General Definition of Supply
An item is considered a supply when it does not meet the definition of “capital” in that it is disposable in a short period of time generally one year or less, can be of diminutive value or is not “durable” in nature rising to the definition of equipment. The term “diminutive value” allows for small and inexpensive items such as serving spoons and brooms to be included with supplies, while larger more complex items that could still be defined as diminutive are classified as minor equipment. The term “diminutive value” should include those items costing $750 or less. Supplies should be coded to the Department of primary use, be it Direct Care, Medical Records, Dietary, Housekeeping, Maintenance, etc. Supplies that are used by multiple departments should be coded to Administrative supplies. Some examples: catheters are coded to Direct Care because Direct Care staff use those supplies; equally, cleaning supplies should be coded to Housekeeping because that department uses those supplies.
A clear delineation between a “supply item” and “equipment” must be made for accurate coding. Therefore, Equipment should be considered any item that is durable in nature, can withstand repeated use and is used in performing a task or providing a service with longer than a year life. Equipment includes items such as pots & pans, signaling devices & battery packs, pressure washer…to name a few. Supplies are not to be capitalized, even if the requirements of WAC 388-96-553 are met.
Direct Care Supplies
Direct Care Supplies are those items that meet the general definition of “Supply” and are used routinely and relatively uniformly in the direct care of a resident by employees or contractors whose cost is part of direct care. This would include items purchased in bulk and distributed to patients in small quantities. This includes all personal care items [e.g. tooth brushes and lotions], over the counter medication [e.g. aspirin or vitamins], those items requiring a physician order [e.g. wound care supplies and catheters], and other nursing items [e.g. manual thermometers, bed mats, and chair pads]. In addition, Direct Care Supplies includes disposable diapers and oxygen for emergency or incidental use if the requirements in Dear Administrator letter ADSA:NH #2007-31 are met.
Direct Care Supplies do not include those items reimbursed by HCA such as, prescription drugs, enteral nutrition, routine use of oxygen and other items listed under HCA.
Activity Supplies are a component of Direct Care Supplies, meet the general definition of “Supply” and include those items used by the designated activity professional in a scheduled activity program. This may include paints, cards, puzzles, party decoration, games, and playing cards. This may also include food when purchased primarily for an activity program and not in replacement of regularly scheduled meals or snacks. Miscellaneous fees related to resident activities such as film rentals and reasonable entertainment honorariums would be classified as Direct Care Purchased Services.
Medical Records Supplies
Medical Records Supplies are a component of Direct Care Supplies, meet the general definition of “Supply” and include those items used by the Medical Records department that are generally not used by another Department. This would include pre-printed forms [e.g. MDS, Care Plan, ADL Charts] used by the Medical Records or Direct Care Staff. This does not include paper purchased in bulk or those items that meet the general definition of “Administrative Supply.”
Social Service Supplies
Social Service Supplies are a component of Direct Care Supplies, meet the general definition of “Supply” and are used by the Social Service department and are generally not used by another Department.
Laundry Supplies include those items meeting the general definition of “Supply” and are used in the laundry by laundry personnel for cleaning, care or repair of facility or personal linens. This may include detergent, fabric softener, soap, bleach, starch, needles and thread. Due to a relatively short life, Laundry Supplies also include linens and towels used in the care of residents. Laundry Supplies also include laundered diapers; disposable diapers are included in Direct Care Supplies.
Laundry Supplies do not include mattresses or draperies as both have a life greater than one year and should generally be capitalized if the requirements of WAC 388-96-553 are met or expensed in account #5486 per WAC 399-96-554.
Housekeeping Supplies include those items meeting the general definition of “Supply” and are used by Housekeeping personnel in maintaining the cleanliness of the physical plant [e.g. disinfectants, germicides, insecticides, polish and other cleaners] or those supplies routinely stocked in toileting facilities [e.g. paper towels, toilet paper, soaps].
Housekeeping Supplies also include items of diminutive value used by housekeeping staff in the process of cleaning such as mops and brooms.
Dietary Supplies include those items meeting the general definition of “Supply” and are used by the Dietary personnel in processing, preparing and serving food. Dietary Supplies include dishes and utensils used by the resident in the consumption of food. Dietary Supplies include standard kitchen items such as dishwashing products, menus, bibs, aprons, trays and serving spoons. Items actually consumed by residents or items that become a component of food consumed by resident should be coded to food.
Administrative Supplies include those items meeting the general definition of “Supply,” are of generally used by all departments, and are not predominately associated with a particular cost center. Some examples include paper purchased in bulk and routine office supplies.
Maintenance Supplies include those items meeting the general definition of “Supply” and are primarily used by maintenance personnel to repair and maintain the physical plant, grounds and equipment. This may include parts required to repair toilets, beds, sprinkler systems and other items. Those items that meet the definition of capital as defined in WAC 388-96-553 shall be capitalized.
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