The Committee on Health and Human Services was called to order at 1:40 p.m. on Wednesday, March 3, 1999. Chairman Vivian Freeman presided in Room 3138 of the Legislative Building, Carson City, Nevada. Exhibit A is the Agenda. Exhibit B is the Guest List. All Exhibits are available and on file at the Research Library of the Legislative Counsel Bureau.

COMMITTEE MEMBERS PRESENT:

Mrs. Vivian Freeman, Chairman

Mrs. Ellen Koivisto, Vice Chairman

Ms. Sharron Angle

Ms. Merle Berman

Ms. Barbara Buckley

Ms. Dawn Gibbons

Ms. Sheila Leslie

Mr. Mark Manendo

Ms. Kathy McClain

Mr. Kelly Thomas

Ms. Kathy Von Tobel

Mr. Wendell Williams

STAFF MEMBERS PRESENT:

OTHERS PRESENT:

Richard J. Panelli, Chief, Bureau of Licensure and Certification, Nevada Department of Human Resources, Health Division

Dorothy North, Private citizen

Marilyn Morrical, Certified Drug and Alcohol Abuse Counselor

Laurence Matheis, Executive Director, Nevada State Medical Association

Janice Wright, Acting Administrator, Department of Human Resources, Division of Health Care Financing and Policy

Kari Demetras, Executive Director, Step 2

Theresa Lemus, Executive Director, Northern Area Substance Abuse Council

Paula Berkley, Lobbyist, Educare Community Living Corporation

James Richardson, Lobbyist, Nevada Faculty Alliance

Chris Ferrari, Legislative Liaison, Office of the Governor

Denise Everett, Advocate, Sagewind

Kevin Quint, Churchill Council – New Frontier

Winthrop Cashdollar, Lobbyist, Nevada Health Care Association

Bill Welch, Lobbyist, Nevada Association of Hospitals and Health System

Stacey Ziegler, Assistant Director, Great Basin Primary Care Association

Janine Hansen, President, New Eagle Forum

Bobbie Gang, Lobbyist, Nevada Women’s Lobby

Following roll call, Chairman Freeman announced the committee introduction of Bill Draft Request 38-519.

• BDR 38-519 - Revises provisions governing funding for institutional care of medically indigent persons under state plan for Medicaid. (A.B. 386)

Chairman Freeman explained the Nevada Association of Counties (NACO) (Exhibit C) submitted the BDR. Because the BDR would increase expenditures, it was to be a concurrent introduction from the Committee on Health and Human Services to Ways and Means.

ASSEMBLYWOMAN GIBBONS MOVED TO INTRODUCE B.D.R. 519.

MOTION SECONDED BY ASSEMBLYMAN MANENDO.

MOTION CARRIED UNANIMOUSLY.

Chairman Freeman then submitted for approval of the committee an amendment to A.C.R. 11.

Marla McDade Williams, Committee Policy Analyst, Legislative Counsel Bureau, explained after testimony on A.C.R. 11, proponents of the measure stated the belief the measure was made too broad in asking for a review of statutes regarding mental health and mental retardation. It was suggested the resolution be pared down to focus on adolescent suicide. The amendment submitted by Chairman Freeman (Exhibit D) contained language changes to indicate persons with mental illness and mental retardation.

Assemblywoman Leslie introduced A.B. 265, and explained the bill, requested by the Community Unity Coalition was co-sponsored by Senator Randolph Townsend. Accompanying Assemblywoman Leslie was Marilynn Morrical, former Director of the Bureau of Alcohol and Drug Abuse (BADA), who served as technical advisor to the bill. Also with Ms. Leslie was Theresa Lemus, Executive Director of the Northern Area Substance Abuse Council (NASAC). Ms. Leslie explained A.B. 265 was essentially a "good government" bill which provided a mechanism to avoid expensive duplication of effort between two agencies, both of which had a legal mandate to inspect the Bureau of Alcohol and Drug Abuse accredited programs. The bill also placed the oversight of those programs with the agency having expertise in the treatment of alcohol and drug abuse, the Bureau of Alcohol and Drug Abuse (BADA). BADA regularly updated its regulations, continued Ms. Leslie, most recently in 1984, 1987, 1992, 1994, and 1998. In contrast, the department that currently had responsibility for licensing such programs updated their regulations in December of 1998; however, those same regulations had been in place since 1969.

