Fiscal Note & Local Impact Statement

126 th General Assembly of Ohio

Ohio Legislative Service Commission

77 South High Street, 9th Floor, Columbus, OH 43215-6136 Phone: (614) 466-3615

Internet Web Site: http://www.lsc.state.oh.us/

BILL:

Sub. S.B. 87

DATE:

November 16, 2005

STATUS:

As Reported by the House Health Committee

SPONSOR:

Sen. Wachtmann

LOCAL IMPACT STATEMENT REQUIRED:

No

No local cost

 


CONTENTS:

Amends the law regarding the provision of hospice care in residential care facilities

 

State Fiscal Highlights

 

STATE FUND

FY 2006

FY 2007

FUTURE YEARS

General Revenue Fund

Revenues

Potential gain or loss

in federal Medicaid reimbursement as a result of an increase or decrease in Medicaid costs

Potential gain or loss

in federal Medicaid reimbursement as a result of an increase or decrease in Medicaid costs

Potential gain or loss

in federal Medicaid reimbursement as a result of an increase or decrease in Medicaid costs

Expenditures

Potential minimal increase or minimal decrease

Potential minimal increase or minimal decrease

Potential minimal increase or minimal decrease

 

        If a person whose need for hospice care and services extends beyond the 120-day limit and were to be transferred to a nursing home or intermediate care facility for the mentally retarded, the bill, by allowing an individual to remain in a residential care facility and receive hospice care and services without a time limit, is likely to save Medicaid costs to the state. If a person would choose to discontinue hospice services because they do not wish to be transferred or discharged and they would be able to stay in the facilities, then the provisions of the bill allowing them to continue services could increase state Medicaid costs. However, it seems that while the provisions of the bill may increase or decrease Medicaid costs, any impact would be minimal since the length of most hospice care is less than 120 days. The state will receive reimbursement of approximately 60% of the Medicaid costs from the federal government.

Local Fiscal Highlights

 

        No direct fiscal effect on political subdivisions.

 


 


 

Detailed Fiscal Analysis

 

Hospice Care in Residential Care Facilities

 

A residential care facility is permitted to provide a limited amount of skilled nursing care to its residents. Specifically, a residential care facility may provide skilled nursing care as follows:

 

(1) Supervision of special diets;
(2) Application of dressings;
(3) Medication administration;

(4) Other skilled nursing care, but only if the care will be provided to a resident on a part-time intermittent basis for not more than 120 days in any 12-month period. The care may be provided by a home health agency, hospice care program, or qualified member of the facility's staff.

 

Therefore, a person residing in a residential care facility who is in need of hospice care and services can, under current law, receive those services but not for more than 120 days in any 12-month period. If a person requires or desires hospice services beyond the 120-day limit, the residential care facility would have to transfer or discharge the resident. If the person does not wish to leave the residential care facility, the hospice care and services may be discontinued.

 

The bill allows a residential care facility to admit and retain an individual who requires hospice care and services and includes hospice care and services among the skilled nursing care that a residential care facility can provide without the 120-day time limitation.

 

Therefore, a person residing in a residential care facility who is in need of hospice care and services can, under the bill, receive those services for as long as needed without being discharged, transferred to another facility, such as a nursing home, or having the services discontinued after 120 days.

 

Fiscal Impact

 

A person whose need for hospice care and services extends beyond the 120-day limit may be transferred to a nursing home or intermediate care facility for the mentally retarded (ICF/MR). If the person is a Medicaid recipient, the cost of providing hospice care and services in a nursing home or ICF/MR is greater than providing the care and services in a residential care facility because Medicaid pays for not only the hospice care and services in a nursing home or ICF/MR but also the cost of room and board. In this scenario, allowing an individual to remain in a residential care facility and receive hospice care and services without a time limit is likely to save Medicaid costs to the state. If a person would choose to discontinue hospice services because they do not wish to be transferred or discharged and they would be able to stay in the facilities, then the provisions of the bill allowing them to continue services could increase state Medicaid costs.

