The following method is an extension of the general requirements for analysis of need set forth in OAR 333-580-0040(1):

1. (1) Determine service area:

   1. (a) The default service area is the county in which the nursing facility is located.

   2. (b) If the county has no licensed nursing facility, or if hospital referral patterns or geographic access indicate that a county‑based service area would not reflect actual utilization, the Oregon Health Authority may use a multi‑county service area based on:

      1. (A) Hospital referral patterns;
      2. (B) Resident origin and discharge data;
      3. (C) Travel‑time and travel‑distance accessibility;
      4. (D) Rural health service availability; or
      5. (E) Patterns of post‑acute care.
   3. (c) An applicant may propose an alternative service area supported by evidence demonstrating that the proposed boundaries reflect actual utilization and access patterns for post‑acute and long‑stay residents.

2. (2) Collect utilization data. The applicant shall submit, and the Oregon Health Authority shall use, the most recent five years of available data, including:

   1. (a) Hospital discharge data showing the number of discharges to nursing facilities, categorized by major clinical condition or Medicare Severity‑Diagnosis Related Grouping;
   2. (b) Minimum Data Set (MDS) data identifying short‑stay (less than or equal to 90 days) and long‑stay (greater than 90 days) utilization patterns;
   3. (c) Annual nursing facility cost reports or other publicly available utilization reports showing resident days, admissions, discharges, and set‑up bed availability;
   4. (d) Set‑up bed inventories for all facilities in the service area; and
   5. (e) Home and Community Based Services utilization data where relevant to understanding long‑stay trends.

3. (3) Calculate service area capacity.

   1. (a) The number of set‑up beds constitutes the operational supply of nursing facility beds for all calculations in this rule. Licensed beds that are not set‑up as of the date of the letter of intent shall not be counted as available capacity.
   2. (b) The applicant shall determine the total number of set‑up beds in the service area for each of the past five years.

4. (4) Determine historical utilization for each of the past five years. The applicant shall determine:

   1. (a) Total resident days;
      (b) Short‑stay resident days (less than or equal to 90 days);
      (c) Long‑stay resident days (greater than 90 days);
      (d) Number of hospital discharges to nursing facilities; and
      (e) Population age 65 and older and population age 75 and older within the service area.

      1. (A) Short‑stay utilization rates must be calculated per 1,000 hospital discharges, stratified where possible by major clinical category.
      2. (B) Long‑stay utilization rates must be calculated per 1,000 persons age 75 and older, unless the applicant demonstrates that another age cohort better represents long‑stay demand within the service area.
5. (5) The Oregon Health Authority shall apply smoothing or statistical adjustment methods to avoid distortion from the COVID‑19 pandemic, temporary closures, or anomalous events.

6. (6) Evaluate occupancy and utilization patterns:

   1. (a) Occupancy shall be calculated using: Occupancy = total resident days ÷ (set‑up beds × 365).

   2. (b) Occupancy levels, trends, and variability shall be analyzed over the five‑year period, including:

      1. (A) Whether occupancy is increasing, decreasing, or stable;
         (B) Differences between short‑stay and long‑stay utilization;
         (C) The age distribution of long‑stay residents, including changes in the population age 75 and older in the service area;
         (D) Geographic disparities within the service area; and
         (E) Facility‑level variation in occupancy or case mix.
   3. (c) The Oregon Health Authority shall consider occupancy in conjunction with demand, access, staffing capacity, age‑related demographic trends affecting long‑stay utilization, and changes in the post‑acute care environment.

7. (7) Assess localized access constraints. Nursing facility need may be demonstrated by evidence of at least one of the following:

   1. (a) Documented hospital discharge delays caused by insufficient nursing facility availability or specialty beds;
   2. (b) Extraordinary travel time to the nearest appropriate nursing facility;
   3. (c) Insufficient availability of specialized services (such as ventilator care, behavioral health, bariatric care, or complex medical care);
   4. (d) Chronic understaffing preventing conversion of licensed beds to set‑up beds;
   5. (e) Lack of facilities in the county or region such that residents must routinely cross county or regional boundaries to obtain care; or
   6. (f) Hospital readmissions.

8. (8) Determine future bed need. Forecast short‑stay and long‑stay demand:

   1. (a) Short‑stay demand shall be forecast using projected hospital discharge volumes, adjusted for observed admission rates into nursing facilities.

   2. (b) Long‑stay demand shall be forecast using:

      1. (A) Historical long‑stay rates;
         (B) Expected Home and Community Based Service (HCBS) utilization; and
         (C) Expected changes in the population age 75 and older.
   3. (c) Demand shall be forecast for the year three years after the calendar year of application.

9. (9) Determine future bed inventory. Projected future supply shall include or account for:

   1. (a) Current set‑up beds at the time of applicant’s letter of intent;
      (b) Beds associated with approved but not yet operational Certificate of Need projects; and
      (c) Beds scheduled for closure or conversion at the time of applicant’s letter of intent.

10. (10) Identify any shortfall. A bed shortfall exists if:

    1. (a) Required beds exceed projected future set‑up beds; or
       (b) Localized access constraints under section (6) would remain unresolved without additional beds.
11. (11) Consistency with service area planning. If a service area plan exists, the applicant must demonstrate consistency or justify deviation due to updated data, access considerations, or changes in Home and Community Based Service availability.

Statutory/Other Authority

ORS 431.120 & 442.315

Statutes/Other Implemented

ORS 431.120 & 442.315

History

PH 27-2026, temporary amend filed 06/25/2026, effective 06/25/2026 through 12/21/2026
HD 13-1994, f. & cert. ef. 4-22-94