Despite concerns from the departments of Health and Human Services, Hawaii lawmakers are pushing forward bills that would help the adult care-home industry make more money while potentially compromising the quality of services provided to those most in need.

Residential care facilities serve thousands of residents in hundreds of homes statewide, but operators say they have struggled to make ends meet because state payments have failed to keep pace with increasing costs.

In a budget year with limited discretionary spending, the Legislature has mostly shelved solutions that would come out of taxpayers’ pockets. But the alternatives have raised eyebrows and created uncertainty.

Hawaii State Capitol second floor. 29 jan 2015 photograph Cory Lum/Civil Beat

Lawmakers are working in the Capitol to address numerous concerns facing the adult care home industry.

Cory Lum/Civil Beat

House Bill 600 changes the ratio of Medicaid to private-pay clients who are allowed in community care family foster homes, known as CCFFHs.

The state currently lets this type of home have up to three clients. Two must be on Medicaid and one can pay out of his or her own pocket.

The bill would flip this by allowing two private-pay clients and one Medicaid recipient, which could leave the poor with fewer places to go for long-term care — something health officials highlighted and supporters of the legislation acknowledged.

Testimony on the bill from care home operators overwhelmingly shows they want it to pass to help them bring in more income, which they say would allow them to improve services and help them avoid having to get a second job.

Vice Speaker John Mizuno, whose name is on virtually every care home bill, maintains that this one is all about helping married couples live together.

Mizuno and care home operator Jonathan Hanks have used Hanks’ client, veteran Noboru Kawamoto, as the impetus to change the law. Kawamoto pays out of his own pocket, which means his wife of 67 years can’t live in that home with him.

Rather than finding another facility that would allow them to live together, they are pushing to have the law changed to allow two private-pay clients in one CCFFH.

In response to this particular concern, the bill was amended last month to only allow a married couple to be the two private-pay clients a CCFFH can serve.

This failed to alleviate the Health Department’s concerns though.

The department told lawmakers Thursday that it’s “highly desirable” to allow nursing-level-of-care couples in an “objectively verifiable relationship” to live their latter days together in a CCFFH but the legislation remains problematic.

Currently, licensed care home operators set their own fee schedules without the department’s scrutiny or regulation and they contract with payors as they wish. The department worries that this bill changes that and could establish a precedent for its other licensure programs.

The department is also worried about what happens to the Medicaid recipients for which the CCFFH program was established to serve. Health officials have said they are concerned that the care homes, if allowed to have two private-pay clients, won’t need to accept someone on Medicaid because they’ll be making more than enough money without them and fewer beds will be available.

The Finance Committee, chaired by Rep. Sylvia Luke, passed the bill without making any additional changes. It goes to a vote before the full House next.

More Clients Per Home

House Bill 1195 would let the Health Department continue doing something it was supposed to stop doing two years ago — allowing three nursing-facility level residents in an expanded adult residential care home, or E-ARCH.

The care home industry fought for this change in 2010 and succeeded in getting the bill passed over the concerns of health officials who were worried about lessening the level of care each client would receive if there were more people in each home. The law sunset in 2013, but the Department of Health has continued to allow it anyway.

The department’s Office of Health Care Assurance, headed by Keith Ridley, told lawmakers this week that there are 236 homes of this type licensed in Hawaii. Over the past few years, the department has approved 94 percent of the 125 requests it received to add an additional bed. In 2014, 10 of the 12 applications were approved.

Concerned about the welfare of residents in these homes, the office asserts that it has implemented additional criteria to ensure each facility is performing well. And with that in mind, the department says it doesn’t believe the bill is necessary since it would just enable something already being done.

The bill has cleared three committees without substantive changes being made and is headed to a vote before the full House.

Saying ‘No’ Sometimes

Two of the few places where lawmakers seem to be putting their legislative foot down is regarding the care home industry’s desire to delay posting inspection reports online and to change the minimum age and education requirements for primary and substitute caregivers in CCFFHs.

House Bill 1116, which would have changed the age and education requirements, died without a hearing this session.

Gov. David Ige’s administration on Thursday asked lawmakers to kill legislation that would have given the Health Department a six-month extension to start posting inspection reports for adult care homes on its website. Now, health officials say the office in charge of the bulk of those reports will start posting them by mid-March.

On the whole though, lawmakers this session seem keen on finding ways to help care home operators make more money at no cost to the state.

The House Human Services Committee, chaired by Rep. Dee Morikawa, killed House Bill 1115 last month. The legislation would have increased the state payments to ARCHs, CCFFHs and other types of facilities.

Currently, those payments are based on the federal poverty level established in 2006. The bill would have brought that level up to date and tied it to the consumer price index so it would automatically be adjusted each year.

The federal poverty level in 2014 was 19 percent higher than in 2006, a point the Department of Human Services highlighted in its testimony on the bill.

Lawmakers seem keen on finding ways to help care home operators make more money at no cost to the state.

The department underscored financial concerns over the cost of changing the amount of the payments.

The state has budgeted $17.8 million in 2015 for the supplemental payments it gives certain care homes. This equates to just under $1,400 per month for each care home resident who is Medicaid eligible.

That’s in addition to roughly $1,300 per month per eligible client the department pays for personal care services, bringing the total payment to about $2,700 per month per Medicaid resident.

The caregiver of the facility receives all of that money except $50, which goes to the Medicaid resident for personal expenses, according to the department’s testimony.

With 2,610 residents staying in these types of facilities in 2014, DHS estimates it would cost an extra $313,200 per year for a $10 monthly increase, $939,600 per year for a $30 monthly increase and almost $1.6 million per year for a $50 monthly increase.

Money for Medicaid Clients

Lawmakers similarly balked in this tight budget year when considering House Bill 863, which could have given more resources to people on Medicaid.

The bill would have appropriated several million dollars to establish health care homes for Medicaid enrollees at federally qualified community health centers as provided in the Patient Protection and Affordable Care Act.

The legislation noted that these centers saved more than $90 million for Hawaii’s Medicaid program in 2013 alone and that millions of dollars in matching federal funds are available.

The bill died without a hearing in the House Human Services and Health committees, chaired by Morikawa and Rep. Della Au Belatti, respectively.

However, House Bill 1161, which contains much of the same language, cleared the full House on Friday and now crosses over to the Senate for its consideration.

About the Author