The Herald Bulletin

March 12, 2014

Nursing home plan would limit new construction


The Associated Press

INDIANAPOLIS —

 Fewer Indiana nursing homes could be built in the next two years if a proposal to ensure Medicaid patients receive proper care gets final approval in the final days of the legislative session.

The moratorium would cover the state, except for counties where nursing homes are at 90 percent capacity or more and in need of new homes.

Opponents of the measure, including a broad coalition of unions and developers, have said a moratorium would cost the state jobs and violates free market principles. But supporters say limiting the number of nursing homes could ensure Medicaid patients, who often have lower reimbursement rates than Medicare patients, are spread among existing nursing homes and get adequate treatment.

"Most states either have a moratorium or a certificate of need process," said House Speaker Brian Bosma, R-Indianapolis. "While we like to talk about a free market -- and I'm a chief proponent of free market principles -- this is really a controlled market. It's controlled by the government. Some 83 percent of funds received by the nursing home industry come from government. We say what they can charge. We say how many staff they have to have on hand."

Lawmakers from the Indiana House and Senate met Tuesday to hash out concerns that the moratorium would interfere with the free market. Developers, including the son of a powerful House Republican lawmaker, are pushing for rapid growth in anticipation of aging Baby Boomers.

The current version of the bill would exempt counties with nursing homes with at least 90 percent capacity, a compromise for areas with a real need to meet growing demands.

Negotiations throughout the session scaled the program back from a five-year ban to only one year and finally to two years. Nursing homes in development as of June 30 would be exempt from the moratorium.

Whether the abbreviated ban will have a great impact on the growth of nursing homes is unclear. A Legislative Services Agency report shows that might not be enough time to see a decrease in requests to build new homes, and developers might speed through more applications than usual to beat the June deadline this year.

The proposal also aims to tackle other issues of care for the elderly or disabled, including creating a pilot program requiring an Area Agency on Aging to supervise and advocate for patient health.

"It's very difficult to manage these type of services on your own when you have complex medical needs," Family and Social Services Administration Secretary Debra Minott said.

The most recent proposal also would allow a state oversight agency to audit and penalize AAAs for violating the new requirements, adding teeth to the legislation.