Last Friday the chair of the Health and Human Services Committee in the Senate, Senator David Hann (R-Eden Prairie), passed his omnibus health and human services (HHS) budget bill—S.F. 760—for Fiscal Years 2012-2013 (which begins on July 1, 2011).

As we noted in our email alert to you on March 28th, your actions and contacts made a difference—the Senate HHS Committee amended the original bill to benefit older adult services!!!

As a refresher, the committee chair made the following changes to the original reductions to older adult services:

• Senate removed the onerous provision of the 25% cut to the operating payment rate for categories of PA1 and BC1, fully restoring this proposed cut.
• Senate removed the cut to the first 30-day payment rate, restoring it to 120%.
• Senate modified the Elderly Waiver proposal to reduce cuts from 26 million to 5.8 million, the current level of cuts in the Governor’s budget.

The Senate HHS Omnibus bill was passed out of the full Senate Finance Committee on Monday night, March 28, and the Senate floor on Wednesday, March 30, 2011. There were no significant amendments made to the bill in the Finance Committee. While there were many, many amendments offered to the bill during the marathon floor session on March 30, there was only one amendment related to long term care; it concerns long-term care assessments. An amendment was offered by Senator Julie Rosen that would allow providers, with the permission of the person being assessed or their representative, to submit a copy of the provider’s nursing assessment or written report outlining their recommendations regarding the client’s care needs; and for customized living and 24-hour customized living service rates, the amendment requires the lead agency to receive input from the provider of customized living services to ensure there is a documented need when authorizing component customized living services. This amendment language was agreed to by the Long-Term Care Imperative, Minnesota Council on Health Plans and the Local Public Health Association of Minnesota.

Here is our current understanding of the Senate bill's specific cuts to nursing facilities and the Elderly Waiver program as the bill moves into the next stage, which will be a conference committee to work out the differences between the House bill (yet to pass their Ways and Means Committee and House floor) and this Senate bill.

Nursing Facilities

• Modify non-base rate payments to nursing facilities:
• Elimination of planned closure rate adjustments
• Elimination of all Bed Hold payments
• Elimination of private room incentive for MA recipients in nursing facilities; and nursing facility single bed incentive

Elderly Waiver

• The case mix cap for Elderly Waiver is separated from nursing facility rates, which means in the future when nursing facility rates increase (whether operating or property rates), the elderly waiver rate will not.
• Managing the elderly waiver growth by reducing payments to those with low need; reducing service rate limits for customized living.

Also included in the Senate proposal is the phase out of the rate equalization requirements for nursing facilities, with a phase in at 2% per year for five years. This payment reform is a vital step in the right direction for older adult services. While there continues to be strong advocacy against inclusion of this language, the amendments offered to date to delete or adjust this proposal have not been adopted.

We have to make it very clear that the fixes to the Senate proposed budget are very welcome, but the remaining cuts are damaging to our nursing homes and housing with services which are charged with actually protecting vulnerable people. We estimate that the average reduction under the Senate bill as it stands is -3.32% for nursing facilities and -3.67% for elderly waiver. This is in comparison to the Governor’s budget, which includes an average reduction of -3.9% for nursing facilities and -4.13% for elderly waiver.

If you have questions or comments, please contact Toby Pearson, vice-president of Advocacy at 952-851-2480 or tpearson@careproviders.org.

Toby Pearson
952.851.2480
tpearson@careproviders.org

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