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F I S C A L   I M P A C T   R E P O R T

 

 

 

SPONSOR:

Cordova

 

DATE TYPED:

3/3/03

 

HB

723

 

SHORT TITLE:

Redundancy in Health Facility Regulation

 

SB

 

 

 

ANALYST:

Dunbar

 

APPROPRIATION

 

Appropriation Contained

Estimated Additional Impact

Recurring

or Non-Rec

Fund

Affected

FY03

FY04

FY03

FY04

 

 

 

 

 

Indeterminate

See Narrative

 

 

 

 

 

 

 

 

(Parenthesis ( ) Indicate Expenditure Decreases)

 

SOURCES OF INFORMATION

 

Responses Received From

Department of Health (DOH)

 

SUMMARY

 

     Synopsis of Bill

 

House Bill 723 amends the Public Health Act § 24-1-5.2 NMSA 1978, deleting paragraph c. of section 24-1-5.2. The sole purpose of HB 723 is to eliminate the exemption from intermediate sanctions for violations of state law and regulations that currently is enjoyed by nursing homes that participate in the Medicare and Medicaid programs. 

 

          Significant Issues

 

The bill will afford the DOH  a wider range of sanction imposition and the ability to act on state licensure requirements independently from Federal Center for Medicare and Medicaid Services (CMS). The current language limits the Health Facility, Licensing and Certification Bureau (HFL&C) from imposing expedient actions outside of CMS processes and approval.

 

The federal Medicare and Medicaid agency, the Centers for Medicare and Medicaid Services (CMS), and the Medical Assistance Division, New Mexico Human Services Department, have authority to impose intermediate sanctions against nursing homes for violations of federal certification standards.  But if a nursing home violates a state regulation or law, neither the Department of Health nor any other state or federal agency can impose an intermediate remedy due to the exception found at § 24-1-5.2(C) NMSA 1978.     

 

CMS’s primary function is to impose remedies for federal regulations that permit nursing homes to participate in the receipt of federal Medicaid and Medicare funding. The state has separate statutory and regulatory authority to issue licenses for health facilities such as nursing homes. The state needs an array of intermediate sanction options for its licensure requirements, separate from federal CMS regulations. Currently, the only remedy the state has is revocation of licensure and a slow protracted process of seeking sanctions through the federal regulatory scheme, with no guarantee of federal CMS approval. The amendment also allows the state to impose sanctions in addition to CMS sanctions, particularly in matters where the state does not agree with CMS enforcement actions.

 

With the exception of nursing homes that participate in the Medicaid program, all health care providers in New Mexico are subject to intermediate sanctions for violations of state law and regulations.  This bill would allow the application of intermediate sanctions against Medicaid nursing homes.

 

FISCAL IMPLICATIONS

 

There may be possible small increases in revenue from civil monetary penalties.  On the other hand, costs to the Department of Health would increase when Medicaid nursing homes become subject to intermediate sanctions and are able to request administrative appeals from the imposition of sanctions.

 

ADMINISTRATIVE IMPLICATIONS

 

This bill would provide a greater range of options against Medicaid nursing homes than currently exists. 

 

OTHER SUBSTANTIVE ISSUES

 

The current law exempts the state from imposing intermediate sanctions on federally certified nursing homes other than those available through federal regulations. There is no other facility type that is licensed by HFL&C that receives this exemption, including other federally certified facilities.  Unless approved by slow and unwieldy federal processes, HFL&C has no ability to impose intermediate sanctions—it only has the option of licensure revocation.

 

In one example, HFL&C state regulations require minimum staffing for nursing homes. Federal CMS does not have such requirements. To impose any sanctions on a nursing home for failure to meet these staffing minimums, such sanctions must be cited under a generic federal regulation, then receive approval by CMS. The State HFL&C needs the ability to act independently from CMS and have a range of sanctions for nursing home non-compliance with state regulations without having to rely on the federal scheme.  Such sanctions include: directed plan of correction, facility monitor, and denial of payment for admissions, temporary management and restricted admissions

 

BD/yr:njw