Revises the application of sanctions and depreciation recapture. Revises the calculation of the direct care component to that it is based on resident-specific RUG rates.

Changes the reimbursement methodology for inpatient acute non-critical access hospital with the implementation of a Medicare Diagnosis Related Group based system.

Increases the supplemental payment pool and for non-critical access hospitals, hospitals reclassified to a wage area outside Marine and rehabilitation hospitals from $51,847,216 to $65,321,301.

Implements the potentially preventable readmission policy.

Revises the reimbursement methodology for inpatient hospital services.

Implements legislative change to clarify the timeframe during which nursing facilities must demonstrate their compliance with the October 2011 Cost-of-Living Adjustment for nursing facility front line staff.

Revises Disproportionate Share Hospital Payments.

Revises the annual disproportionate share hospital payments.

Revises the disproportionate share hospital adjustment methodology for critical and non-critical access hospitals.

Continues the suspension of all direct medical education indirect medical education and catastrophic payments for two years following the effective date of this SPA.