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(b) A minimum occupancy assumption must be applied to indirect 1 care as follows: 2 (i) For fiscal year 2023, the assumption must be 75 percent; 3 (ii) For fiscal year 2024, the assumption must be 80 percent; and 4 (iii) For fiscal year 2025, the assumption must be 80 percent. 5 (5) The capital component must use a fair market rental system to 6 set a price per bed. The capital component must be adjusted for the 7 age of the facility, and must use a minimum occupancy assumption of 8 ninety percent. 9 (a) Beginning July 1, 2016, the fair rental rate allocation for 10 each facility must be determined by multiplying the allowable nursing 11 home square footage in (c) of this subsection by the RSMeans rental 12 rate in (d) of this subsection and by the number of licensed beds 13 yielding the gross unadjusted building value. An equipment allowance 14 of ten percent must be added to the unadjusted building value. The 15 sum of the unadjusted building value and equipment allowance must 16 then be reduced by the average age of the facility as determined by 17 (e) of this subsection using a depreciation rate of one and one-half 18 percent. The depreciated building and equipment plus land valued at 19 ten percent of the gross unadjusted building value before 20 depreciation must then be multiplied by the rental rate at seven and 21 one-half percent to yield an allowable fair rental value for the 22 land, building, and equipment. 23 (b) The fair rental value determined in (a) of this subsection 24 must be divided by the greater of the actual total facility census 25 from the prior full calendar year or imputed census based on the 26 number of licensed beds at ninety percent occupancy. 27 (c) For the rate year beginning July 1, 2016, all facilities must 28 be reimbursed using four hundred square feet. For the rate year 29 beginning July 1, 2017, allowable nursing facility square footage 30 must be determined using the total nursing facility square footage as 31 reported on the medicaid cost reports submitted to the department in 32 compliance with this chapter. The maximum allowable square feet per 33 bed may not exceed four hundred fifty. 34 (d) Each facility must be paid at eighty-three percent or greater 35 of the median nursing facility RSMeans construction index value per 36 square foot. The department may use updated RSMeans construction 37 index information when more recent square footage data becomes 38 available. The statewide value per square foot must be indexed based 39 on facility zip code by multiplying the statewide value per square 40 p. 700 ESSB 5187.SL