[House Report 106-44]
[From the U.S. Government Publishing Office]
106th Congress Report
1st Session HOUSE OF REPRESENTATIVES 106-44
_______________________________________________________________________
NURSING HOME RESIDENT PROTECTION AMENDMENTS OF 1999
_______
March 8, 1999.--Committed to the Committee of the Whole House on the
State of the Union and ordered to be printed
_______________________________________________________________________
Mr. Bliley, from the Committee on Commerce, submitted the following
R E P O R T
[To accompany H.R. 540]
The Committee on Commerce, to whom was referred the bill
(H.R. 540) to amend title XIX of the Social Security Act to
prohibit transfers or discharges of residents of nursing
facilities as a result of a voluntary withdrawal from
participation in the Medicaid Program, having considered the
same, report favorably thereon without amendment and recommend
that the bill do pass.
CONTENTS
Page
Purpose and Summary.............................................. 1
Background and Need for Legislation.............................. 2
Hearings......................................................... 4
Committee Consideration.......................................... 4
Rollcall Votes................................................... 5
Committee Oversight Findings..................................... 5
Committee on Government Reform Oversight Findings................ 5
New Budget Authority, Entitlement Authority, and Tax Expenditures 5
Committee Cost Estimate.......................................... 5
Congressional Budget Office Estimate............................. 5
Federal Mandates Statement....................................... 7
Advisory Committee Statement..................................... 7
Constitutional Authority Statement............................... 7
Applicability to Legislative Branch.............................. 7
Section-by-Section Analysis of the Legislation................... 7
Changes in Existing Law Made by the Bill, as Reported............ 8
Purpose and Summary
The purpose of H.R. 540, the Nursing Home Resident
Protection Amendments of 1999, is to amend title XIX of the
Social Security Act to prohibit transfers or discharges of
residents of nursing facilities as a result of a voluntary
withdrawal from participation in the Medicaid Program.
H.R. 540 affords protection from discharge or transfer
based on Medicaid status to residents of nursing homes which
decide to withdraw from the Medicaid program. The residents
protected include those who are presently receiving Medicaid
benefits in nursing homes, as well as those patients who are
already residents but not yet dependent on Medicaid.
For those individuals who take up residence in the nursing
home after the effective date of the facility's withdrawal from
the Medicaid program, H.R. 540 provides that they must be
informed orally and in writing that the nursing home may
transfer or discharge the resident once the resident is unable
to pay the charges of the facility through non-Medicaid
sources.
Background and Need for Legislation
H.R. 540 was introduced to respond to the practice of
targeting Medicaid recipients for eviction from nursing homes.
In April 1998, a nursing home operated by Vencor, Inc. in
Tampa, Florida, attempted to evict 52 Medicaid residents
ostensibly for the purpose of remodeling the nursing home
facility. A judge halted the evictions, and the nursing home
allowed the residents to remain. A State agency concluded that
the evictions were based solely on the fact that these
residents relied on Medicaid to pay their nursing home bills.
Since that time, Vencor reversed its actions in Tampa and
invited back all the discharged patients. In the Vencor case,
Medicaid patients were protected by current law and regulations
because the Vencor facility continued to participate in the
Medicaid program. However, other facilities that have withdrawn
from the Medicaid program are free to evict Medicaid patients.
Over time, many residents of nursing homes are expected to
exhaust their financial resources and become eligible for
Medicaid coverage. According to some estimates, the rate of
exhaustion of resources among the elderly for nursing home care
is 63 percent over 13 weeks, 87 percent over 52 weeks.
Medicaid, a partially Federally funded welfare program
administered by the States, is not available to individuals
until and unless they have limited assets and monthly incomes.
Medicaid may be used to pay for nursing home care provided the
nursing home has elected to participate in the Medicaid
program.
Providers do not often leave the Medicaid program. The
large portion of Medicaid beneficiaries among the overall
nursing home population (often over 60 percent of occupancy)
and the general financial dependence of many homes on Medicaid
revenues makes voluntary withdrawal an uncommon occurrence.
