Dear Administrator: Trend Factor Adjustment on Rates for RHCFs Receiving NHQID Program Grant Awards

February 26, 2007

Dear Administrator:

In accordance with Chapter 109 of the Laws of 2006, subdivision 28, rates of payments by state governmental agencies effective for services provided beginning April 1, 2006 and thereafter for inpatient services and outpatient adult day health care services provided by residential health care facilities pursuant to Article 28 of the Public Health Law (PHL), the Commissioner of Health shall apply a trend factor projection of two and twenty-five hundredths percent. Enclosed herein are the revised rate sheets implementing the .25% trend factor reduction for the period April 1, 2006 through December 31, 2006.

Chapter 1 of the Laws of 2002, which added section 2808-d of the Public Health Law, and Chapter 686 of the Laws of 2003, Chapter 161 of the Laws of 2005 and Chapter 57 of the Laws of 2006 which amended this section, provide for payments to certain residential health care facilities (RHCFs) for the nursing home quality improvement demonstration program grant awards.

If your facility currently receives this grant award, the enclosed rates, for the period January 1, 2006 through December 31, 2006, include an adjustment for your facility's allocation of the revised total grant award for 2006. The attached schedule shows the detail of the 1/1/06 per diem recalculation. This adjustment is included as a Miscellaneous C adjustment on Schedule VII of the rate sheet.

The rates have been forwarded to the Office Of Medicaid Management for payment. If you have any questions relating to the calculation of your 2006 Medicaid rates for

Sincerely,

Mark H. Van Guysling

Assistant Director

Division of Health Care Financing

Enclosure