Legislature(1999 - 2000)
04/13/1999 08:03 AM House STA
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* first hearing in first committee of referral
+ teleconferenced
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+ teleconferenced
= bill was previously heard/scheduled
HB 16 - LICENSURE OF ASSISTED LIVING FACILITIES CHAIR JAMES announced that the final item of business would be House Bill No. 16, "An Act transferring to the Department of Health and Social Services the authority to license all assisted living facilities; eliminating the authority of the Department of Administration to license assisted living facilities; and providing for an effective date." Number 0780 REPRESENTATIVE ERIC CROFT, Alaska State Legislature, sponsor, explained that HB 16 was drafted in response to a recommendation by the Office of the Long-Term Care Ombudsman, in particular, their report of investigation from October 3, 1998. One concern was that licensing and operation of the Pioneers' Homes were, at one time, under the exact same division and program. The people who determine the day-to-day operation, and the people that determine whether that operation meets minimum assisted living licensing standards, were "uncomfortably close," creating a perception - and possibly a reality - of a conflict of interest. Representative Croft said it is a legitimate concern that they had tried to fix in a relatively simple way, acknowledging that there aren't any simple answers to these issues. REPRESENTATIVE CROFT told members this is a rapidly growing area of our social infrastructure, particularly in the last five years. The department's position has been that the growth of these homes has taken the pressure off of nursing homes, which are much more expensive. Substantial money can be saved if the assisted living environment is managed, instead of putting people primarily into nursing homes. The department believes, reasonably so, that this is why nursing home numbers haven't grown at this speed. REPRESENTATIVE CROFT noted that there have been discussions of how the state licenses its own operations. He said, "It is inherently one that has elements of conflict of interest in it. But if we don't do it - if we pass some statute that says, 'Because we operate it, we assume we do it well' - we do a fundamental disservice. We ought to recognize the potential for a conflict of interest whenever we are judging our own operation, and at least try and separate those as much as possible from the operation. That's what HB 16, in its current form, does." REPRESENTATIVE CROFT told members there may be many other ideas about better licensing of assisted living homes; this started as a small idea, fixing an issue with the Pioneers' Home. Some discussion needs to happen in this committee, and some he believes would be appropriate for the House Health, Education and Social Services Committee, the bill's next referral. In whichever committee it occurs, this is an area that could stand some scrutiny, he said, either at this narrow level or the more broad public policy level. TAPE 99-23, SIDE A Number 0001 REPRESENTATIVE OGAN commented that there seems to be disparity in the fiscal notes; as he reads it, somebody thinks it is worth a lot more to do the job than it is to get rid of it. He asked whether that is accurate. Number 0021 REPRESENTATIVE CROFT said he thinks it is. He reported that the department is very concerned about doing this job well. If licensure is moved from the Department of Administration, where the Pioneers' Homes are run, into the Department of Health, Education and Social Services (DHSS), the DHSS is very reluctant to take this responsibility on without adequate funding, as they don't believe they currently have the personnel needed to accomplish that task well. That is where much of the fiscal note comes from. Number 0045 CHAIR JAMES asked that testifiers limit comments to three minutes because of time constraints. Number 0057 KAY BURROWS, Director, Division of Senior Services (DSS), Department of Administration, testified via teleconference from Anchorage, noting that her division currently has responsibility for assisted living licensing. She stated: As Representative Croft has just mentioned, we believe the issue is really adequate resources for assisted living, not who does it, or a conflict of interest. The Division of Senior Services had no additional resources given to it in 1995, when this bill, the statute for assisted living, was first passed. DMHDD [Division of Mental Health and Developmental Disabilities] had a small amount. However, between the two of us, we license over 220 assisted living homes in the state today. The growth has been major, as Representative Croft mentioned. We had approximately 45 to 50 homes in 1995, which covered assisted living for seniors. Today, we have over 90 homes, without the [Pioneers'] Homes, which are six. There are more than 130 in DMHDD today. We do support this bill with the attached fiscal notes. And, as Representative [Ogan] mentioned, part of our reasoning for this is that we believe that adequate resources are not currently available, and need to be made available for the growth of this industry. There are four roles for the state in assisted living. They are: licensing of these homes; investigation of the homes; quality monitoring; and capacity development. DSS (indisc.