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Virginia Administrative Code
Title 12. Health
Agency 30. Department of Medical Assistance Services
Chapter 90. Methods and Standards for Establishing Payment Rates for Long-Term Care
11/21/2024

12VAC30-90-50. Allowable costs.

Article 5
Allowable Cost Identification

A. Costs which are included in rate determination procedures and final settlement shall be only those allowable, reasonable costs which are acceptable under the Medicare principles of reimbursement, except as specifically modified in the Plan and as may be subject to individual or ceiling cost limitations and which are classified in accordance with the DMAS uniform chart of accounts (see Appendix I (12VAC30-90-270 through 12VAC30-90-276) of Part III of this chapter).

B. Certification. The cost of meeting all certification standards for NF requirements as required by the appropriate state agencies, by state laws, or by federal legislation or regulations.

C. Operating costs.

1. Direct patient care operating costs shall be defined in 12VAC30-90-271.

2. Allowable direct patient care operating costs shall exclude (i) personal physician fees, and (ii) pharmacy services and prescribed legend and nonlegend drugs provided by nursing facilities which operate licensed in-house pharmacies. These services shall be billed directly to DMAS through separate provider agreements and DMAS shall pay directly in accordance with 12VAC30-80-10 et seq.

3. Indirect patient care operating costs include all other operating costs, not identified as direct patient care operating costs and NATCEPs costs in Appendix I (12VAC30-90-270 through 12VAC30-90-276) of Part III of this chapter, which are allowable under the Medicare principles of reimbursement, except as specifically modified herein and as may be subject to individual cost or ceiling limitations.

D. Allowances/goodwill. Bad debts, goodwill, charity, courtesy, and all other contractual allowances shall not be recognized as allowable costs.

Statutory Authority

§ 32.1-325 of the Code of Virginia and Item 319 (II) of Chapter 1073 of the 2000 Acts of Assembly.

Historical Notes

Derived from VR460-03-4.1940:1 Article 3, eff. July 1, 1994; amended, Virginia Register Volume 12, Issue 16, eff. July 1, 1996; Volume 17, Issue 18, eff. July 1, 2001.

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