The bill would reduce also costs to providers since BADA already charged an accreditation fee. BADA might have to charge more due to taking on additional licensing regulations, but the providers would be paying only once for accreditation and licensing.

It was Assemblywoman Leslie’s understanding the health-licensing agency performed site visits when a program opened, when a change occurred to the facility, or when a complaint was made. BADA already performed such site visits to those programs every 1 to 2 years and monitored performance on an ongoing basis. A.B. 265 would insure programs be inspected with greater regularity.

Assemblywoman Leslie directed the committee’s attention to individual sections of A.B. 265:

• Section 1 of the bill, which was the health-licenser area of the Nevada Revised Statute 441. A.B. 265 would remove the definition of "facility for the treatment of abuse of alcohol or drugs", and eliminate the duplication in the law that both BADA and Health Licensing had oversight over indicated programs.
• Sections 2 and 3 would exempt residential alcohol and drug abuse programs from the definition of "residential facilities for groups" since there would be a different oversight mechanism for those programs. Section 2 also expanded the scope of licensing to all residential treatment facilities for alcohol and drug abuse, not just those programs which chose to be certified by BADA.
• Section 4 addressed Nevada Revised Statute 458, which dealt with the Bureau of Alcohol and Drug Abuse’s responsibilities.
• Sections 5 through 10 provided definitions of terms used throughout A.B. 265.
• Section 11 dealt with existing language that would be kept intact but would reference BADA.
• Sections 12 and 13 defined who must be licensed and required BADA to adopt licensing standards and other regulations. Section 13, subsection 2, included a provision that allowed BADA to charge a fee for licenses, thereby avoiding a fiscal note.
• Section 14 outlined the application process.
• Section 15 gave licensing renewal provisions.
• Section 16 exempted facilities run by churches with a spiritual focus to their programs.
• Sections 17 and 18 defined how licenses were issued and what was included on the license.
• Section 19 addressed cancellation of licenses.
• Section 20 directed where monies collected were placed. Ms. Leslie expressed her concern that BADA should receive those monies.
• Section 21 required inspection by the local fire marshal. Subsection (2) outlined the authority of BADA to investigate complaints.
• Section 22 described the process by which BADA could deny, suspend, or revoke a license.
• Section 23 outlined consequences to a facility which violated any provision related to licensure.
• Section 24 proposed criteria for imposing sanctions.
• Section 25 delineated requirements for notification of sanctions and explained the appeal process.
• Section 26 was a severe penalty clause.
• Section 27 explained BADA could regularly inspect facilities at its discretion.
• Section 28 stated the local district attorney could conduct prosecution for violations.
• Section 29 explained adoption of regulations and public hearings.
• Section 30 allowed BADA to provide its own staff or use outside contracts for services.
• Section 31 required each facility to provide financial statements and budgets to BADA.
• Section 32 explained transfer agreements with other facilities.
• Section 33 addressed confidentiality and put Nevada in compliance with federal law.
• Sections 34 through 37 discussed patient and client rights.
• Section 38 addressed two sections A.B. 265 repealed. The first repealed section was consistent with definitions changed in the beginning of the bill while the second repealed section acknowledged BADA had its own employee criminal history check process in place.
• Sections 39 through 41 contained existing language with no changes.

Assemblywoman Freeman commented as long as she had been with the Legislature, she had found that once monies went into the general fund, it was difficult to see them come out again. She suggested if section 20 was an important issue, Mrs. Leslie might consider having the money go back to the agency.

Marilynn Morrical, who served as volunteer technical advisor to Ms. Leslie, said she felt A.B. 265 effectively addressed duplication of effort issues and decreased costs to programs for the accreditation process, which put more money into drug treatment services.

Next to testify in support of A.B. 265 was Theresa Lemus, Executive Director of Northern Area Substance Abuse Council (NASAC). Ms. Lemus told the committee she was a registered nurse as well as a certified drug abuse counselor. Ms. Lemus stated NASAC was a private nonprofit substance abuse treatment facility for adults and had offered services to the northern Nevada community for over 20 years. Approximately 2 ½ years ago, NASAC received funding from BADA to implement a nationally recognized level of service by the American Society of Addictive Medicine. Ms. Lemus explained a modified medical detoxification service provided individuals a safe and medically supported recovery environment at a time during withdrawal when there was a potential for life-threatening complications. Statistics showed a simple regimen of medication and monitoring could greatly decrease the potential for such problems to occur.

