New reimbursement system passes Assembly

PROVIDENCE – Legislation creating a new reimbursement system for nursing homes and establishing parameters to benefit the state’s elderly and disabled populations passed the R.I. General Assembly and was transmitted on June 15 to Gov. Lincoln D. Chafee for his signature.
The legislation, 2012-S 2720A, submitted by Senate Majority Whip Maryellen Goodwin, D-Providence, seeks to ensure quality care and adequate staffing at all long-term care facilities as the state moves to adopt new reimbursement methodology.
The legislation addresses concerns raised by long-term care providers that the Chafee administration’s previously proposed methodology ignored the importance of direct care staffing to provide high quality care. As a result, the new bill establishes required guidelines to which the Department of Human Services must conform, including an incentive to maintain adequate direct nursing staff and the consideration of the cost of caring for higher need patients.
Funding to support this legislation is contained in the newly enacted state budget. The legislation acknowledges that while some nursing homes have higher than average labor costs, others have higher costs in different expenses, such as property taxes or utilities. As a result, all significant cost categories are listed to require a level of recognition in the new funding formula.
The bill includes a provision that limits the amount of gain or loss a facility a facility may receive in the first year. This limitation, set at $5 per patient, per day, would be phased out during a four-year transition. The legislation also requires that homes that would lose funding for direct patient care under the new formula be held harmless, within the $5 per patient/day limit. This provision will not adversely impact any nursing home.