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foot times the appropriate zip code based index. For the purpose of 1 implementing this section, the value per square foot effective July 2 1, 2016, must be set so that the weighted average fair rental value 3 rate is not less than ten dollars and eighty cents per patient day. 4 The capital component rate allocations calculated in accordance with 5 this section must be adjusted to the extent necessary to comply with 6 RCW 74.46.421. 7 (e) The average age is the actual facility age reduced for 8 significant renovations. Significant renovations are defined as those 9 renovations that exceed two thousand dollars per bed in a calendar 10 year as reported on the annual cost report submitted in accordance 11 with this chapter. For the rate beginning July 1, 2016, the 12 department shall use renovation data back to 1994 as submitted on 13 facility cost reports. Beginning July 1, 2016, facility ages must be 14 reduced in future years if the value of the renovation completed in 15 any year exceeds two thousand dollars times the number of licensed 16 beds. The cost of the renovation must be divided by the accumulated 17 depreciation per bed in the year of the renovation to determine the 18 equivalent number of new replacement beds. The new age for the 19 facility is a weighted average with the replacement bed equivalents 20 reflecting an age of zero and the existing licensed beds, minus the 21 new bed equivalents, reflecting their age in the year of the 22 renovation. At no time may the depreciated age be less than zero or 23 greater than forty-four years. 24 (f) A nursing facility's capital component rate allocation must 25 be rebased annually, effective July 1, 2016, in accordance with this 26 section and this chapter. 27 (g) For the purposes of this subsection (5), "RSMeans" means 28 building construction costs data as published by Gordian. 29 (6) A quality incentive must be offered as a rate enhancement 30 beginning July 1, 2016. 31 (a) An enhancement no larger than five percent and no less than 32 one percent of the statewide average daily rate must be paid to 33 facilities that meet or exceed the standard established for the 34 quality incentive. All providers must have the opportunity to earn 35 the full quality incentive payment. 36 (b) The quality incentive component must be determined by 37 calculating an overall facility quality score composed of four to six 38 quality measures. For fiscal year 2017 there shall be four quality 39 measures, and for fiscal year 2018 there shall be six quality 40 p. 701 ESSB 5187.SL