OAR 411-070-0330
Owner Compensation


(1)

Reasonable compensation for services performed by owners (whether sole proprietors, partners, or stockholders) is an allowable cost, provided the services are actually performed, documented, and are necessary, and the provisions of this rule are met.

(2)

The allowance of compensation for services of sole proprietors and partners is the amount determined by the Department to be the reasonable value of the services rendered as long as compensation was paid in conformance with this rule.

(3)

Compensation for services performed by owners may be included in allowable provider cost only to the extent that it represents reasonable remuneration for managerial, administrative, professional, and other services related to the operation of the facility and rendered in connection with resident care. Services rendered in connection with resident care include both direct and indirect activities in the provision and supervision of resident care, such as administration, management, and overall supervision of the institution. Services which are not related to either direct or indirect resident care; e.g., those primarily for the purpose of managing or improving the owner’s financial investment are not recognized as an allowable cost. Costs related to the owner’s management and overall supervision of the facility will be reported in Account 436.

(4)

Payments to an owner that represent a return on equity capital are not allowable costs for reimbursement purposes. Such payments are not considered as compensation for purposes of determining the reasonable level of reimbursement of the owner.

(5)

The compensation allowance will be an amount as would ordinarily be paid for comparable services in other nursing facilities, as defined by section (6) of this rule. This determination will be made by the Department depending upon the facts and circumstances of each case.

(6)

For purposes of determining whether the compensation paid to or claimed by an owner is reasonable, the total of all benefits and remuneration such as travel allowance or key-man insurance, regardless of the form, will be considered. The Department has established the 75th percentile ranking of average compensation paid, in all facilities by job category, as being reasonable.

(7)

Accrued compensation of an owner, if not paid within 75 days after the end of the Nursing Facility Financial Statement reporting period, may not be included as an allowable expense.

(8)

An owner must not be compensated for services in excess of 40 hours in one week. This rule applies even if an owner may provide services in more than one area.

(9)

The requirement that the function be necessary means that had the owner not rendered the services, the institution would have had to employ another person to perform them. The services must be pertinent to the operation and sound conduct of the institution.

(10)

Compensation paid to an employee who is an immediate relative of the owner of the facility is also reviewable under the test of reasonableness. For this purpose, the following persons are considered “immediate relatives”: Husband and wife; natural parent, child and sibling; adopted child and adoptive parent; stepparent, stepchild, stepbrother and stepsister; father-in-law, mother-in-law, son-in-law, daughter-in-law, brother-in-law, and sister-in-law; and grandparent and grandchild, uncle, aunt, nephew, niece, and cousin.

(11)

Where an owner provides services for more than one facility or is engaged in other occupations or business activities, allowable compensation may be adjusted to reflect an appropriate allocation of time spent in each area based on the combined total of resident days.

(12)

Where an owner functions as an administrator or assistant administrator, the rules governing compensation of these positions apply, in addition to the requirements of this rule.
411‑070‑0000
Purpose
411‑070‑0005
Definitions
411‑070‑0010
Conditions for Payment
411‑070‑0015
Denial, Termination or Non-Renewal of Provider Agreement
411‑070‑0020
On-Site Reviews
411‑070‑0025
Basic Flat Rate Payment (Basic Rate)
411‑070‑0027
Complex Medical Add-On Payment
411‑070‑0028
Bariatric Authorization and Payment
411‑070‑0029
Pediatric Rate
411‑070‑0033
Post Hospital Extended Care Benefit
411‑070‑0035
Complex Medical Add-On Effective Start and End Dates and Administrative Review
411‑070‑0040
Screening, Assessment, and Resident Review
411‑070‑0043
Pre-Admission Screening and Resident Review (PASRR)
411‑070‑0045
Facility Payments
411‑070‑0050
Days Chargeable
411‑070‑0075
Rates - Facilities in Oregon
411‑070‑0080
Out-of-State Rates
411‑070‑0085
Bundled Rate
411‑070‑0087
Bariatric Criteria and Services
411‑070‑0091
Complex Medical Add-On Services
411‑070‑0092
Ventilator Assisted Program - Medicaid Payment
411‑070‑0095
Resident Funds
411‑070‑0100
Audit of Personal Incidental Funds
411‑070‑0105
Resident Property Records
411‑070‑0110
Temporary Absence from Facility (Bedhold)
411‑070‑0115
Transfer of Residents
411‑070‑0120
Discharge of Residents
411‑070‑0125
Medicare, (Title XVIII)
411‑070‑0130
Medicaid Payment in Hospitals
411‑070‑0140
Hospice Services
411‑070‑0300
Filing of Financial Statement
411‑070‑0302
Filing of Revised Financial Statements
411‑070‑0305
Accounting and Record Keeping
411‑070‑0310
Auditing
411‑070‑0315
Maximum Allowable Compensation of Administrator
411‑070‑0320
Consultants
411‑070‑0330
Owner Compensation
411‑070‑0335
Related Party Transactions
411‑070‑0340
Chain Operations
411‑070‑0345
Allocation of Home Office and Regional Office Costs
411‑070‑0350
Management Fees
411‑070‑0359
Allowable Costs
411‑070‑0365
Capital Assets
411‑070‑0370
Depreciable Assets
411‑070‑0375
Depreciation Basis
411‑070‑0385
Depreciation Lives
411‑070‑0400
Equity
411‑070‑0415
Offset Income
411‑070‑0417
Treatment of Complex Medical Add-Ons
411‑070‑0420
Base Year Cost Finding
411‑070‑0425
Resident Days
411‑070‑0430
Allocation Methods
411‑070‑0435
Appeals
411‑070‑0437
Quality and Efficiency Incentive Program
411‑070‑0439
COVID-19 Emergency Response Incentive Program
411‑070‑0442
Calculation of the Basic Rate, Complex Medical Rate, Bariatric Rate and Ventilator Assisted Program Rate
411‑070‑0452
Pediatric Nursing Facilities
411‑070‑0464
Final Report
411‑070‑0465
Uniform Chart of Accounts
411‑070‑0470
Nursing Assistant Training and Competency Evaluation Programs Request for Reimbursement
Last Updated

Jun. 8, 2021

Rule 411-070-0330’s source at or​.us