When termination of participation does occur, it is usually
caused by (1) a termination action by the State or Federal
government, (2) a failure of the facility to meet
recertification requirements for renewal of the provider
agreement, or (3) in rare instances, the inadequacy of the
payment structure under Medicaid. It is relatively uncommon for
a nursing home to withdraw from the Medicaid program
voluntarily, since Medicaid beds provide the majority of the
revenue stream for most facilities. The Health Care Financing
Administration (``HCFA'') estimates that an average of 58
nursing homes voluntarily withdraw from the Medicaid program
each year out of approximately 17,000 nursing homes in the
United States.
Notwithstanding the relatively few nursing homes that
withdraw from the Medicaid program each year, ``[N]ursing
`homes' become just that,'' according to the testimony provided
by James L. Martin, President, The 60 Plus Association, at the
February 11, 1999, Subcommittee on Health and Environment
hearing on H.R. 540, ``They are not a hospital room, nor a
hotel room, they are `home' to these patients * * *. Attrition,
not eviction, should be the rule, so indigent patients do not
suffer relocation trauma.''
In an informal survey conducted by HCFA of forty-seven
State nursing home ombudsmen, fifteen cited transfer and
discharge violations as highly problematic. According to a
February 8, 1999, letter to Health and Environment Subcommittee
Chairman Michael Bilirakis in support of H.R. 540 from Geme G.
Hernandez, Florida Secretary of Elder Affairs, ``The evidence
is overwhelming that, without extraordinary preparatory efforts
that are hardly ever made, any move is harmful for the
preponderance of the frail elderly; the technical term is
`transfer trauma.' ''
Current law protects seniors from unreasonable transfer
and discharge only if the nursing home remains in the Medicaid
program. Section 1919 of the Social Security Act (42 U.S. C.
1396r) sets forth transfer and discharge rules a skilled
nursing facility must follow when transfer or discharge is
under consideration.
Under section 1919(c)(2), a skilled nursing facility must
permit each resident to remain in the facility and must not
transfer or discharge the resident from the facility unless:
(i) the transfer or discharge is necessary to meet
the resident's welfare and the resident's welfare
cannot be met in the facility;
(ii) the transfer or discharge is appropriate because
the resident's health has improved sufficiently so the
resident no longer needs the services provided by the
facility;
(iii) the safety of individuals in the facility is
endangered;
(iv) the health of individuals in the facility would
otherwise be endangered;
(v) the resident has failed, after reasonable and
appropriate notice, to pay (or to have paid under this
title or title XVIII on the resident's behalf) for a
stay at the facility; or
(vi) the facility ceases to operate.
Nursing homes are required to accept Medicaid payment as
payment in full for nursing home residents. Additionally,
notice must be given at least 30 days prior to the transfer or
discharge of a resident.
H.R. 540 closes the loophole of nursing homes seeking to
discharge or transfer patients based solely on their Medicaid-
eligible status. According to a February 8, 1999, letter to
Health and Environment Subcommittee Chairman Michael Bilirakis
from Horace B. Deets, Executive Director of the American
Association of Retired Persons (``AARP''), ``H.R. 540
establishes clear legal authority to prevent inappropriate
discharges, even when a nursing home withdraws from the
Medicaid program. AARP believes this is an important and
necessary step in protecting access to nursing homes for our
nation's most vulnerable citizens.''
If a nursing facility were to decide to withdraw
voluntarily from the Medicaid program, all residents of the
facility prior to such a decision would be protected from
transfer or discharge based on Medicaid status, regardless of
whether they are Medicaid-eligible at the time or become
eligible in the future.
According to testimony delivered by Mike Hash, Deputy
Administrator, Health Care Financing Administration at the
February 11 hearing, ``without the legislation that you,
Chairman Bilirakis, and Congressman Davis, have introduced, we
cannot prevent the evictions of Medicaid patients if nursing
homes leave participation in Medicaid. America's nursing home
residents need this bill to be enacted into law * * *. I know
that our staff has provided technical assistance to your staff
and others in the drafting of this legislation. We look forward
to working with you to further ensure passage of this bill * *
* .''
