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Will the states provide "regulatory relief?" (nursing homes)(Column)

In our last column we had Medicaid block grants showing all the prospects for success of our beloved Washington Redskins. OK, so maybe they've done a bit better than that, and may need a last-minute field goal from Bill Clinton to do them in. Regardless of the outcome of the 1995 budget battle, it is clear that the Republican majority in Congress sees itself as elected on a states' rights platform that goes so far as to eliminate the detailed federal regulations of OBRA. Ironically, the majority's determination to do away with OBRA may have been strengthened by Secretary of Health and Human Services Donna Shalala's rejection last June of nursing homes' plea to delay full implementation of the enforcement regulations now rippling - or ripping - their way through the industry.

If not this year, then soon, nursing home administrators may be looking forward to an era without burdensome rules and standards imposed from Washington. Surely the state administrators will be more willing to bend than those hard-shelled folk at HCFA, won't they?

Maybe not.

Telephone interviews with state Medicaid administrators throughout the United States in October revealed that the elimination of OBRA may not mean regulatory relief at all.

The first reaction of many state governments to the prospect of losing detailed federal regulations on quality of care has been to determine whether the state had similar regulations in place prior to OBRA. According to Eddie Anderson, head of the Aging and Adult Services Division of the State of Mississippi, his analysts and analysts in other states currently are researching dusty tomes to rediscover what nursing home regulations were in place during the 1970s. If they do not find regulatory standards, Anderson expects his division will make recommendations on a state substitute for OBRA.

"We do have a concern about the quality of care," said Anderson. "We also have a concern about fifty different levels of quality of care." Anderson was particularly concerned about the prospect of Mississippi paying for care for elderly residents in the facilities of neighboring states that might not share the same standards.

An alternative solution to the issue of losing OBRA standards was offered by Kelly Williams, the chief of Montana's long-term care bureau. Williams believed that her state, with its relatively low reimbursement rates and small elderly population, would experience little pain during a change from OBRA-regulated Medicaid to a more open-ended block grant. One advantage that Montana has over many other states is that it recently combined its survey and reimbursement functions into a single state agency, attempting to ensure consistency of administration. Williams also observes that the nursing home industry's very active representatives in Montana enjoy a good working relationship with her staff.

Williams accepts the need to replace OBRA with something. "We're not looking forward to it," she said, "but, by golly, we'll work through it." She envisions a process of reviewing the OBRA standards to decide which specific items Montana will keep and which are neither practical nor appropriate to the Montana environment. Williams believes that the nursing home industry will be a willing and helpful participant in this process: "Their motivation is making sure that there is good quality of care; it doesn't do them any good to have providers delivering substandard care."

North Dakota and Minnesota present special issues for state regulation because they have instituted equalization of rates for Medicaid and private-pay reimbursement. According to David Zentnor, Medicaid administrator for North Dakota, his state's philosophy is "that we can do things as effectively or more effectively than the federal government." The drive to eliminate OBRA came at a good time for North Dakota, which is currently in the middle of reviewing its state licensing standards for nursing homes. This review will help the state prepare for the process of drafting replacement standards for OBRA regulations. Zentnor added that the loss of OBRA will not compromise the survey process: "We're certainly not going to be in a position where we are going to let the nursing homes tell us what they are going to do and when they want to do it."

Other states, however, view the end of Medicaid-as-we-know-it as a potential disaster for the nursing home industry in their areas. A New England official predicted that the elimination of OBRA "could be tragic...It can cancel all of the gains made over the last several years." If this is coupled with block grants, he predicted, states where relatively generous reimbursement rates for nursing homes compete with medical care for a large population of low-income children and mothers will end up cutting the rates for long-term care providers and discouraging the use of skilled nursing facilities. Such states could include New York, New Jersey, Indiana, Connecticut, Maine, Pennsylvania and Ohio.

One Medicaid official warned of an additional possible consequence of OBRA's loss, if it occurs: the prospect of massive civil liability suits being filed for perceived violation of quality of care in states with a loose regulatory climate. Alabama, for example, was cited as an example of a state where juries traditionally "go after" multistate chains and companies for punitive damages because they see the courts, rather than the state bureaucracy, as the champion of consumer interests.

It's just possible, then, that long-term care providers will look back on the OBRA years as a regulatory Eden.
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Article Details
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Author:Stoil, Michael J.
Publication:Nursing Homes
Article Type:Column
Date:Nov 1, 1995
Previous Article:One voice for subacute.
Next Article:Health care REITs: focus on long-term care.

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