SB2245 104TH GENERAL ASSEMBLY

LRB104 09201 KTG 19258 b

104TH GENERAL ASSEMBLY
State of Illinois
2025 and 2026
SB2245

Introduced 2/7/2025, by Sen. Lakesia Collins

SYNOPSIS AS INTRODUCED:

305 ILCS 5/5-5.2a new

Amends the Medical Assistance Article of the Illinois Public Aid Code. Provides that for the calendar year beginning January 1, 2026, and each calendar year thereafter, a nursing facility must spend at least 90% of its adjusted total revenue on resident care and other resident-related costs, as defined. Requires each nursing facility to provide as part of its financial reporting information necessary for the Department of Healthcare and Family Services to administer and enforce the provisions of the amendatory Act. Provides that such information shall be subject to audit provisions and comply with any applicable uniform standards under the Code. Provides that all non-allowable costs, related party adjustments, or compensation to owners reported shall be excluded from the calculation of the amount spent on resident care and other resident-related costs. Requires 25% of costs associated with contract nursing staff to be deducted from the amount spent on resident care and other resident-related costs. Provides that for the calendar year beginning January 1, 2027, and each calendar year thereafter, the Department shall use the required financial reporting submissions to determine whether each nursing facility has met the minimum resident care percent requirement. Provides that if a facility has not met the minimum resident care percent requirement, the amount defined by the facility's total adjusted revenue shall be treated as a vendor overpayment. Requires the Department to recover the full amount of any vendor overpayment by reducing future payments, requiring direct payment to the Department, or any other method permitted under the Code. Requires the Department to adopt rules.

A BILL FOR

AN ACT concerning public aid.

Be it enacted by the People of the State of Illinois, represented in the General Assembly:

Section 5. The Illinois Public Aid Code is amended by adding Section 5-5.2a as follows:

(305 ILCS 5/5-5.2a new)

Sec. 5-5.2a. Minimum resident care requirement for nursing facility payments.

(a) For the calendar year beginning January 1, 2026, and each calendar year thereafter, a nursing facility must spend at least 90% of its adjusted total revenue on resident care and other resident-related costs. For purposes of this Section, "resident care and other resident-related costs" means the direct care provided to a facility resident by a nurse, certified nurse aide, or certified nurse assistant; support services, including food service, laundry, housekeeping, nurse administration, activity programs, social services, and transportation, as identified in reports required by the Department; and ancillary program services, including medical, dental, podiatric, and laboratory services, inhalation, and other physical, mental, or occupational therapeutics, as identified in reports required by the Department. "Resident care and other resident-related costs" does not include administrative costs (other than nurse administration), capital costs, debt service, taxes (other than sales taxes or payroll taxes), capital depreciation, rent and leases, and fiscal services. Resident care and other resident-related costs are subject to exclusions and subtractions under paragraph (c).

For purposes of this Section, "adjusted total revenue" consists of the total operating revenue of a nursing facility plus interest or other investment income and excluding CNA tenure payments under paragraph (2) of subsection (l) of Section 5-5.2.

(b) Each nursing facility shall provide as part of its financial reporting under Sections 5-5.7 and 5B-5 information necessary for the Department to administer and enforce the provisions of this Section. Information provided shall be subject to audit provisions and comply with any uniform standards developed under Section 5-5.7.

(c) All non-allowable costs, related party adjustments, or compensation to owners reported shall be excluded from the calculation of the amount spent on resident care and other resident-related costs. To the extent that the value of any related party transaction is greater than fair market value, such related party cost shall be deducted from the amount spent on resident care and other resident-related costs. 25% of costs associated with contract nursing staff shall be deducted from the amount spent on resident care and other resident-related costs. CNA tenure payments under paragraph (2) of subsection (l) of Section 5-5.2 shall be deducted from the amount spent on resident care and other resident-related costs.

(d) For the calendar year beginning January 1, 2027, and each calendar year thereafter, the Department shall use the required financial reporting submissions to determine whether each nursing facility has met the minimum resident care percent requirement. A facility's resident care and other resident-related costs divided by the facility's adjusted total revenue must be greater than 0.9.

(e) If a facility has not met the minimum resident care percent requirement, the amount defined by the facility's total adjusted revenue multiplied by 0.9 minus the facility's resident care and other resident-related costs, divided by the facility's total adjusted revenue and multiplied by the facility's total adjusted revenue from the medical assistance program, shall be treated as a vendor overpayment under this Code. The Department shall recover the full amount of any vendor overpayment under this Section by reducing future payments, requiring direct payment to the Department, or any other method permitted under this Code.

(f) The Department shall adopt any rules necessary to administer the provisions of this Section.