In July, 1974, petitioner established a new 96-bed health related facility (HRF) in New York City. Since it did not have adequate cost experience, respondent State Commissioner of Health established a 1974 prospective Medicaid reimbursement rate pursuant to former 10 NYCRR 86.19. This rate was not based upon cost, but rather based upon allowable projected costs contained in a budget submitted by petitioner prior to opening its facility.
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