--coughing) its role in all four - for all the homes, not just the [Pioneers'] Homes. We have had a great deal of difficulty getting to quality monitoring and capacity development, due to the increase in licensing and investigation responsibilities. Assisted living licensing and homes is a newly developing business. It is a critical industry for the state, for three reasons: as Representative Croft mentioned, the growth of the senior population, which is considered to be from about 28,000 today to over 80,000 in the year 2015; and the cost of long-term care, if using the current nursing home model, would require public funding of around $72 million in 1996, increasing to $370 million in the year 2015. This is an enormous increase in public funding demands for long-term care, because of the population growth. Assisted living is one of the answers for that. And the third reason is that people needing long-term care want choices. They want more homelike environments and less institutional environments. Home- and community-based care has been a rapidly growing field. Whoever does licensing investigation, therefore, has a growth industry in their hands, with a newly defined type of care and lots of learning for the state to be done. Alaskans are choosing assisted living as a long-term care provider. The state must carefully license and inspect all homes, particularly the non-state-owned homes. This is a broader issue than just the [Pioneers'] Homes and the perceived conflict. It is an important one for our state, and, as Representative Croft has mentioned, it has a number of policy issues. Number 0136 SHELBY LARSEN, Administrator, Health Facilities Licensing and Certification (HFL&C), Division of Medical Assistance, Department of Health and Social Services, testified via teleconference from Anchorage. He said he believes his agency would likely be responsible for licensing of assisted living homes if this bill were to pass. The attached fiscal note was based on their experience doing statewide surveys and certification of health facilities. It was based on the costs involved in travel and doing an annual onsite survey or investigation of each facility. They believe that the fiscal note is reasonable for taking on 225 facilities that are, literally, all over the state. He agreed that this is a rapidly growing industry, one that certainly needs adequate quality control and licensure. Number 0176 CHAIR JAMES commented that if the amount per day doesn't come up from $34.50 for these people, it will be a declining industry, because nobody will be willing to do it. Number 0187 MONTA FAYE LANE, President, Alaska Caregivers Association, testified via teleconference from Fairbanks, noting that she owns two assisted living homes in North Pole. She stated: I think that this assisted living bill, ... HB 16, needs to be moved from the Division of Senior Services, because I believe that it is getting bigger and more costly to the division. And I think that the division needs to concentrate on the care of the seniors in assisted living homes, and not in licensing. Those funds need to come from somewhere else in the state. I don't know where. You guys, that's your job to find it. But I think that Pioneers' Homes and assisted living, under this bill, means to me that we are all the same. You guys down there take care of Pioneers' Homes. Those are state-funded. ... And we in the small homes must meet the same standards as do Pioneers' Homes, but we sure do not have the state benefits, as they do. And I think licensing should clearly be moved. MS. LANE agreed with raising the base rate for assisted living homes. Otherwise, she said, some of the larger, older assisted living homes in this state - which are good assisted living homes - will fall by the way, "because we cannot become a dumping ground for Denali Center, some of the mentally ill that API [Alaska Psychiatric Institute] no longer wants." She said the rate must come up to the $70 a day that they had requested, with a geographical differential; otherwise, it is not going to be that much help. Number 0225 REPRESENTATIVE HUDSON asked whether people living in these homes are able to draw upon Medicaid or other federal funding. MS. LANE replied, "We have some Medicaid clients in our home that's under the new project in the state of Alaska called Project Choice, and we are getting sicker and older people. And we do have a little bit of compensation coming that way for a general relief client, but there is no extra money there for general relief clients, who are still at $34.50 a day in this vicinity here. And that's been the same since 1991. When I obtained my license for the state of Alaska, we were at $30.90 a day. And I wrote some letters to the Division of Youth and Family Services, who were the ones who licensed us at that time, and they gave us a raise to $34.50 a day, and that has remained there since 1992. ... If you live in this Interior, and you have to pay the rising cost of fuel and electricity, you can see that we have not even been (indisc.) with the rate of Social Security increases; had we ... had that for the last 10 or 12 years, we would now be at $68 a day, instead of $34.50." Number 0264 REPRESENTATIVE HUDSON asked, "How many times, in the two homes that you have, have you been inspected over the last two