Under A.B. 265 NASAC would offer very limited primary care to individuals in a non-acute health state in need of detoxification from alcohol and other drugs. As defined in the nationally recognized model, the physician defined and prescribed the treatment regimen and nurses followed a plan of care. There were two hallmarks to that model, explained Ms. Lemus. One was delivery of services would occur in a non-hospital setting, and the other was the coordination of a detox service with ongoing treatment modalities, meaning there would be some effort to encourage the individuals after detoxification to go into another level of treatment. In the model in question, the provider of services would also have contractual relationships with more intensive services such as area hospitals and emergency rooms in case of a medical emergency or need to transfer to a higher level of care. Ms. Lemus told the committee there were many benefits to providing care in a non-hospital setting, such as:

• A specialized form of care to individuals with addictions,
• The ability of the facility to accept any individual regardless of their financial status; and
• A decrease in the number of inappropriate admissions to local emergency rooms and hospitals.

Most importantly, said Ms. Lemus, in a detox program with other levels of care available there was an intensive case management to ongoing treatment instituted which alone had an impact on decreasing crime, homelessness, and premature deaths due to alcohol and drug abuse.

As Ms. Lemus had previously indicated, NASAC was funded by BADA to provide those services over 2 years ago. She explained the program was put on hold due to conflicting regulations between the Health Division, Bureau of Licensure and Certification (BLC), and BADA. In ongoing discussions with Richard Panelli, Chief, Bureau of Licensure and Certification (BLC), and the staff of BLC, it was indicated there was currently no licensing category for the form of service NASAC proposed and for which it was funded. Therefore, because NASAC was staffing its program with nurses on a 24-hour basis, they would need to acquire a license for a hospital. Ms. Lemus provided a handout (Exhibit E) stating some of the stipulations to which NASAC would have to adhere in order to become a hospital. For example, NASAC would need to provide space for a morgue to house dead bodies for pickup by the coroner, and another very expensive requirement, a nurse call system throughout the institution.

NASAC, explained Ms. Lemus, was located on state grounds and leased from the Nevada Mental Health Institute. The buildings were old with outdated construction standards. However, NASAC was able to remodel its building, primarily with volunteer effort, to suit their needs as a residential and detoxification facility. In order to comply with the Health Division in acquiring a hospital license NASAC would need in excess of $500,000.

Ms. Lemus reiterated the services so necessary to the community were not functioning due to unnecessary constrictions from outdated regulations written in 1969. It was her belief the Health Division did indeed play a vital role in the health and safety of the community; however, the current regulations did not allow for specialized services for the treatment of alcohol and drug abuse. BADA would be more appropriate and effective in regulating agencies for those needs.

Finally, included in Exhibit E was a timeline to explain NASAC efforts to work with the Health Division. Ms. Lemus concluded it was her opinion that a license for a hospital was not necessary for NASAC to provide services.

Kari Demetras, Executive Director, Step 2, testified that Step 2 was an agency in Reno which served pregnant and parenting women and their children. Step 2 provided long-term residential care in addition to outpatient and transitional housing and was regulated by the Health Division for the long-term treatment component of the program. The agency supported A.B. 265 because of the difficulty and high cost of complying with the Health Division regulations as currently written. It certainly understood the need for health and safety regulation in their agency, particularly because it served women and children. The issue with current regulations was they did not really fit the social model service of Step 2.

Ms. Demetras said Step 2 operated in a residential neighborhood, and one of the primary goals was to help low-income and often homeless women and families move toward self-sufficiency. The program was holistic in nature and helped with transportation, employment, and household skills. That presented a need to bring its kitchen facilities to commercial status which required expensive equipment and safety features such as gates to keep children out of the area. Ms. Demetras stated she was hired as Executive Director for Step 2 in October 1996 and the agency had applied for certification and licensure in June 1996. To date, Step 2 still did not have that certification. At the end of February 1999, Step 2 received the required commercial permit, but there were other steps to take. So far $60,000 had been spent to get compliance issues resolved, which represented almost all the agency’s operating budget. Those monies could be better used in direct services to clients. The $60,000 figure did not include volunteer and "in kind" support received by the agency, staff time involved, pro-bono work by the board, travel expenses, and so forth. The certification and licensing process had encumbered Step 2’s ability to expand its services. Presently, only 5 percent of publicly funded programs nationwide served pregnant, parenting women and their children. Nevada was fortunate to have two such programs, but there were still only 36 beds in the state. The waiting list was constantly equal to that figure. As a result of the regulations as currently written, it was prohibitive to expand the available number of beds. The Bureau of Family Health Services and the Paranatal Substance Abuse Subcommittee of the Maternal and Child Health Advisory Board staffed by the Health Division had asked whether only lack of money prohibited expansion of beds. Not only funds but the additional regulatory requirements involved in having more beds was hampering that expansion.