 

However, according to an analysis of services delivered under the Medicaid hospice program prepared by the Auditor of State, the length of stay in the Medicaid hospice program average 52.7 days, with a median of 18 days, and ranged from 1 to 973 days. Therefore, it seems that while the provisions of the bill may increase or decrease Medicaid costs, any impact would be minimal since the length of most hospice care is less than 120 days.

 

Medicaid Voucher Pilot Program

 

Am. Sub. H.B. 66 of the 126th General Assembly (the budget act) requires that the Ohio Department of Job and Family Services (ODJFS) request a federal Medicaid waiver to create a pilot program under which not more than 200 individuals receive spending authorization to pay for the cost of medically necessary "health care services." The spending authorization is to be an amount not exceeding 70% of the average cost of providing nursing facility services to an individual under the Medicaid program.

 

The bill requires that in seeking a waiver to establish the pilot program, ODJFS request that the spending authorization cover the cost of medically necessary "home and community-based services" rather than "health care services."

 

To be eligible for the pilot program, an individual must:

 

(1)   Need an intermediate level of care;

(2)   At the time the individual applies for the pilot program be one of the following:

a.       A nursing facility resident who is seeking to move to a residential care facility or county or district home and who would remain in a nursing facility if not for the pilot program;

b.      A participant of any long-term Medicaid waiver component who would move to a nursing facility if not for the pilot program;

(3)   Meet all other eligibility requirements for the pilot program established in rules.

 

The bill makes changes to the eligibility requirement for the pilot program. First it requires that an individual need at least an intermediate level of care. Second, the bill eliminates the requirement that a nursing facility resident must be seeking to move to a residential care facility or county or district home.

 

Fiscal Impact

 

The bill does not change the number of program participants in the pilot program or the spending authorization limit. Thus, the changes made by the bill to the pilot program should have no fiscal impact on the state Medicaid program.

 

County Boards of Mental Retardation and Developmental Disabilities

 

County boards of mental retardation and developmental disabilities employ "conditional status service and support administrators" to perform case management duties. Under current law, to be employed as a conditional status service and support administrator, a person must hold, at a minimum, an appropriate associate degree.

The bill permits a person who does not have at least an associate degree to be employed as a conditional status service and support administrator if the person (1) was employed by a county board and performed service and support administration duties on June 30, 2005, and (2) holds either a high school diploma or a general educational development (GED) certificate of high school equivalence.

 

Fiscal Impact

 

The Department of Mental Retardation and Developmental Disabilities estimates that this provision will affect about 20 county board employees. This provision would in effect codify existing practice. Therefore, allowing these employees to continue to serve as conditional status service and support administrators would have no fiscal impact on the state or counties.

 

Medicaid Administrative Study Council

 

Am. Sub. H.B. 66 of the 126th General Assembly creates the Medicaid Administrative Study Council to study the administration of the Medicaid program under the assumption that the General Assembly will enact by July 1, 2007, a law establishing a new cabinet level department to administer the program.

 

The enacted budget provides funding of $1,000,000 in FY 2006 and $500,000 in FY 2007 in appropriation item 600-321, Support Services, for the Medicaid Administrative Study Council to carry out the duties of the Council as specified in the law. The enacted budget, however, is silent on the compensation of the council members.

 

The bill adds four new members to the Council who represent the General Assembly, all of which are nonvoting:

 

        Two members of the House of Representatives, one from each political party, both appointed by the Speaker of the House.

        Two members of the Senate, one from each political party, both appointed by the President of the Senate.

 

Fiscal Impact

 

The provision of the bill adds four new members to the Council. As stated above, the budget act is silent on the compensation of the council members. The addition of four members may increase the amount spent from appropriation item 600-321, Support Services, if Council members are reimbursed for travel or other expenses related to their service by the Council. Any potential increase in expenditures for travel are likely to be minimal.

 

 

LSC fiscal staff: Ivy Chen, Economist

 

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