Pennsylvania Code › Title 55 - HUMAN SERVICES › Part III - MEDICAL ASSISTANCE MANUAL › Chapter 1187 - NURSING FACILITY SERVICES › Subchapter E - ALLOWABLE PROGRAM COSTS AND POLICIES › Section 1187.61 - Movable property cost policies

Current through Register Vol. 54, No. 28, July 13, 2024
(a)
Actual acquisition cost during
				  cost report period.
Except as otherwise specified in this section and
				  subject to §§
										1187.58 and
				  1187.60 (relating to costs of
				  related parties; and prudent buyer concept), a nursing facility's allowable
				  movable property shall be limited to the nursing facility's actual acquisition
				  cost of movable property placed in service during the cost report
				  period.
(b)
Determination
				  of acquisition cost.
Except in situations where an item of movable
				  property is obtained from a related party, the acquisition cost of that item
				  shall be determined as follows:
(1)
				  Acquisition cost is determined on a per-unit basis.
(2) When an item is purchased, the
				  acquisition cost of that item is equal to the total actual purchase price of
				  the item, regardless of whether the total price is paid in full at the time of
				  purchase or over a period of time, plus the following: any required sales tax,
				  shipping charges and installation charges.
(3) When an item of movable property is
				  leased or rented, the acquisition cost is limited to the lower of: the actual
				  annual lease or rental payments made by the nursing facility; or the imputed
				  purchase price of the item, pro-rated on a straight-line basis over the useful
				  life of the item, as identified in the most recent Uniform Chart of Accounts
				  and Definitions for Hospitals published by the American Hospital Association at
				  the time the item is leased or rented. For purposes of this section, the
				  imputed purchase price of a leased or rented item is the lesser of:
(i) The suggested list price from the
				  manufacturer of the item.
(ii) The
				  actual discounted price of the item available at the time of lease or
				  rental.
(iii) The purchase price
				  for the item set forth in the lease or rental agreement.
(iv) If the lessor is a related party, the
				  related party's acquisition cost as determined in accordance with paragraph
				  (2).
(4) When an item is
				  acquired as the result of a gift or donation, the acquisition cost of that item
				  is deemed to be the appraised depreciated replacement cost of the item provided
				  that, on a date prior to the submission of the MA-11 for the period in which
				  the item is acquired, the nursing facility obtains an appraisal of the item's
				  depreciated replacement cost from a licensed appraiser and submits a copy of
				  the written report of the appraisal to the Department with its MA-11. If the
				  nursing facility fails to obtain an appraisal of the item's depreciated
				  replacement cost from a licensed appraiser within the time period set forth in
				  this section or if the nursing facility fails to submit a copy of the written
				  report of the appraisal to the Department with its MA-11, the acquisition cost
				  of the donated item or gift is deemed to be $0.
(5) When an item is acquired by a trade-in,
				  the acquisition cost of the item shall be the sum of the remaining book value
				  of the item traded-in plus any acquisition cost of the newly acquired item,
				  computed in accordance with paragraphs 2, 3 and 4. The remaining book value of
				  the item shall be determined based upon the useful life of the item, using the
Uniform Chart of Accounts and Definitions for Hospitals
published by the American Hospital Association, and depreciation computed on a
				  straight-line basis.
(6) When an
				  item is loaned to the nursing facility without charge, the acquisition cost of
				  that item is deemed to be $0.
(7)
				  When an item is covered by a standard express warranty, the cost of that
				  warranty is included in the acquisition cost of the item. The cost of any
				  extended warranty is not included in the acquisition cost of the
				  item.
(8) When an item is acquired
				  from a related party, the acquisition cost of the item shall be determined
				  under § 1187.58.