Layaway and Planned Closure Options for Addressing Low Occupancy in Care Centers

Posted on April 28, 2021 by Jeff Bostic

The LeadingAge Minnesota and our partner in the Long-Term Care Imperative recently completed analysis of care center occupancy in 2020, which showed a historic drop due to the pandemic. While providers wait to see what happens with occupancy going forward, they do have a couple of options to address that issue.

Bed Layaway
Beds that are placed on layaway are treated as if they are not currently licensed, so they are not subject to surcharge or license fees, and providers can create more single rooms and charge a differential for them. Beds on layaway must be out of service for a year, and they can only be on that status for ten years before being automatically delicensed. Members who are interested in laying away beds should contact Shellae Dietrich at MDH, Shellae.Dietrich@state.mn.us or 651-201-4106.

Planned Closure
Care centers that decide that want to permanently close beds are eligible for an incentive of $2,080 per bed as an ongoing rate increase to compensate for the marginal cost of operating at a lower capacity. Members who want to apply for that incentive should contact Bev Milotzky at DHS at bev.milotzky@state.mn.us or 651-431-2277. Providers interested in applying for that incentive should be sure to complete that process before notifying MDH that they are going to close the beds.

Expiring Layaway Beds
Providers who have beds that have been on layaway for ten years will have them automatically delicensed, and if they do not apply and get approved for the planned closure incentive before that time they will not receive it. Often members are not even aware that they have layaway beds because that information is not posted anywhere on the MDH web site. Providers can use this list to identify whether they have layaway beds that are close to expiration and start the process of applying for a closure incentive. Look for those on the first twenty pages of the file that have a layaway date but no remove date.