SECTION 1. Section 13D of chapter 118E of the General Laws, as appearing in the 2018 Official Edition, is hereby amended by striking out the second paragraph and inserting in its place the following paragraphs:-

Such rates for nursing homes and rest homes, as defined under section 71 of chapter 111, shall be established as of October 1 of each year. In setting such rates, the executive office shall use as base year costs for rate determination purposes the reported costs of the calendar year not more than 2 years prior to the current rate year, and shall incorporate any audit findings applicable to said base year costs. In calculating rates, the occupancy standard for nursing homes shall be set at the statewide average from the base year. Notwithstanding any other general or special law or regulation to the contrary, the rates set for each provider of services, whether funded directly or indirectly by MassHealth, or through any Medicaid replacement plan, shall be sufficient to pay, and such funds shall be used to pay 100 percent of the allowable cost to providers of caring for patients who are beneficiaries of section 9A of this chapter and 100 percent of additional allowable costs.

To the extent permissible by the United States Department of Health and Human Services and Centers for Medicare and Medicaid Services, and including the full amount of the annual increase in the applicable market basket index as determined by said Centers for Medicare and Medicaid Services, fees and assessments, such as the nursing facility user fees and any additional costs incurred by a provider of services as a result of this paragraph, shall be added to the rate for said provider.

In addition, each governmental unit shall pay to a provider of services and each state institution shall charge as a provider of health care services the rates for general health supplies, care and rehabilitative services and accommodations determined and certified by the executive office. In establishing rates of payment to providers of services, the executive office shall comply with the above methods and standards and shall ensure reimbursement for those costs incurred in the ordinary course of business. In calculating rates pursuant to this paragraph, the executive office shall apply 101 CMR 206.00, et seq., in effect as of January 25, 2021, to the extent consistent with this paragraph, this regulation shall not be changed or superseded after January 25, 2021. Rates produced using these methods and standards shall be in conformance with Title XIX of the Federal Social Security Act, including the upper limit on provider payments. This paragraph shall only be amended by a 2/3 vote taken by a call of the yeas and nays of each branch of the general court.