§ 2808. Residential health care facilities; rates of payment.

1-a. Notwithstanding sections one hundred twelve and one hundred sixty-three of the state finance law and any other inconsistent provision of law, the commissioner shall make grants to public residential health care facilities without a competitive bid or request for proposal process for the purposes of addressing the overall increases in input costs borne by such facilities. Such modifications shall also be primarily intended to promote the provision of quality health care, quality operation, updated technology and improved staff development and support by such facilities. Such grants shall be in the following aggregate amounts for the following periods: five million for the period April first, two thousand six through March thirty-first, two thousand seven; fifteen million for the period April first, two thousand seven through March thirty-first, two thousand eight; and ten million for the period April first, two thousand eight through March thirty-first, two thousand nine.

The amount allocated to each eligible public residential health care facility for each period shall be calculated as the result of (i) the total payment for each period multiplied by (ii) the ratio of patient days for patients eligible for medical assistance pursuant to title eleven of article five of the social services law provided by the public residential health care facility, divided by the total of such patient days summed for all eligible public residential health care facilities. Grants under this subdivision shall be made on a quarterly basis.

* 2. (a) The commissioner, with the approval of the state hospital review and planning council, shall promulgate regulations to be effective the first day of January, nineteen hundred seventy-eight, relating the rate of payment for each residential health care facility to real property costs.

(b) Such regulations may differentiate based upon the form of ownership of the facility, and shall provide for consideration of such factors as the age, size, location and condition of the facility.

(c) For facilities granted operating certificates prior to March tenth, nineteen hundred seventy-five, the real property costs shall be computed upon a cost valuation basis of the facility as determined by the commissioner, who, subject to the approval of the director of the budget, may provide exceptions in circumstances where he finds that application of the regulations would result in excessive reimbursement or in severe economic hardship to the facility not caused by circumstances reasonably under the control of the facility.

(d) For facilities granted operating certificates on or after March tenth, nineteen hundred seventy-five, recognition of real property costs in such regulations shall be based upon historical costs to the owner of the facility, provided that payment for real property costs shall not be in excess of the actual debt service, including principal and interest, and payment with respect to owner’s equity. For purposes of this subdivision, owner’s equity shall be calculated without regard to any surplus created by revaluation of assets and shall not include amounts resulting from mortgage amortization where the payment therefor has been provided by real property cost reimbursement.

(e) All transactions, including leases and mortgages, which are not bona fide and reasonable shall be disregarded.

* NB Expired December 31, 1978

2-a. (a) The commissioner, with the approval of the state hospital review and planning council, shall promulgate regulations to be effective the first day of January, nineteen hundred seventy-nine, relating the rate of payment for each residential health care facility to real property costs.