  (3) HHSC will make a written determination regarding approval or disapproval of the compliance plan. A facility that submits a compliance plan that is subsequently disapproved will no longer be reimbursed as a member of the pediatric facility special class on the first day of the month following HHSC's disapproval of the compliance plan.
  (4) A compliance plan that is received after the stated deadline will not be accepted, and the facility will be removed from the pediatric care facility special reimbursement class retroactive to the first day of the month following the date of HHSC's initial written notification to the facility.
  (5) A facility that obtains approval of its compliance plan from the HHSC Provider Finance Department will continue to be reimbursed as a member of the pediatric care special class until 180 calendar days from the date of HHSC's initial written notification to the facility. If the facility has not achieved the stated goal of its compliance plan by that time, the facility will be removed from the pediatric care special class effective the first day of the following month.
  (6) If, at any time, HHSC determines that a facility that has come into compliance with subsection (b) of this section by managing a sufficient number of admissions and discharges, as described in paragraph (2)(A) of this subsection, no longer qualifies as a member of the pediatric care facility special reimbursement class, that facility will be excluded from the class for 365 days from the date HHSC makes its determination. The facility may request to rejoin the class on the 366th day.
  (7) A facility that is removed or withdraws from the pediatric care special reimbursement class will be considered a new facility, as described in §355.308(e) of this title, for purposes of enrollment in the Nursing Facility Direct Care Staff Rate Enhancement.
  (8) A facility that is removed or withdraws from the pediatric care special class may not re-enter the class within one year of its removal or withdrawal.

Source Note: The provisions of this §355.316 adopted to be effective October 19, 2021, 46 TexReg 7039