Terms used in this chapter mean:

1. (1) "Administration costs," costs defined in the statistical and cost summary report that relate to patient care and includes the administrator's and assistant administrator's salaries, administrative travel, office salaries, office supplies and expenses, central office and home office expenses, dues, fees, subscriptions, professional license fees, and legal and accounting expense;
2. (2) "Capital costs," costs associated with building insurance, building depreciation, furniture and equipment depreciation, amortization of organization and preoperating costs, mortgage interest, rent on the facility and grounds, equipment rent, and return on net equity;
3. (3) "Case mix," the mixture of residents of different classifications within a nursing facility;
4. (4) "Case mix score," the average of the Patient Driven Payment Model nursing case mix group weights for residents in a facility over a particular time period;
5. (5) "Chain organization," a group of two or more health care facilities that are owned, leased, or otherwise controlled by one organization;
6. (6) "Desk audit," a review of the statistical and cost reports to determine omissions, erroneous calculations, reasonableness of selected cost items, and compliance with other reporting requirements before establishing a database from which per diem rates are established;
7. (7) "Field audit," a comprehensive, on-site review of the statistical and cost reports to determine omissions, erroneous calculations, reasonableness of selected cost items, and compliance with other reporting requirements before establishing a database from which per diem rates are established;
8. (8) "Hospital-affiliated nursing facility," a licensed nursing facility that is under common ownership with, is operated by the same administrative authority as, and shares on a daily basis common services areas with, the licensed hospital, and that is required to use the stepdown method of allocation required by Medicare if the stepdown results in part of the cost of the shared areas being allocated between the hospital and the nursing facility, and the stepdown numbers are the numbers used for Medicare reimbursement;
9. (9) "Nursing facility," any facility that is licensed, maintained, and operated for the express or implied purpose of providing care to one or more persons, whether for consideration or not, who are not acutely ill but require nursing care and related medical services of such complexity as to require professional nursing care under the direction of a physician twenty-four hours a day;
10. (10) "Over-the-counter medications," medications that can be purchased by the general public without a physician or other licensed practitioner's prescription;
11. (11) "Patient Driven Payment Model," the relative ratio of resources required to care for one class of residents when compared to another class of residents as measured by the resident assessment using the nursing case mix group;
12. (12) "Related-party transaction," a business transaction between parties having a common ownership or control interest;
13. (13) "Resident assessment," a comprehensive assessment of a nursing facility resident completed under § 44:73:06:10;
14. (14) "Routine services," services and items necessary for the care, treatment, and comfort of a resident;
15. (15) "Salvage value," the estimated value of a depreciable asset at the end of its useful life. The value is estimated at the time of acquisition or construction and is deducted from the cost of the depreciable property to arrive at the basis for depreciation;
16. (16) "Stepdown method of allocation," an accounting methodology in which costs flow from nonrevenue-producing cost centers to revenue-producing cost centers. On ledgers showing this allocation, the lists of numbers take on a visual tiering appearance from the left of the page to the right;
17. (17) "Straight-line depreciation method," a procedure followed in depreciation computations that assigns equal segments of the cost of an item to the benefits to be yielded by the item, often over a period of time; and
18. (18) "Swing-bed hospital," an acute care general hospital that has been approved by the Department of Health to provide short-term nursing facility services in a portion of its licensed hospital beds pending the availability of a nursing facility bed.

Source: SL 1975, ch 16, § 1; 1 SDR 30, effective October 13, 1974; 2 SDR 16, effective September 4, 1975; 7 SDR 66, 7 SDR 89, effective July 1, 1981; 11 SDR 26, effective August 21, 1984; 15 SDR 68, effective November 7, 1988; 16 SDR 26, effective August 13, 1989; 18 SDR 67, effective October 13, 1991; transferred from § 67:16:04:01 , 21 SDR 8, effective July 25, 1994; 24 SDR 185, effective July 6, 1998; 26 SDR 5, effective July 1, 1999; 26 SDR 21, effective August 24, 1999; 35 SDR 312, effective July 6, 2009; 44 SDR 94, effective December 4, 2017 ; 50 SDR 11, effective August 7, 2023 .

General Authority: SDCL 28-6-1 .

Law Implemented: SDCL 28-6-1 (4) .

Prior versions effective: 2017-12-04, 2009-07-06.