(1) The department of public health and environment may encourage the development of a private grant program to provide start-up funds to nursing home facilities for the purpose of establishing child care centers located in such nursing home facilities.

(2) The state board of health, after consultation with the division in the department of human services involved in licensing child care centers and if the committee formed in section 25-1-1004 recommends the establishment of child care facilities in nursing homes, shall promulgate reasonable rules and regulations establishing any necessary requirements for operating a day care center in a nursing home facility. Such rules and regulations shall include, but need not be limited to, the following:

(a) Requirements for the operation of a safe and good-quality child care operation in the nursing home facility or upon the nursing home facility's grounds, which shall include:

(I) Precautions required to be taken to ensure that all staff and residents who will participate in the intergenerational programs have not been involved in incidents of sexual abuse or child abuse;

(II) Requirements relating to the ability to properly care for the children;

(III) Child care ratios of staff to children;

(IV) Requirements relating to the constant supervision of the children by staff members and not by nursing home residents;

(V) Life safety and fire regulations;

(b) Requirements on the amount and type of liability insurance necessary to insure the risks associated with the child care operation;

(c) Requirements on the ways in which the nursing home residents may be involved in the child care center and the requirement that the participation of nursing home residents in intergenerational activities with the children in the child care operation shall be on a voluntary basis;

(d) Requirements that any fees assessed to the employees of the nursing home facility whose children participate in the child care program will be based on a sliding scale;

(e) Requirements that the participation of employees of the nursing home facility in the enrollment of their children in the intergenerational day care program of the nursing home facility shall be on a voluntary basis.

(3) No medical assistance funds under the "Colorado Medical Assistance Act", articles 4, 5, and 6 of title 25.5, C.R.S., shall be used to subsidize the cost of operating a day care center or day care program in a nursing home facility.