NOTE: As provided in LFC policy, this report is
intended only for use by the standing finance committees of the
legislature. The Legislative Finance Committee does not assume
responsibility for the accuracy of the information in this report when used for
other purposes.
The most recent FIR
version (in HTML & Adobe PDF formats) is available on the Legislative
Website. The Adobe PDF version includes
all attachments, whereas the HTML version does not. Previously issued FIRs and attachments may be
obtained from the LFC in
|
SPONSOR: |
Heaton |
DATE TYPED: |
|
HB |
550 |
||
|
SHORT TITLE: |
Statewide Nursing Facility Support |
SB |
|
||||
|
|
ANALYST: |
Weber |
|||||
APPROPRIATION
|
Appropriation
Contained |
Estimated
Additional Impact |
Recurring or
Non-Rec |
Fund Affected |
||
|
FY03 |
FY04 |
FY03 |
FY04 |
|
|
|
|
$3,250.0 |
|
|
Recurring |
General
Fund |
|
|
|
|
|
|
|
(Parenthesis
( ) Indicate Expenditure Decreases)
REVENUE
|
Estimated Revenue |
Subsequent Years Impact |
Recurring or
Non-Rec |
Fund Affected |
|
|
FY03 |
FY04 |
|
|
|
|
|
$9,750.0 |
|
Recurring |
Federal
Funds |
|
|
|
|
|
|
(Parenthesis ( ) Indicate Revenue Decreases)
Responses
Received From
Human
Services Department
Department
of health
SUMMARY
Synopsis of Bill
House
Bill 550 appropriates $3.25 million to the Human Services Department (HSD) from
the General Fund for the purpose of
recruitment, retention, and salary enhancement of direct care providers in
licensed nursing homes. Direct care
providers are registered nurses, licensed practical nurses, and certified
nursing assistants.
Significant
Issues
The Department of Health indicates HB 550 addresses critical
nursing home staff shortages. The NM nursing consortium has estimated shortages
ranging from 12–18% for RNs, LPNs and Nursing Assistants. According to the New Mexico Nursing Home
Association, the $3.25 million appropriation would allow for average salary
increases of approximately $2 per hour.
The
only way Medicaid could pass this funding along to the intended facilities is
through a proportional rate adjustment. There is currently no
way through the required cost reporting to determine whether or not these
additional funds were actually used by the facilities for their intended
purposes.
FISCAL IMPLICATIONS
The appropriation of $3.25
million contained in this bill is a recurring expense to the General fund. Any
unexpended or unencumbered balance remaining at the end of Fiscal Year 2004
shall revert to the General Fund. When
matched with federal funds, the entire funds available are $13 million.
ADMINISTRATIVE IMPLICATIONS
HB 550 would mandate that HSD "ensure that
all money appropriated shall be used only for the purposes
authorized". Consequently, HSD
would be legally required to monitor how the funds are being used by the
licensed nursing facilities and, essentially, guarantee that the funds are
being used as intended. If HSD were
unable to perform this oversight function and ensure that the funds are being
used appropriately, HSD would be in violation of state law. An additional appropriation may be necessary
to provide this oversight function.
OTHER SUBSTANTIVE ISSUES
For FY04 nursing facilities will receive a
projected increase of 2.7%, or almost $4.5 million for Medicaid. This is a Centers for Medicaid and Medicare
(CMS) acceptable increase based on the Market Basket Index (MBI). It would not appear there are other
mechanisms available to provide funds to private nursing facilities except
through the Medicaid program. These additional
funds would need to be incorporated into an alternate annual inflation factor
that is approved by CMS rather than using the current MBI. Also, there are no provisions to determine
what portion of the funds are to go for each purpose; recruitment, retention
and salary enhancement. The bill
specifically prohibits use for administrative purposes and must be spent only
for direct care providers as defined above.
However, the recruitment purpose is typically an administrative function
not performed by direct care providers.
MW/njw:prr