Certified Final Objection No. 139 of the


Joint Legislative Committee on Administrative Rules


            At its meeting on May 4, 2007, the Joint Legislative Committee on Administrative Rules (Committee) voted, pursuant to RSA 541-A:13, IV, to enter a preliminary objection to Final Proposal 2007-23 containing rule He-E 806.31 of the Department of Health and Human Services (Department) relative to nursing facility reimbursement amendments.  The Department responded pursuant to RSA 541-A:13, V(c) with a cover letter and amended rule from the Commissioner dated May 16, 2007. 


At its meeting on May 18, 2007, the Committee voted, pursuant to RSA 541-A:13, V(f), to enter a final objection to Final Proposal 2007-23.   The final objection has been filed with the Director of the Office of Legislative Services for publication in the New Hampshire Rulemaking Register.  The effect of a final objection is stated in RSA 541-A:13, VI:


     After a final objection by the committee to a provision of a rule is filed with the director under subparagraph V(f), the burden of proof thereafter shall be on the agency in any action for judicial review or for enforcement of the provision to establish that the part objected to is within the authority delegated to the agency, is consistent with the intent of the legislature, is in the public interest, or does not have a substantial economic impact not recognized in the fiscal impact statement.  If the agency fails to meet its burden of proof, the court shall declare the whole or portion of the rule objected to invalid.  The failure of the committee to object to a rule shall not be an implied legislative authorization of its substantive or procedural lawfulness.


            The following summarizes the basis for the Committee’s final objection:


            He-E 806.31(j)(3), He-E 806.31(o)(3) and He-E 806.31(p)


            The Committee objected that He-E 806.31(j)(3), (o)(3) and (p), are, pursuant to Committee Rules 402.02(b)(2) and 403.01(d), respectively, contrary to legislative intent by conflicting with RSA 541-A:3 and RSA 541-A:22, I, and contrary to the public interest by not being drafted in clear and understandable language.


He-E 806.31 contains the methodology for determining the per diem Medicaid rate of reimbursement to nursing facilities.  The Committee’s preliminary objection indicated that the failure in He-E 806.31 to specify the calculation used in the application of a “budget neutrality provision,” as referenced in He-E 806.31(h)(3) and (m)(3), caused He-E 806.31 to be contrary to the public interest due to lack of clarity and contrary to legislative intent by conflicting with RSA 541-A:3 and RSA 541-A:22, I, by allowing rules to be established outside the rulemaking process. 


            In its objection response, the Department inserted a new paragraph, He-E 806.31(p), in which it defined the term “budget neutrality factor.”  The Department also inserted a reference to (p) in He-E 806.31(h)(3) and (m)(3), and renumbered those subparagraphs as He-E 806.31(j)(3) and (o)(3), respectively.


            After receiving testimony and discussing the proposed rules, the Committee determined that the bases for preliminary objection had not been removed in the objection response to Final Proposal 2007-23.  Therefore the Committee entered a final objection, for the same reasons, to He-E 806.31(j)(3), (o)(3) and (p).