Section 441.162.3. Grant eligibility.

       162.3(1) Eligible applicants. A grant applicant shall be:

        a.           A licensed nursing facility that has been an approved provider under the medical assistance program under the same ownership for the two-year period prior to application for the grant.

        b.           A provider of long-term care services, including one not covered by the medical assistance program, that has been in business for at least two years under the same owner.

       162.3(2) Types and amounts of grants.

        a.           Architectural and financial feasibility study allowance. An architectural and financial feasibility study allowance may be awarded solely for costs directly attributable to development of the architectural and financial review documentation associated with conversion or service development. Architectural and financial feasibility study allowances for conversion or service development grants are limited to $15,000, not to exceed actual costs for each project.

        b.           Conversion grants. A conversion grant may be awarded to convert all or a portion of a licensed nursing facility to affordable certified assisted living units (limited to $45,000 per unit) and for capital or one-time expenditures including, but not limited to, start-up expenses, training expenses, and operating losses for the first year of operation following conversion.

Conversion grants are limited to a total of $1,000,000 per facility, with an additional $100,000 if the provider agrees to also provide adult day care, child care for children with special needs, safe shelter for victims of dependent adult abuse, or respite care.

A grant application which expands resident capacity of an existing nursing facility shall not be considered. A grant that requires additional space to accommodate supportive services related to the functioning of the long-term care alternative, such as dining rooms, kitchen and recreation areas, or other community-use areas, may be considered.

        c.           Long-term care services development grant. A long-term care services development grant may be awarded for capital or one-time expenditures to develop needed long-term care services covered under a Medicaid HCBS waiver or to develop a PACE program. Expenditures may include, but are not limited to, start-up expenses, training expenses, and operating losses for the first year of operation. Service development grants are limited to $1,000,000 per PACE program, and $150,000 for HCBS waiver services.

       162.3(3) Criteria for grant applicants. A grant shall be awarded only to an applicant meeting all of the following criteria:

        a.           The applicant is located in an area determined by the senior living coordinating unit to be underserved with respect to a particular long-term care alternative service.

        b.           The applicant is able to provide a minimum matching contribution of 20 percent of the total cost of any conversion, remodeling, or construction. Costs used by grantees to match grant funds shall be directly attributable to the costs of conversion or service development.

        c.           Grant applications from nursing facilities shall be considered only from facilities with an established history of providing quality long-term care services. Facilities shall be in substantial compliance with federal Medicaid participation requirements as evidenced at a minimum by all of the following:

       (1)             No identified deficiencies which pose a significant risk to resident health and safety at the time of application.

       (2)             No more than one isolated event resulting in actual harm to residents during the current Medicaid certification period.

       (3)             No citations for a pattern of events resulting in actual harm to residents for three years prior to application.

        d.           Grants to applicants other than nursing facilities shall be considered from applicants only when:

       (1)             There is substantial compliance with Medicare and Medicaid participation requirements or other applicable provider certification requirements at the time of application.

       (2)             Compliance exists with Medicare and Medicaid requirements, if applicable, for a three-year period prior to application.

       (3)             Compliance exists with the criminal background check system, if applicable.

        e.           The applicant agrees to do all of the following as applicable to the type of grant:

       (1)             Participate in the medical assistance program and maintain a medical assistance client participation rate of at least 40 percent, subject to the demand for participation by persons eligible for medical assistance. Applicants shall also agree that persons able to pay the costs of assisted living shall not be discharged from their living unit due to a change in payment source.

       (2)             Provide a service delivery package that is affordable for those persons eligible for services under the medical assistance home- and community-based services waiver program.

       (3)             Provide a refund of the grant to the senior living trust fund on a prorated basis if the applicant or the applicant’s successor in interest: ceases to operate an affordable long-term care alternative within the first ten-year period of operation following the awarding of the grant; fails to maintain a participation rate of 40 percent in accordance with subparagraph (1) within the first ten-year period of operation following the awarding of the grant; or discharges persons able to pay the costs of assisted living from their living unit due to a change in payment source.

        f.            The applicant must demonstrate that the proposed method of construction, whether new or remodeling, is the most cost-effective for the grant program and, when developing assisted living units, must agree that a specified number of existing nursing facility beds will not continue to be licensed.

       162.3(4) Allowable and nonallowable costs.

        a.           Examples of allowable costs include:

       (1)             Professional fees incurred specifically for conversion of facility or service development, including architectural, financial, legal, human resources, research, and marketing fees.

       (2)             Construction costs for the remodeling of existing space and, if necessary, the construction of additional space required to accommodate assisted living program services or other alternatives to nursing facility care or new construction of an assisted living facility or other alternative to nursing facility care if existing nursing facility beds are no longer licensed and the department determines that new construction is more cost-effective for the grant program than the conversion of existing space.

       (3)             Start-up and training expenses and operating losses for the first year.

        b.           Examples of nonallowable costs include:

       (1)             Costs of travel, personal benefits, and other facility programs or investments.

       (2)             Construction costs to remodel nursing facility space that will remain in use for nursing facility care.

       (3)             Any costs associated with operation and maintenance of a non-grant-related facility or service.

       (4)             Any costs incurred above per-unit grant amounts.