(A)

1. (1) Except as provided in division (B) of this section and in accordance with the process specified in rules authorized by this section, the department of medicaid shall do all of the following:

   1. (a) Every quarter, determine the following two case-mix scores for each nursing facility:

      1. (i) A quarterly case-mix score that includes each resident who is a medicaid recipient and is not a low resource utilization resident;
      2. (ii) A quarterly case-mix score that includes each resident regardless of payment source.
   2. (b) Every six months, determine a semiannual average case-mix score for each nursing facility by using the quarterly case-mix scores determined for the nursing facility pursuant to division (A)(1)(a)(i) of this section;
   3. (c) After the end of each calendar year, determine an annual average case-mix score for each nursing facility by using the quarterly case-mix scores determined for the nursing facility pursuant to division (A)(1)(a)(ii) of this section.

2. (2) When determining case-mix scores under division (A)(1) of this section, the department shall use all of the following:

   1. (a) Data from a resident assessment instrument specified in rules authorized by section 5165.191 of the Revised Code;
   2. (b) Except as provided in rules authorized by this section, the case-mix values established by the United States department of health and human services;
   3. (c) Except as modified in rules authorized by this section, the grouper methodology used on June 30, 1999, by the United States department of health and human services for prospective payment of skilled nursing facilities under the medicare program.

(B)

1. (1) Subject to division (B)(2) of this section, the department, for one or more months of a calendar quarter, may assign to a nursing facility a case-mix score that is five per cent less than the nursing facility's case-mix score for the immediately preceding calendar quarter if any of the following apply:

   1. (a) The provider does not timely submit complete and accurate resident assessment data necessary to determine the nursing facility's case-mix score for the calendar quarter;
   2. (b) The nursing facility was subject to an exception review under section 5165.193 of the Revised Code for the immediately preceding calendar quarter;
   3. (c) The nursing facility was assigned a case-mix score for the immediately preceding calendar quarter.
2. (2) Before assigning a case-mix score to a nursing facility due to the submission of incorrect resident assessment data, the department shall permit the provider to correct the data. The department may assign the case-mix score if the provider fails to submit the corrected resident assessment data not later than the earlier of the forty-fifth day after the end of the calendar quarter to which the data pertains or the deadline for submission of such corrections established by regulations adopted by the United States department of health and human services under Title XVIII and Title XIX.
3. (3) If, for more than six months in a calendar year, a provider is paid a rate determined for a nursing facility using a case-mix score assigned to the nursing facility under division (B)(1) of this section, the department may assign the nursing facility a cost per case-mix unit that is five per cent less than the nursing facility's actual or assigned cost per case-mix unit for the immediately preceding calendar year. The department may use the assigned cost per case-mix unit, instead of determining the nursing facility's actual cost per case-mix unit in accordance with section 5165.19 of the Revised Code, to establish the nursing facility's rate for direct care costs for the fiscal year immediately following the calendar year for which the cost per case-mix unit is assigned.
4. (4) The department shall take action under division (B)(1), (2), or (3) of this section only in accordance with rules authorized by this section. The department shall not take an action that affects rates for prior payment periods except in accordance with sections 5165.41 and 5165.42 of the Revised Code.

(C) The medicaid director shall adopt rules under section 5165.02 of the Revised Code as necessary to implement this section.

1. (1) The rules shall do all of the following:

   1. (a) Specify the process for determining the semiannual and annual average case-mix scores for nursing facilities;
   2. (b) Adjust the case-mix values specified in division (A)(2)(b) of this section to reflect changes in relative wage differentials that are specific to this state;
   3. (c) Express all of those case-mix values in numeric terms that are different from the terms specified by the United States department of health and human services but that do not alter the relationship of the case-mix values to one another;

   4. (d) Modify the grouper methodology specified in division (A)(2)(c) of this section as follows:

      1. (i) Establish a different hierarchy for assigning residents to case-mix categories under the methodology;
      2. (ii) Prohibit the use of the index maximizer element of the methodology;
      3. (iii) Incorporate changes to the methodology the United States department of health and human services makes after June 30, 1999;
      4. (iv) Make other changes the department determines are necessary.
   5. (e) Establish procedures under which resident assessment data shall be reviewed for accuracy and providers shall be notified of any data that requires correction;
   6. (f) Establish procedures for providers to correct resident assessment data and specify a reasonable period of time by which providers shall submit the corrections. The procedures may limit the content of corrections in the manner required by regulations adopted by the United States department of health and human services under Title XVIII and Title XIX.
   7. (g) Specify when and how the department will assign case-mix scores or costs per case-mix unit to a nursing facility under division (B) of this section if information necessary to calculate the nursing facility's case-mix score is not provided or corrected in accordance with the procedures established by the rules.
2. (2) Notwithstanding any other provision of this chapter, the rules may provide for the exclusion of case-mix scores assigned to a nursing facility under division (B) of this section from the determination of the nursing facility's semiannual or annual average case-mix score and the cost per case-mix unit for the nursing facility's peer group.