Senate Bill No. 805 requires nursing homes to allocate at least eighty percent of their revenues from Medicaid, Medicare, and other payment sources towards direct patient care, effective July 1, 2025. The bill amends section 17b-340d of the general statutes by repealing subsection (a) and replacing it with new provisions that mandate the Commissioner of Social Services to implement an acuity-based methodology for Medicaid reimbursement, updated quarterly. Additionally, nursing homes must collect and report quality metrics, with adjustments to Medicaid rates based on performance starting July 1, 2022. Individualized reports on these metrics will be provided annually to nursing homes, and a comprehensive report on the quality metrics program is to be submitted to the General Assembly by June 30, 2025.

The legislation also outlines specific provisions regarding allowable costs for nursing homes, categorizing them into direct, indirect, fair rent, capital-related, and administrative costs, while establishing maximum allowable costs for direct and indirect expenses. The Commissioner has the discretion to allow exceptions for specialized services. The bill modifies the rate-setting process, stipulating that costs will be rebased every two to four years without inflation adjustments during rebasing years, and it deletes previous provisions regarding allowable patient days. Overall, SB 805 aims to enhance the quality of care in nursing homes by ensuring a significant portion of their revenues is directed towards patient care and by implementing a structured approach to Medicaid reimbursement based on quality metrics.