Chairman Freeman asked Ms. Demetras if Step 2 received third-party reimbursement from Medicaid or Medicare, to which Ms. Demetras responded such was not the case.

Next to testify in support of A.B. 265 was Denise Everett, Director, Sagewind. Ms. Everett explained Sagewind was a private, nonprofit substance abuse treatment center for adolescents and their families in Reno. It was Ms. Everett’s understanding the Bureau of Licensure and Certification had been working under regulations developed some years ago. She also understood BADA was created in 1977 and designed a regulatory authority over drug and alcohol treatment providers in the form of accreditation. There was, therefore, a licensing division and an accreditation division in two different departments that had overlapping and often inconsistent regulations, which made it difficult for providers to be in compliance with either agency. Ms. Everett believed it made sense to have one bureau regulate the programs. Since BADA had the most current regulations and the most knowledge of the drug and alcohol issues they should and could cover health and safety issues. It did not appear the Bureau of Licensure and Certification had enough staff or funding to keep up with inspections. BADA, however, performed rigorous 2-day inspections biannually and the accreditation personnel were knowledgeable, well educated and qualified to perform that function. The BADA staff could easily learn health and safety aspects for facilities to include in those inspections.

Sagewind had gone through a period of 5 to 6 years when there was no inspection by the Bureau of Licensure and Certification. Sagewind’s license had expired at the end of 1997, and an administrative decision was made to not be accredited or accept funding from BADA because of the difficulty of dealing with the Bureau of Licensure and Certification in matters of expansion or moving. Because of that Sagewind was not licensed by anyone. Ms. Everett realized that of primary importance was the health and safety of clients, but she also knew while she could vouch for her facility, she could not speak for any new facility that might be built. One thing the bill addressed was it was not necessary to be accredited by BADA, which created a big pocket missing regulatory emphasis.

Chairman Freeman then asked Ms. Leslie if she could respond to the testimony of Ms. Everett. Ms. Leslie told the committee the current system was not working to protect clients in alcohol and drug abuse programs because the regulations under the Health Licensing Bureau did not match those of substance abuse agencies. A lot of things had changed from 1969 to date, and a concern was programs were not being licensed. It was her belief the licensing agency should be the Bureau of Alcohol and Drug Abuse.

Mrs. Freeman questioned, assuming A.B. 265 passed, the timeline for licensing. Ms. Leslie replied Robert Johnston of the Bureau of Alcohol and Drug Abuse, who would testify shortly, might better answer the question.

Assemblywoman Von Tobel queried the necessity of a two-thirds majority floor vote to pass the bill. Ms. Leslie explained perhaps the reason was A.B. 265 stated the Bureau of Alcohol and Drug Abuse might charge a fee for licensing.

Richard Panelli, Chief of the Bureau of Licensure and Certification, State Health Division, Department of Human Resources, testified next on A.B. 265. Mr. Panelli presented a handout (Exhibit F) to the committee which explained the Bureau of Licensure and Certification currently licensed 14 residential facilities for the treatment of alcohol and drug abuse. Those facilities had a total of 338 beds. Current revenue realized by the Bureau of Licensure and Certification was approximately $16,000 per year, and annual revenue fee per facility was $300 plus $35 per bed for renewal. A new facility would pay $500 annually, plus $50 per bed for renewal, which would increase revenues by $3,300.

Mr. Panelli commented A.B. 265 would not change the situation for NASAC. Because they would provide modified medical detox, NASAC would be concurrently by statute a medical facility. It could be necessary to include a definition specific to NASAC to eliminate them from being considered a "medical facility" under the current statute of N.R.S. 449.

