Tag Archives: healthcare

Final Section 199A Regulations Provide Little Guidance for Skilled Nursing and Assisted Living Facilities

The final Section 199A regulations, which were promulgated on January 18, 2019, make several clarifications to the rules regarding specified service trades or businesses (“SSTB”). Over certain taxable income thresholds, SSTBs are not eligible for the Section 199A deduction. The performance of services in the field of health is an SSTB and is defined in Section 1.199A-5(b)(2) of the final regulations as “the provision of medical services by individuals, such as physicians, pharmacists, nurses, dentists, veterinarians, physical therapists, psychologists, another similar healthcare professionals performing services in their capacity as such.” The operation of health clubs or health spas, payment processing, or the research, testing, manufacture and sales of pharmaceuticals or medical devices are not within the field of health.

Many commentators to the proposed regulations, including Williams Parker, noted that many of the services provided by skilled nursing facilities and assisted living facilities are unrelated to health care, including housing, meals, laundry, security, and socialization activities. Unfortunately, Treasury declined to issue specific guidance as to whether the owners of skilled nursing, assisted living, and similar facilities are performing services within the field of health, and noted that the issue “requires a facts and circumstances inquiry that is beyond the scope of these final regulations.”

However, the final regulations added an example in Section 1.199A-5(b)(3)(ii) of a senior housing facility that is not engaged in the field of health. In the example, the senior housing facility provides its residents with standard domestic services (including housing management and maintenance, meals, laundry, and entertainment), but all medical and health services (including skilled nursing, physical and occupational therapy, speech-language pathology, medications, medical supplies and equipment, and ambulance transportation) are provided through separate professional healthcare organizations. All of the health and medical services are billed directly by the healthcare providers to the senior citizens even though the services are provided at the facility. Unfortunately, the final regulations do not address a scenario where the facility invoices the senior citizens for the health and medical services on behalf of the healthcare providers.

View the final regulations.

This post is one in a series of posts on the 199A regulations. 

Michael J. Wilson
mwilson@williamsparker.com
941-536-2043

Changes Affecting Continuing Care Communities

The Florida Legislature recently passed a bill, CS/HB 749, which implements certain changes in the operations of Continuing Care Communities (“CCCs”) in Florida, effective October 1, 2015.  Some of these changes include:

·     CCCs must be accredited by the Office of Insurance Regulation (“OIR”) without stipulations or conditions before OIR can waive statutory requirements.

·     Each CCC must establish a residents’ council created for the purpose of representing residents on matters set forth in the statutes.  Previously, the establishment of a residents’ council was optional.

·     Certain financial disclosures must be made to the president or chair of the residents’ counsel.

·     Several technical provisions are now required for resident contracts that are entered into on or after January 1, 2016.

These are just a few of the changes that are required for CCCs under the new laws.  The full text of the bill is available here.  For more information on how to make sure your CCC is ready for these new changes, please give us a call or email.

Elizabeth M. Stamoulis
Admitted only in New York
estamoulis@williamsparker.com
941-552-5546

Congress Ends the Medicare Sustainable Growth Rate Formula and Begins Replacing the Fee For Service System

President Obama signed the Medicare Access and CHIP Reauthorization Act of 2015, on Thursday April 16. The Act repeals the long complained about Sustainable Growth Rate formula for computing Medicare reimbursement rates, which had resulted in the annual “Doc Fix” legislation for the last 17 years. The Act also begins the conversion from the Fee For Service system, which has been the way Medicare claims have been paid for 50 years, to a “value-based payment” system. The value-based payment system is designed to promote efficient care by shifting the burden and benefit of efficient care to physicians. There is much debate about the possible effects and side effects of the shift in payment.

The Act, known as MACRA, raises Medicare premiums on persons with incomes over $133,500 ($267,000 per couple), starting at 50% increases up to 80%. The willingness of Congress to index premiums to income in a bipartisan bill (it passed the Senate 92-8) is seen by many as a sign that compromise is possible on both long-term Medicare sustainability and in the event the Supreme Court uses the King v. Burwell case this summer to strike down portions of the Accountable
Care Act.

To gain a broader understanding of the Sustainable Growth Rate and Value-Based Payment impact of MACRA, please see the presentation linked here.  Recent Developments In Healthcare

John L. Moore
jmoore@williamsparker.com
941-329-6620