On April 7th, at approximately 2:30 a.m., the Health and Human Services omnibus budget bill (HF927) for fiscal years 2012-2013 (which begins on July 1, 2011) passed off the house floor on a highly partisan roll call vote of 70-62.

The good news: nursing facility changes
The chair of the Health and Human Services Budget Committee, Representative Jim Abeler (R-Anoka), presented the omnibus bill. In his presentation he highlighted the fact that he had “spared nursing homes from across-the-board cuts and limited the cuts to a very small percentage.” The total cuts to nursing homes remaining in the bill are $3.344 million. (We believe the two cuts left are changes to bed hold and bed closures.) This further reduced the nursing facility cuts to a remaining total of $4.389 million or .57 %. The freeze of property rates remained unchanged. (See summary table of the existing cuts below.)

The bad news: Elderly Waiver changes
Chair Abeler did not emphasize the changes to the Elderly Waiver program where he made the overall cuts total $27.3 million or 8.21% (see summary in table of existing cuts below).

Other bad news: CADI waiver changes
There are two provisions that impact the CADI waiver. The first is a cut of $12.7 million in reducing certain congregate living rates, which includes the CADI, DD and TBI waivers. Therefore, we do not know what exact percentage cut this change represents. This proposal is focused on services for individuals with low needs.

The second is freezing CADI, TBI and DD waiver spending. The state share of CADI waiver spending had been projected to total $477,025,923 for fiscal years 2012 and 2013. The proposal to freeze disability waiver spending represents a 26% decrease in projected spending, just over $124,000,000. While we know the number of unduplicated annual recipients for the CADI waiver had been projected to grow from 19,997 to 25,250 over the course of the biennium, we don’t know how the costs would be controlled—continuing caps on the number of participants in these waiver programs or cuts in payments to providers.

House Floor Amendments:
During the course of the floor debate there were several amendments pertaining to older adult services. One amendment was to the section of the proposal for a “global waiver” from CMS. This global waiver is said to carry $300 million in savings to the state. If the savings is not realized, the commissioner of human services is directed to take the $300 million from provider rates across various provider types, including older adult services. In committee we testified against this and we sent a letter to the members with our concerns about this section. On the floor, there was an amendment by Rep. Diane Loeffler (D-Mpls) to ensure that none of this cut could affect provider rates for elderly or disabled. This amendment was adopted.

Second was an amendment by Rep. Tim Kelly (R-Red Wing) which clarified the process and procedures for nursing home consolidations. This amendment was worked on with the Department of Human Services, and was reported on the floor as a response to the growing needs to both update and streamline the locations of nursing homes. This amendment was adopted on a voice vote.

Third was an amendment by Rep. Torrey Westrom (R-Elbow Lake) which would modify the surcharge calculation, beginning in 2013 to apply the surcharge to only those beds which are occupied, licensed beds in nursing homes which are not in layaway. This amendment was adopted as well.

Finally, there was an effort by Rep. Patti Fritz (D-Faribault) to remove the phaseout of rate equalization from the House bill. After a long debate about the history and the merits of the policy of rate equalization, the attempted amendment failed. This leaves us with a strong position in favor of the phaseout of rate equalization in both the Senate and House Omnibus bills.

This bill, as amended, was passed on the final roll call vote 70 – 62.

The House Omnibus bill and the Omnibus Senate bill must now be reconciled in conference committee. In the next couple of days we anticipate each body to name their 3-5 conferees to work on this process. We will continue to update you on the process and composition of the omnibus bills as they move forward. Continue to look for updates in upcoming Action articles. 

Toby Pearson
952.851.2480
tpearson@careproviders.org