Robert Johnston, Acting Chief of the Bureau of Alcohol and Drug Abuse, addressed the question of transition time to put into place the measures discussed in A.B. 265. One requirement would be for the Bureau of Alcohol and Drug Abuse to work with the Bureau of Licensure and Certification to study applicable regulations and to develop licensure regulations for facilities. Those were not currently in process since the Bureau of Alcohol and Drug Abuse had been focussed on residential facilities clinical areas. The Bureau of Alcohol and Drug Abuse had deferred to the Bureau of Licensure and Certification for health and safety issues.

Next to testify in support of A.B. 265 was Dorothy North, Administrator, Vitality Center Elko, Nevada. Ms. Norris informed the committee two of the facilities she oversaw were residential facilities licensed by the Health Division. Currently regulations under which her facilities were licensed were not relevant to that particular type of facility. There was no question as to the validity of regulations to insure the health and safety of patients; however, the agency that developed the regulations should be the same agency that accredited the facility. There appeared to be a substantial duplication of effort due to overlapping regulations. Ms. North expressed the conviction that the Bureau of Alcohol and Drug Abuse would develop regulations for licensure of residential programs that would be more representative of what alcohol and drug programs actually did. She urged support of A.B. 265.

Kevin Quint, Executive Director, Churchill Council New Frontier, Fallon, Nevada, testified next. Mr. Quint gave the committee his testimony (Exhibit G) and explained the Churchill Council New Frontier operated several substance abuse programs, including a 20-bed facility. From the provider’s perspective, A.B. 265 was a good idea. The Bureau of Alcohol and Drug Abuse not only funded programs, they also regulated programs. The Division of Health Review was similar but encompassed much less detail. While that division was expert in health and safety issues, the people with whom Mr. Quint interacted did not appear to be expert in drug and alcohol issues.

Except for approval of a building expansion in 1997, Mr. Quint had not seen a health inspector since 1993. He was curious as to why his organization spent over $1,000 a year to relicense their programs and received nothing more than a piece of paper. If it were not necessary to expend those funds, they would be better used elsewhere in the programs. Mr. Quint asked the committee to support A.B. 265.

Kari Demetras added section 2(1)(b) contained unclear language. In regard to the phrase "four or more females during pregnancy or after delivery," she was not sure what would apply to Step 2, and requested clarification.

Ms. Leslie explained A.B. 265 did not propose to change the health division regulations. Ms. Demetras requested further information. Ms. Leslie said she would look into that question.

Assemblywoman Gibbons commented the language concerning Ms. Demetras was already existing law. Ms. Demetras agreed that was the case, but the confusion was where her facility fit in if the proposed language was to move alcohol and drug treatment facilities under the health and safety regulation conducted by the Bureau of Alcohol and Drug Abuse. She reiterated her facility also fit under the "pregnant and after delivery" language.

Chairman Freeman asked Ms. Leslie if there were amendments to the bill. Ms. Leslie said the amendment was to allow the Bureau of Alcohol and Drug Abuse to retain licensing fees rather then submit them to the State General Funds.

ASSEMBLYWOMAN LESLIE MOVED TO AMEND AND DO PASS.

MOTION SECONDED BY ASSEMBLYWOMAN GIBBONS.

MOTION PASSED UNANIMOUSLY.

Chairman Freeman opened discussion on A.C.R. 6.

Janice Wright, Acting Administrator, Department of Human Resources, Division of Health Care Financing and Policy, addressed the issue of A.C.R. 6. She stated (see Exhibit H) under Title 1 of the Social Security Act, outreach activities to enroll children in the Nevada Checkup Program or other public or private coverage came out of the state’s 10-percent administrative cap. The expenditures were limited, so it was necessary to ensure adequate medical services for such children. President Clinton’s budget had a proposal to remove the outreach activities from the 10-percent cap which would allow agencies such as Department of Human Resources to spend an additional amount. The current outreach efforts of the Nevada Checkup Program were through sources which included eligibility training with community-based organizations, traditional community providers, and sister agencies. To date, continued Ms. Wright, over 500,000 applications had been distributed statewide. Community-based organizations and traditional community providers included:

• Head Start
• All 17 school districts
• Boys and Girls Clubs
• Religious organizations
• Hospitals and health care providers
• Indian health services
• Child care centers
• Employers
• Federally qualified health centers
• University of Nevada School of Medicine
• Rural health clinics
• Hispanic advocacy groups
• Children’s Cabinet and other groups.

