The Florida Senate

400.179  Sale or transfer of ownership of a nursing facility; liability for Medicaid underpayments and overpayments.--

(1)  It is the intent of the Legislature to protect the rights of nursing home residents and the security of public funds when a nursing facility is sold or the ownership is transferred.

(2)  Whenever a nursing facility is sold or the ownership is transferred, including leasing, the transferee shall make application to the agency for a new license at least 90 days prior to the date of transfer of ownership.

(3)  The transferor shall notify the agency in writing at least 90 days prior to the date of transfer of ownership. The transferor shall be responsible and liable for the lawful operation of the nursing facility and the welfare of the residents domiciled in the facility until the date the transferee is licensed by the agency. The transferor shall be liable for any and all penalties imposed against the facility for violations occurring prior to the date of transfer of ownership.

(4)  The transferor shall, prior to transfer of ownership, repay or make arrangements to repay to the agency or the Department of Children and Family Services any amounts owed to the agency or the department. Should the transferor fail to repay or make arrangements to repay the amounts owed to the agency or the department prior to the transfer of ownership, the issuance of a license to the transferee shall be delayed until repayment or until arrangements for repayment are made.

(5)  Because any transfer of a nursing facility may expose the fact that Medicaid may have underpaid or overpaid the transferor, and because in most instances, any such underpayment or overpayment can only be determined following a formal field audit, the liabilities for any such underpayments or overpayments shall be as follows:

(a)  The Medicaid program shall be liable to the transferor for any underpayments owed during the transferor's period of operation of the facility.

(b)  Without regard to whether the transferor had leased or owned the nursing facility, the transferor shall remain liable to the Medicaid program for all Medicaid overpayments received during the transferor's period of operation of the facility, regardless of when determined.

(c)  Where the facility transfer takes any form of a sale of assets, in addition to the transferor's continuing liability for any such overpayments, if the transferor fails to meet these obligations, the transferee shall be liable for all liabilities that can be readily identifiable 90 days in advance of the transfer. It shall be the burden of the transferee to determine the amount of all such readily identifiable overpayments from the Agency for Health Care Administration, and the agency shall cooperate in every way with the identification of such amounts. Readily identifiable overpayments shall include overpayments that will result from, but not be limited to:

1.  Medicaid rate changes or adjustments;

2.  Any depreciation recapture;

3.  Any recapture of fair rental value system indexing; and/or

4.  Audits completed by the agency.

The transferor shall remain liable for any such Medicaid overpayments that were not readily identifiable 90 days in advance of the nursing facility transfer.

(d)  Where the transfer involves a facility that has been leased by the transferor:

1.  The transferee shall, as a condition to being issued a license by the agency, acquire, maintain, and provide proof to the agency of a bond with a term of 30 months, renewable annually, in an amount not less than the total of 3 months Medicaid payments to the facility computed on the basis of the preceding 12-month average Medicaid payments to the facility.

2.  The leasehold operator may meet the bond requirement through other arrangements acceptable to the department.

3.  All existing nursing facility licensees, operating the facility as a leasehold, shall acquire, maintain, and provide proof to the agency of the 30-month bond required in subparagraph 1., above, on and after July 1, 1993, for each license renewal.

4.  It shall be the responsibility of all nursing facility operators, operating the facility as a leasehold, to renew the 30-month bond and to provide proof of such renewal to the agency annually at the time of application for license renewal.

5.  Any failure of the nursing facility operator to acquire, maintain, renew annually, or provide proof to the agency shall be grounds for the agency to deny, cancel, revoke, or suspend the facility license to operate such facility and to take any further action, including, but not limited to, enjoining the facility, asserting a moratorium, or applying for a receiver, deemed necessary to ensure compliance with this section and to safeguard and protect the health, safety, and welfare of the facility's residents.

History.--ss. 12, 18, ch. 80-186; s. 2, ch. 81-318; ss. 24, 79, 83, ch. 83-181; s. 51, ch. 83-218; s. 30, ch. 93-177; ss. 23, 49, ch. 93-217; s. 119, ch. 99-8.