As Nona Bear Wegner, Senior Vice President, The Seniors
Coalition, put it in a March 1, 1999, letter to Health and
Environment Subcommittee Chairman Michael Bilirakis, ``We
believe that this is a very fair and balanced piece of
legislation which protects consumers while, at the same time,
poses no unreasonable burden of compliance upon providers of
care. Rather, it is a measure which will actually boost
consumer confidence in the nursing home industry by providing
patients and families with certain knowledge that care will not
be unreasonably interrupted or withdrawn.''
Hearings
The Subcommittee on Health and Environment held a hearing
on H.R. 540, the Nursing Home Resident Protection Amendments of
1999, on February 11, 1999. The Subcommittee received testimony
from: the Honorable Jim Davis, U.S. House of Representatives,
Eleventh Congressional District, State of Florida; Michael
Hash, Deputy Administrator, Health Care Financing
Administration; Nelson Mongiovi of Tampa, Florida; Nona Bear
Wegner, Senior Vice President, The Seniors Coalition; James L.
Martin, President, 60 Plus; Kelley Schild, Administrator,
Floridian Nursing and Rehabilitation Center, testifying on
behalf of the American Health Care Association; and Robyn
Grant, Severns & Bennet, representing the National Coalition
for Nursing Home Reform.
Subcommittee Chairman Bilirakis entered into the record
letters in support of H.R. 540 from AARP, the National Senior
Citizens Law Center, the Florida Department of Elder Affairs,
and the American Health Care Association.
Committee Consideration
On March 2, 1999, the Subcommittee on Health and
Environment met in open markup session and approved H.R. 540
for Full Committee consideration, without amendment, by a voice
vote. On March 4, 1999, the Full Committee met in open markup
session and ordered H.R. 540 reported favorably to the House,
without amendment, by a voice vote, a quorum being present.
Rollcall Votes
Clause 3(b) of rule XIII of the Rules of the House requires
the Committee to list the recorded votes on the motion to
report legislation and amendments thereto. There were no
recorded votes taken in connection with ordering H.R. 540
reported. A motion by Mr. Bliley to order H.R. 540 reported to
the House, without amendment, was agreed to by a voice vote, a
quorum being present.
Committee Oversight Findings
Pursuant to clause 3(c)(1) of rule XIII of the Rules of the
House of Representatives, the Committee held a legislative
hearing and made findings that are reflected in this report.
Committee on Government Reform Oversight Findings
Pursuant to clause 3(c)(4) of rule XIII of the Rules of the
House of Representatives, no oversight findings have been
submitted to the Committee by the Committee on Government
Reform.
New Budget Authority, Entitlement Authority, and Tax Expenditures
In compliance with clause 3(c)(2) of rule XIII of the Rules
of the House of Representatives, the Committee finds that H.R.
540, Nursing Home Resident Protection Amendments of 1999, would
result in no new or increased budget authority, entitlement
authority, or tax expenditures or revenues.
Committee Cost Estimate
The Committee adopts as its own the cost estimate prepared
by the Director of the Congressional Budget Office pursuant to
section 402 of the Congressional Budget Act of 1974.
Congressional Budget Office Estimate
Pursuant to clause 3(c)(3) of rule XIII of the Rules of the
House of Representatives, the following is the cost estimate
provided by the Congressional Budget Office pursuant to section
402 of the Congressional Budget Act of 1974:
U.S. Congress,
Congressional Budget Office,
Washington, DC, March 5, 1999.
Hon. Tom Bliley,
Chairman, Committee on Commerce,
House of Representatives, Washington, DC.
Dear Mr. Chairman: The Congressional Budget Office has
prepared the enclosed cost estimate for H.R. 540, Nursing Home
Resident Protection Amendments of 1999.
If you wish further details on this estimate, we will be
pleased to provide them. The CBO staff contacts are Jeanne De
Sa and Dorothy Rosenbaum.
