BILL ANALYSIS Ó
AB 2079
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Date of Hearing: April 27, 2016
ASSEMBLY COMMITTEE ON APPROPRIATIONS
Lorena Gonzalez, Chair
AB
2079 (Calderon) - As Amended April 18, 2016
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Urgency: No State Mandated Local Program: YesReimbursable:
No
SUMMARY:
This bill increases the minimum staffing standards in skilled
nursing facilities (SNFs) from 3.2 hours to 4.1 hours.
Specifically, this bill:
1)Beginning July 1, 2017, mandates minimum staff-to-patient
ratios for certified nursing assistants (CNAs).
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2)Beginning January 1, 2018, increases the current minimum ratio
of 3.2 nursing hours per patient day to 4.1 direct care hours
per patient day, which include separate, specific minimum
ratios for licensed nurses and CNAs as part of the overall
ratio. The specific ratios for licensed nurses and CNAs would
be minimums of 1.3 hours and 2.8 hours per patient day,
respectively.
3)Retains the current 3.2 hour per patient day requirement for
any skilled nursing facility that is a distinct part of a
facility licensed as a general acute care hospital.
4)Expands the definition of direct caregiver services to clarify
the activities that qualify as direct caregiver hours.
5)Modifies facility posting requirements regarding staffing and
resident census.
6)Requires the California Department of Public Health (CDPH) to
adopt regulations consistent with the specified minimum
levels.
7)Adds, beginning in the 2017-18 fiscal year, compliance with
the direct care service hour requirements for SNFs as a
performance measure in a supplemental payment program.
FISCAL EFFECT:
1)Under current law, Medi-Cal payment rates to skilled nursing
facilities are calculated using a facility-specific cost-based
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system. This rate development process requires the Department
of Health Care Services (DHCS) to increase the rates to
skilled nursing facilities to offset the projected cost of
complying with new state or federal mandates. Based on this
requirement, and using their facility-specific model, the
California Association of Health Facilities (CAHF) projects
annual Medi-Cal costs for increased reimbursement to SNFs, of
$106 million in 2017, $391 million in 2018, and increasing
annually until 2022 and thereafter when costs are projected at
$462 million annually (50% GF/ 50% federal).
2017 costs are relatively lower because of a July 1, 2017,
implementation date for CNA shift ratios, while the bill's
other mandates are fully implemented January 1, 2018. Costs
in 2022 also reflect full implementation of an increased
minimum wage to $15 pursuant to SB 3 (Leno, De León, and
Leyva), Chapter 4, Statutes of 2016. This estimate assumes
the minimum wage increases are implemented as scheduled
without a "pause" for budget or economic reasons. Each extra
dollar of minimum wage appears to translate to approximately
$18 million in increased Medi-Cal costs (GF/federal), so for
any year in which the wage increase was delayed, Medi-Cal
reimbursement would be lower commensurate with the delay.
2)Unknown potential GF costs to the Department of State
Hospitals (DSH) for additional staff. DSH operates three
skilled nursing units as part of the state hospital system.
Because state hospitals are licensed as psychiatric hospitals,
the skilled nursing facilities operated by DSH are not
eligible for the exemption granted in the bill for skilled
nursing facilities that are a distinct part of a general acute
care hospital. The cost for DSH to comply with the mandated
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direct care hours in the bill is unknown, in part because the
nature of the patient population in the state hospital system
generally requires more staffing than is typical in a normal
skilled nursing facility. In addition, DSH uses psychiatric
technicians instead of CNAs so the applicability of the ratios
specific to CNAs are unclear.
3)One-time costs in the range of $100,000 to adopt regulations
and modify internal tracking systems by CDPH (Licensing and
Certification Fund).
4)Minor additional ongoing enforcement costs to CDPH (Licensing
and Certification Fund). The department already licenses
SNFs, including compliance with existing nursing hours
requirements, and the increased workload is not expected to be
significant.
COMMENTS:
1)Purpose. According to the author, the current minimum of 3.2
hours per patient per day staffing requirements for SNFs does
not meet the direct care needs of nursing home residents.
This chronic understaffing of CNAs in SNFs creates unsafe
living conditions for the residents and stressful workplace
conditions for staff.
2)Background. SNFs care for individuals who are elderly,
recovering from illness or injury, or have special needs such
as developmental or mental disabilities. They can be
freestanding or operated a part of a hospital (often called
distinct-part SNFs). This bill applies to freestanding SNFs
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and excludes distinct-part SNFs from its requirements for
higher staffing levels. Medi-Cal pays for about two thirds of
all patient days in SNFs, making Medi-Cal reimbursement policy
critical to the financial viability of most SNFs.
3)SNF Reimbursement. The current Medi-Cal rate methodology is
facility-specific and cost-based. It is a complicated
methodology which reimburses facilities based on various cost
categories, up to certain caps, and subject to peer grouping
provisions. Since a SNF level of care is labor-intensive,
labor makes up the largest cost category. Current law also
ensures facilities are reimbursed for any additional costs of
federal or state mandates, such as the increase in direct care
nursing hours proposed by this bill. For example, the
recently passed minimum wage increase will be factored into
reimbursement. Prior to the availability of cost reports that
reflect the increased costs experienced by the facility as a
result of a mandate, facilities receive an "add-on" that is
reflective of 100% of the projected costs of the mandate.
4)Minimum staffing requirements. Currently facilities are
required to staff throughout the day in order to achieve
minimum standards, but are also required to employ and
schedule additional staff based on patient care needs. The
current minimum of 3.2 nursing hours per patient day does not
mean that each patient receives 3.2 hours of care each day,
but is instead the total number of nursing hours performed by
direct caregivers, divided by the average patient census. The
current average staffing level across facilities is equivalent
to 3.7 nursing hours per day, higher than the 3.2 minimum,
though this varies according to facility. This bill requires
both minimum staff-to-patient ratios for each shift as well as
a minimum level of direct care service hours per patient day.
A noteworthy difference between the current minimum and this
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proposal is the separate minimums that are embedded inside the
4.1 direct care service hour requirement. The current
minimum is for a combined total of 3.2 hours, while this bill
specifies two separate ratios within the single 4.1 hour
requirement (1.3 hours for licensed nurses and 2.8 hours for
CNAs). Under this bill, for example, hours of care provided
an RN, even though they are more highly trained, cannot
substitute for hours provided by a CNA. The CNA hours
requirement is expected to result in a substantial increase in
demand for CNAs. CAHF has provided an estimate indicating
this would increase the CNA workforce in SNFs by over 10,000,
a 30% increase over current levels.
5)Support. SEIU California, sponsor of this measure, states that
providing person-centered care in SNFs requires time and
sufficient staff. The California Labor Federation, Congress
of California Seniors, and California Long-Term Care Ombudsman
Association also support this bill.
6)Opposition. The California Association of Health Facilities
(CAHF) writes in opposition that this measure would create
artificial staffing patterns that do not necessarily lead to
higher quality patient care, that it would be expensive to
implement, and that would be a huge challenge for SNFs to find
the necessary staff to comply with the staffing mandates of
this bill. Leading Age California and the Association of
California Healthcare Districts are also opposed.
Analysis Prepared by:Lisa Murawski / APPR. / (916)
319-2081
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