KENTUCKY HEALTH CARE PROVIDER TAX RETURN
Effective July 1, 2024, pursuant to KRS 142.361(1)(d), the following rate adjustments occurred for nursing facility services:
Class 15 rate change from $3.64 per non-Medicare bed day to $5.63
Class 77 rate change from $1.82 per non-Medicare bed day to $2.82
Class 88 rate change from $4.12 per non-Medicare bed day to $6.38
Class 99 rate change from $12.85 per non-Medicare bed day to $19.89
These revised assessment rates are based on the most recently available nursing facility revenue data and are calculated to reach but not exceed the allowable tax limits of each class.
Effective for the July 2004 return, the tax on nursing facility services is no longer based on gross revenues. The tax is now based on a non-Medicare patient bed day basis. “Total non-Medicare patient bed days” means:
Total Non-Medicare Patient Bed Days—Total census days for which Medicare is not the primary payer for the resident's care.
Total Census Days—Represents the sum of the number of residents that were present in the facility during each day of the reporting period. Census information shall be based on a resident's status at midnight at the end of each day. When a resident is on a reserve bed status and a per diem rate is charged, the reserved day(s) shall be included in the Total Census Days.
Hospital-based nursing facility providers shall pay tax at the rate of $5.63 per non-Medicare patient bed day. Note that new hospitals are subject to a 2.5 percent tax on the gross revenues received from hospital services.
Timely returns must be filed even if taxable services were not provided or no tax is due for the period. Do not send a photocopy or facsimile return.
Using a No. 2 lead pencil or black ink, carefully print the numbers inside the boxes according to the example provided at the top of the return. Do not use blue ink, typewritten numbers or dollar signs. Do not write across the face of the return. Round all amounts to the nearest dollar. Taxpayers who have obtained prior approval from the Department of Revenue may file a consolidated return when:
multiple services are provided at one location; or
multiple locations provide the same health care items or services.
The Kentucky health care provider tax is imposed on gross revenues received by all providers for the provision of hospital services, intermediate care facility services for the mentally retarded, licensed home health care agency services, supports for community living services, regional community mental health and mental retardation services, psychiatric residential treatment facility services and Medicaid managed care organization services. Nursing facility services are taxed on non-Medicare patient bed days during the month.
Gross Revenues—Gross revenues include all payments received in money or otherwise from patients, private insurers, third-party payers, HMOs, Medicaid, Medicare or any other source for the provision of health care items or services provided in Kentucky. Any refunds issued during the reporting period that resulted from duplicate payment by insurers and/or patients should reduce gross revenues.
Gross revenues do not include:
revenues received as an employee or through contractual arrangements with a provider subject to the tax;
grants or donations received from federal, state or local government or from an organization recognized as exempt from federal income taxation under Section 501(c)(3) of the Internal Revenue Code for (1) research or for (2) administrative or operating costs associated with the implementation and operation of an experimental program;
any other revenue received that is not for the provision of health care items or services, i.e., cafeteria sales, gift shop sales, vending machine sales, rental of office space, investment income, depositions, medical record reviews for litigation, etc.
Nursing facilities with a total bed capacity of 60 or fewer beds shall pay at the rate of $2.82 per non-Medicare bed patient day. “Total bed capacity” means:
Total Bed Capacity—The combination of licensed nursing home beds, licensed nursing facility beds and licensed intermediate care facility beds.
All other nursing facility providers subject to the tax shall pay at the rate of $6.38 per non-Medicare patient bed day if the facility has annual total census days exceeding 60,000, or $19.89 per non-Medicare patient bed day if the facility has annual total census days equal to or less than 60,000. “Annual total census days” means:
Annual Total Census Days—The number of total census days for the preceding year, calculated on a fiscal year basis.
Per KRS 142.361(1)(d), the rates may be adjusted annually on July 1 of each year by the Department for Medicaid Services. Notification of any rate change shall be provided to the Department of Revenue and to taxpayers in writing at least thirty (30) days prior to the new rate going into effect.
The Kentucky Health Care Provider Tax Return, Revenue Form 73A060, is a machine-readable form. Complete the form provided. Timely returns must be filed even if taxable services were not provided or no tax is due for the period. Do not send a photocopy or facsimile return.
Hospital Services—The term “hospital services” means all inpatient and outpatient services provided by a hospital. “Hospital services” do not include any other taxable services for which the hospital is separately licensed. (See instructions for Lines 2 through 11.)
Licensed Home Health Care Agency Services—The following health care items or services provided by a licensed home health care agency to a recipient at his place of residence and on a physician's orders are considered licensed home health care agency services:
nursing services provided on a part-time or intermittent basis;
home health aid services;
physical therapy, occupational therapy or speech pathology and audiology services; and
medical supplies, equipment and appliances that are suitable for use in the home.