Sincerely,
Barry B. Anderson
(for Dan L. Crippen, Director).
Enclosure.
H.R. 540--Nursing Home Resident Protection Amendments of 1999
CBO estimates that enactment of H.R. 540 would not affect
federal spending. Because the bill would not affect direct
spending or receipts, pay-as-you-go procedures would not apply.
H.R. 540 contains no intergovernmental mandates as defined in
the Unfunded Mandates Reform Act of 1995 (UMRA) and would not
affect the budgets of state, local, or tribal governments. The
bill does contain a private-sector mandate on nursing
facilities currently participating in the Medicaid program, but
the cost of that mandate to the affected facilities would be
small.
H.R. 540 would amend Medicaid law to prohibit transfers or
discharges of residents of nursing facilities as a result of a
facility's voluntary withdrawal from participation in the
Medicaid program. The bill would not affect federal Medicaid
spending because nursing facility residents would be likely to
continue to receive Medicaid benefits if a facility withdraws
from the program under both current law and the bill's new
requirements.
Current Medicaid law includes a set of requirements
regarding residents' transfer and discharge rights for nursing
facilities that participate in the Medicaid program and
establishes mechanisms that states and the federal government
may use to punish violation of those requirements. The bill
would add a new requirement that a participating facility agree
that in the event that it decides to withdraw from the Medicaid
program in the future, it would continue to care for residents
who were in its care at the time. In that instance, the
facility would be deemed to be participating in the Medicaid
program and would continue to receive payments for residents
who were in its care at the time of withdrawal until the legal
discharge or transfer of those residents. The requirement would
apply only to facilities that continue to provide nursing
facility services.
CBO estimates that this bill would not affect federal
Medicaid spending. Because nursing facilities are highly
dependent on Medicaid revenue, it is unlikely that there would
be a largescale withdrawal from Medicaid program participation
under current law. Furthermore, in many states, withdrawal from
the Medicaid program carries risk of civil monetary penaltiesor
other sanction. For instance, some states require Medicaid
participation as a condition of licensure. Even in the rare instance
where a facility does withdraw from the program under current law, the
state or the Health Care Financing Administration would likely find new
placement for Medicaid-eligible residents. As national occupancy rates
in nursing facilities are about 86 percent, it would be unlikely that a
new placement would not be found.
CBO finds that the new requirements of H.R. 540 would be
considered a private-sector mandate under UMRA. For facilities
now participating in Medicaid who chose to leave the program,
the requirement to continue to care for current residents would
be a new duty they could not avoid, even though it was not part
of their agreement when they joined the program. Because few
nursing facilities leave the program, however, and because
those who did choose to leave would continue to receive
Medicaid payments, the aggregate cost to affected facilities of
this mandate would be small.
The CBO staff contacts for the federal costs of this
estimate are Jeanne De Sa and Dorothy Rosenbaum. Bruce
Vavrichek is the staff contact for private sector mandate
costs. This estimate was approved by Paul N. Van de Water,
Assistant Director for Budget Analysis.
Federal Mandates Statement
The Committee adopts as its own the estimate of Federal
mandates prepared by the Director of the Congressional Budget
Office pursuant to section 423 of the Unfunded Mandates Reform
Act.
Advisory Committee Statement
No advisory committees within the meaning of section 5(b)
of the Federal Advisory Committee Act were created by this
legislation.
Constitutional Authority Statement
Pursuant to clause 3(d)(1) of rule XIII of the Rules of the
House of Representatives, the Committee finds that the
Constitutional authority for this legislation is provided in
Article I, section 8, clause 3, which grants Congress the power
to regulate commerce with foreign nations, among the several
States, and with the Indian tribes.
Applicability to Legislative Branch
The Committee finds that the legislation does not relate to
the terms and conditions of employment or access to public
services or accommodations within the meaning of section
102(b)(3) of the Congressional Accountability Act.
Section-by-Section Analysis of the Legislation
Section 1. Short Title
Section 1 provides the short title of the Act, the
``Nursing Home Resident Protection Amendments of 1999.''
