New Nursing Home Operator Reporting Guidance


HUD has issued final guidance on nursing home operator financial statements and extended the related filing deadline.

The Office of Residential Care Facilities (ORCF) has issued guidance on the requirements for Section 232 operators to issue owner-certified financial statements quarterly and at year end.  The Final Rule entitled “Federal Housing Administration (FHA):  Section 232 Healthcare Facility Insurance Program-Strengthening Accountability and Regulatory Revisions Update,” was published September 7, 2012 and became effective October 9, 2012.  The final rule (in 24 CFR 5.801(a) (6) and (d) (4)) requires operators to submit quarterly/year-to-date operator-certified financial statements to the lender and HUD.  To implement this Final Rule, HUD requires operators to submit their quarterly/year-to-date operator-certified financial statements to the lender.

Although the effective date of the Final Rule was October 12, 2012, the financial reporting requirements were deferred until after the publishing of the final requirements in the Federal Register.  These final requirements were published on October 3, 2014, when HUD issued Federal Notice No. FR-5794-N-02 – “Submission of Operator Financial Reports in Accordance with HUD’s Uniform Financial Reporting Standards:  Commencement of Compliance”. Accordingly, ALL Operators must submit their operator financial reports to the lender that services the FHA insured mortgage for the project for fiscal years commencing on or after December 2, 2014.  Such financial statements must contain the following:

  • FHA Number
  • Lender ID
  • Operator Owner
  • Period Ending
  • Months in Period
  • Financial Statement Type
  • Units in Facility
  • Operating Cash
  • Investments
  • Reserve for Replacement Escrow Balance
  • Accounts Receivable
  • Current Assets
  • Current Liabilities
  • Total Revenues
  • Rent/Lease Expense
  • Depreciation Expense
  • Amortization Expense
  • Total Expenses
  • Net Income
  • Reserve for Replacement Deposit
  • FHA Insured Principal Payment
  • FHA Insured Interest Payment
  • Mortgage Insurance Premium

Further, HUD published Interim RuleFederal Housing Administration (FHA):  Section 232 Healthcare Facility Insurance Program – Aligning Operator Financial Reports with HUD’s Uniform Financial Reporting Standards” on September 16, 2014, with an effective date of October 16, 2014.  The rule extends the timeframe for providing quarterly and annual financial statements.

The proposed changes are as follows:

…Unless otherwise specified by HUD, Operator shall submit to HUD and Lender, on a quarterly and year-to-date basis (or more frequently if specified by HUD), prepared and certified by an authorized representative or agent of Operator, such financial reports relating to the operation of the Healthcare Facility (including, but not limited to, financial statements, accounts receivable/payable aging reports and occupancy reports) in the formats and at such times as may be approved by HUD in accordance with Program Obligations.  Such reports must be submitted no later than sixty 60 days after the period covered by the reports, except for reports relating to the final quarter of each year, which shall be submitted no later than ninety 90 days after end of the fiscal year.  Such reports are subject to the sanctions contained in 18 U.S.C. Sections 1001, 1010, and 1012.

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