The Texas Health and Human Services Commission (HSSC) adopts amendments to §§355.102, 355.103, 355.105, 355.106, 355.110, and 355.111. The amendments to §§355.103, 355.105, 355.110, and 355.111 are adopted without changes to the proposed text published in the April 14, 2000, issue of the Texas Register (25 TexReg 3123). The amendment to §355.102 and §355.106 are adopted with technical changes.

Justification for the amendments is to define approval processes and cost reporting procedures, clarify allowable and unallowable costs, remove obsolete references, replace an obsolete reference with a new reference, and correct a typographical error. The amendments clarify current allowable and unallowable costs rules regarding where to report different types of benefits on the cost report and the definition of a passenger van. Clarifications are also being made to the process for requesting a waiver of the related party requirements for reporting costs on the cost report, the disclosure and process for requesting approval of an acceptable allocation method, and the contact for sending a request for an informal review of cost report adjustments. The adoption also specifies that the request of a waiver of the related party requirement for reporting costs on the cost report must be submitted within 45 days of the due date of the cost report. Clarifications are also being made to the definition of direct costing of certain costs on the cost report. The adoption clarifies that prior approval must be obtained to use an allocation method that is not in compliance with DHS rules. The adoption explains what is a functional allocation method. The adoption also grants a compliance period of 15 calendar days before a vendor hold can be placed for failure to submit a required cost report, correct a typographical error regarding how often mandatory cost report training must be attended. The rules requiring completion of cost reports according to instructions and rules that differentiate between 1994, 1995, and 1996 cost reports and cost reports for 1997 and subsequent years have been deleted. The requirement that cost reports must be completed according to instructions and rules has been moved and restated without a differentiation between cost report years. The rule reference to vendor hold for the nursing facility program has been revised to a new rule reference.

The amendments will function by providing guidance to contracted providers regarding the completion of required costs reports.

The department received no comments regarding adoption of the amendments. The department has made technical changes to §355.102(j)(4)(D) to correct the cite to §355.103(b)(10)(B)(ii) of this title (relating to Specifications for Allowable and Unallowable Costs) and to §355.106 to correct the cite to be 40 TAC §19.2703 (relating to Vendor Hold).

The amendments are adopted under the Government Code, §531.033, which authorizes the commissioner of the Health and Human Services Commission to adopt rules necessary to carry out the commission's duties, and §531.021(b), which establishes the commission as the agency responsible for adopting reasonable rules governing the determination of fees, charges, and rates for medical assistance payments under Chapter 32, Human Resources Code.

The amendments implement the Government Code, §531.033 and §531.021(b).