Section 2. Restrictions on Transfers or Discharges of Nursing Facility
Residents in the Case of Voluntary Withdrawal from Participation under
the Medicaid Program
Section 2 provides for restrictions on transfers or
discharges of nursing facility residents in the case of
voluntary withdrawal from participation under the Medicaid
program. In general, this section provides that a nursing
home's voluntary withdrawal from the Medicaid program is not an
acceptable basis for the transfer or discharge based on
Medicaid status of individuals who had taken up residence in
the facility on the day before the effective date of
withdrawal, including those who were not Medicaid eligible at
that time. In the case of each individual who takes up
residence in the nursing home after the effective date of such
withdrawal, the nursing home must provide notice both orally
and in writing that the nursing home will no longer participate
in the Medicaid program. This section further identifies what
constitutes notice and acknowledgments of notice. The effective
date is the date of enactment of the Act.
Changes in Existing Law Made by the Bill, as Reported
In compliance with clause 3(e) of rule XIII of the Rules of
the House of Representatives, changes in existing law made by
the bill, as reported, are shown as follows (existing law
proposed to be omitted is enclosed in black brackets, new
matter is printed in italic, existing law in which no change is
proposed is shown in roman):
SECTION 1919 OF THE SOCIAL SECURITY ACT
REQUIREMENTS FOR NURSING FACILITIES
Sec. 1919. (a) * * *
* * * * * * *
(c) Requirements Relating to Residents' Rights.--
(1) * * *
(2) Transfer and discharge rights.--
(A) * * *
* * * * * * *
(F) Continuing rights in case of voluntary
withdrawal from participation.--
(i) In general.--In the case of a
nursing facility that voluntarily
withdraws from participation in a State
plan under this title but continues to
provide services of the type provided
by nursing facilities--
(I) the facility's voluntary
withdrawal from participation
is not an acceptable basis for
the transfer or discharge of
residents of the facility who
were residing in the facility
on the day before the effective
date of the withdrawal
(including those residents who
were not entitled to medical
assistance as of such day);
(II) the provisions of this
section continue to apply to
such residents until the date
of their discharge from the
facility; and
(III) in the case of each
individual who begins residence
in the facility after the
effective date of such
withdrawal, the facility shall
provide notice orally and in a
prominent manner in writing on
a separate page at the time the
individual begins residence of
the information described in
clause (ii) and shall obtain
from each such individual at
such time an acknowledgment of
receipt of such information
that is in writing, signed by
the individual, and separate
from other documents signed by
such individual.
Nothing in this subparagraph shall be
construed as affecting any requirement
of a participation agreement that a
nursing facility provide advance notice
to the State or the Secretary, or both,
of its intention to terminate the
agreement.
(ii) Information for new residents.--
The information described in this
clause for a resident is the following:
(I) The facility is not
participating in the program
under this title with respect
to that resident.
(II) The facility may
transfer or discharge the
resident from the facility at
such time as the resident is
unable to pay the charges of
the facility, even though the
resident may have become
eligible for medical assistance
for nursing facility services
under this title.
(iii) Continuation of payments and
oversight authority.--Notwithstanding
any other provision of this title, with
respect to the residents described in
clause (i)(I), a participation
agreement of a facility described in
clause (i) is deemed to continue in
effect under such plan after the
effective date of the facility's
voluntary withdrawal from participation
under the State plan for purposes of--
(I) receiving payments under
the State plan for nursing
facility services provided to
such residents;
(II) maintaining compliance
with all applicable
requirements of this title; and
(III) continuing to apply the
survey, certification, and
enforcement authority provided
under subsections (g) and (h)
(including involuntary
termination of a participation
agreement deemed continued
under this clause).
(iv) No application to new
residents.--This paragraph (other than
subclause (III) of clause (i)) shall
not apply to an individual who begins
residence in a facility on or after the
effective date of the withdrawal from
participation under this subparagraph.
* * * * * * *