years?" MS. LANE answered, "I have drop-bys all the time from the Division of Senior Services, adult protection agency, and licensing. As for an inspection, I am inspected every year. I am monitored yearly. We also have association meetings in each others' homes, so we do police one another in this area, and we're trying the same thing ... in Anchorage. As far as investigations, I've had a few of them myself, because one time I had someone who made a complaint on me, because they saw some garbage on my porch, which -- we don't have garbage service in North Pole." Number 0296 FRED LAU, Homer Seniors, testified via teleconference from Homer, indicating his organization runs Friendship Terrace, an assisted living facility that is a 40-unit apartment complex with 25 residents. He spoke in opposition to HB 16, from the standpoint that they believe the present licensing is doing an adequate job for assisted living facilities throughout the state. He said they share Representative Croft's concern about the Pioneers' Homes. However, they believe that what is happening now with the Division of Senior Services (DSS) is what was intended to happen: placing all of the senior programs under the DSS. In fact, he said, the long-term care task force had recommended that they not transfer certain aspects to the DHSS without a thorough study of whether that is really needed. MR. LAU suggested that members look at whether the DSS has adequate funding to do the licensing. "But as far as what's being done right now, I think they're doing an adequate job," he added. He then expressed concern that a switch in licensing, while it may place everything together, may also change a philosophy. Assisted living looks at the individual in terms of ability to make choices and maintain independence. Unless there are assurances that if it were transferred to the DHSS there wouldn't be a move towards a medical-clinical model, they are concerned. Mr. Lau explained, "Right now, we're in more of a social model, and we involve families in decisions, and people are allowed to make choices, in terms of what they want to do on a daily basis. And we don't want to see that moved back towards the medical-clinical model, which places more emphasis on clinical personnel making decisions for people." He said that change in focus is the biggest concern. He also expressed concern that he doesn't know the amount of the fiscal note. Number 0335 CHAIR JAMES indicated she would fax Mr. Lau the fiscal notes. She stated her understanding that he sees a problem with the Pioneers' Homes, then asked whether he sees a need to separate the licensing between the Pioneers' Homes and other assisted living homes. MR. LAU clarified that he wasn't implying that there is a problem with the Pioneers' Homes; although stories in the news may suggest there is a problem, he doesn't know whether it is actual or just perceived, as he is not involved in the details. He said he hopes they aren't lumped into this whole thing, and transferred to the DHSS because of the situation that presently exists, looking at the Pioneers' Homes. CHAIR JAMES asked whether Mr. Lau perceives a conflict because the same agency that administers the homes does the licensing. MR. LAU replied, "I don't think that that's a major problem, in my mind. I think those things can be taken care of in other ways. For instance, one of the recommendations from the long-term care task force, I think, was to implement standards, adopt standards from different national organizations. I think those can be put in place, to make sure that some of those problems are taken care of." He referred to the DSS and said he doesn't have a feeling that there is a conflict there, in terms of management. He believes that other agencies and departments that manage facilities have just as much of a conflict, in terms of state-run schools and similar types of facilities. Number 0399 CHAIR JAMES thanked Mr. Lau, then announced that public testimony was concluded. She asked whether the Administration wished to add anything. Number 0409 ELMER LINDSTROM, Special Assistant, Office of the Commissioner, Department of Health and Social Services, told members that assisted living homes are a real success story. Five years ago, there were a handful in the state. The DSS and his department's DMHDD have done a very good job with the responsibility, not only for licensure but for actually increasing the number of facilities in the state, to where now there are hundreds. However, it is a maturing industry, and he doesn't believe it is inappropriate to raise the question of changing the focus - development of homes and creating access - to now perhaps looking at a different sort of regulatory regime that will ensure that these remain viable and safe alternatives to nursing home care. MR. LINDSTROM referred to the fiscal note. He pointed out that it doesn't take many nursing home beds at $100,000-plus per bed, per year, to make the cost of an adequate regulatory regime appear insignificant. Although it is a success story, he said, and they want to continue to see development of these homes, certainly everyone wishes to ensure that they continue to be safe and good alternatives where people can reside. CHAIR JAMES thanked Mr. Lindstrom and concluded the hearing. [HB 16 was held over.]
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