New York Codes, Rules and Regulations › Title 10 - DEPARTMENT OF HEALTH › Chapter XI - Limits On Administrative Expenses And Executive Compensation › Part 1002 - Limits On Administrative Expenses And Executive Compensation › Section 1002.2 - Limits on administrative expenses

Current through Register Vol. 46, No. 28, July 10, 2024
(a) Limits on
				allowable administrative expenses. No less than 75 percent of the covered
				operating expenses of a covered provider paid for with State funds or
				State-authorized payments shall be program services expenses rather than
				administrative expenses. This percentage shall increase by five percent each
				year until it shall be no less than 85 percent in 2015 and for each year
				thereafter. In determining whether an expense is a program service expense or
				an administrative expense, a covered provider may allocate a portion of the
				expense to each type if such allocation is supported by the nature of the
				expense. Such allocation may include allocation of portions of an employee's
				time and compensation to administrative or program services. Commencing on July
				1, 2013, the limits on allowable administrative expenses pursuant to this Part
				shall be effective and applicable to each covered provider on the first day of
				each provider's respective covered reporting period.
(b) Subcontractors and agents of covered
				providers. The restriction on allowable administrative expenses in subdivision
				(a) of this section and the reporting requirements in section
				1002.5 shall apply to
				subcontractors and agents of covered providers if and to the extent that such a
				subcontractor or agent has received State funds or State-authorized payments
				from the covered provider to provide program or administrative services during
				the reporting period and would otherwise meet the definition of a covered
				provider but for the fact that it has received State funds or State-authorized
				payments from the covered provider rather than directly from a governmental
				agency. A covered provider shall incorporate into its agreement with such a
				subcontractor or agent the terms of these regulations by reference to require
				and facilitate compliance. Upon request, covered providers shall promptly
				report to the funding or authorizing agency the identity of such subcontractors
				and agents, along with any other information requested by that agency or by the
				department or its designee. A covered provider shall not be held responsible
				for a subcontractor's or agent's failure to comply with these
				regulations.
(c) Covered providers
				receiving State funds or State-authorized payments from county or local
				government or from entity contracting on its behalf. The department or its
				designee, rather than the county or local unit of government or an entity
				contracting on behalf of such government, shall be responsible for obtaining
				the necessary reporting from and compliance by such covered providers, and
				shall issue guidance to affected county and local governments to set forth the
				procedures by which the department or its designee shall do so.
(d) Covered providers with multiple sources
				of State funds or State-authorized payments. If a covered provider receives
				State funds or State-authorized payments from multiple sources, the provider's
				compliance with the restriction on allowable administrative expenses in
				subsection (a) of this section shall be determined based upon the total amount
				of program services expenses and administrative expenses paid for by such
				funding received from all of such sources. As set forth in section
				1002.5, the covered provider shall
				report all of such State funds and State-authorized payments, and the expenses
				paid for by such funding, in the form and at the time specified by the
				department or its designee.
(e)
				Other limits on administrative expenses. If the contract, grant, or other
				agreement is subject to more stringent limits on administrative expenses,
				whether through law or contract, such limits shall control and shall not be
				affected by the less stringent limits imposed by these regulations. However,
				the definition and interpretation of terms in this Part shall not be affected
				or limited by the definition or interpretation of terms in other regulations or
				agreements.