The sister agencies included in the outreach efforts involved the:

• Welfare Division,

• Women, Infants and Children USDA Special Supplemental Food Program (WIC)
• children with special health care needs,
• Division for Child and Family Services,
• Bureau of Disability Adjudication,
• Bureau of Alcohol and Drug Abuse,
• Baby-Your-Baby,
• Employment Security,
• Mental Health and Mental Retardation; and
• Low-income Home Energy Assistance Program.

In an attempt to broaden the appeal of outreach efforts and to seek input from community providers an advisory team was being formed among the private and public sector. Of the 10,326 children who had applied for the program, 43 percent heard of the program through the school districts as a direct result of 40,000 applications sent to the school districts throughout Nevada. Eleven percent heard of the program through the media and another 11 percent learned of the program through friends or people currently enrolled. The remaining percentages were from various social service agencies.

As an adjunct to current activities, Ms. Wright continued, Nevada Checkup Program was working with the National Governor’s Association to tap into their campaign entitled "Insure Kids Now." On February 23, 1999, President and Mrs. Clinton announced the program, which could direct families to individual state programs. Nevada had a bilingual 24-hour hotline, and the first day 83 calls were received from that referral.

Further, the Department of Human Resources had been working with Great Basin Primary Care in developing their statewide "Covering Kids Coalition" Robert Wood Johnson grant application. The coalition had originally requested $1 million over a 3-year period but had revised that request downward to $850,000. Should the association’s application be approved, the money would be used to do statewide marketing and outreach at the grassroots level. That would span a three-year period to ensure that Nevada children were enrolled in either Medicaid or the Nevada Checkup Program. To date, approximately 20 states had been awarded a "Covering Kids" grant.

Assemblywoman Freeman requested a copy of percentages and other figures as testified and Ms. Wright stated she would provide that information. Assemblywoman Buckley asked how many children were enrolled at the present in Nevada Checkup. Ms. Wright responded there were 4,500 enrolled of which 4,100 were currently receiving services, and the balance would begin receiving services the beginning of the following month. Children were enrolled for the prospective month following application.

Chairman Freeman closed the hearing on A.C.R. 6 and opened discussion on A.C.R. 10.

Winthrop Cashdollar, Executive Director, Nevada Health Care Association (NHCA), spoke in support of A.C.R. 10. Mr. Cashdollar explained NHCA was an association of subacute, nursing facility, and assisted living long-term care providers throughout Nevada (Exhibit I).

Mr. Cashdollar told the committee NHCA hoped through A.C.R. 10, Nevada could become a national leader in promoting quality in long term care facilities by demonstrating an alternative to the current survey system.

Every few years, continued Mr. Cashdollar, the nation was treated to horror stories about the truly terrible treatment of some frail elderly residents of nursing facilities. Some 15 months ago, a national news weekly magazine brought to light shocking stories of mistreatment in nursing facilities in California, Texas, and Michigan. Those revelations, which dealt with only a handful of nursing facilities, were seen as tarring the whole nursing facilities industry. A General Accounting Office study, United States Senate hearings, and President Clinton’s Nursing Facility Initiative followed up the stories. Among other things, the President’s initiative brought closer scrutiny and much more widespread punishment of infractions in nursing facilities.

Mr. Cashdollar suggested if the current approach to nursing facilities surveys had not yielded the quality the nation expected, another approach might be warranted. A.C.R. 10 envisioned a continuous quality improvement which took advantage of a new requirement for nursing facilities to computerize a great deal of information about every resident and electronically transmit that information to state survey agencies.

The proposal would allow continuous monitoring of nursing facilities. Currently, nursing facilities were inspected or surveyed more or less yearly, although the time varied by 3 months either way. A.C.R. 10 would allow the state survey agency access to information on a continuous basis of factors that mattered to the quality of care and well-being of residents. The survey agencies could focus their attentions on facilities that needed frequent inspection. Continuous quality improvement spoke to establishing goals on such matters as frequency of falls in nursing facilities, skin integrity of patients, and the residents or their families reports of satisfaction with key aspects of care received. It would also allow facilities to compare their changing standards, as well as standards of other facilities. Software that would allow the comparison was already available.

Next to testify on A.C.R. 10 was Richard Panelli, Chief, Bureau of Licensure and Certification, State of Nevada Health Division. Mr. Panelli submitted a copy of his testimony to the committee (Exhibit J).

As he began to speak, Mr. Panelli stressed that 100 percent of the facilities in Nevada were inspected on an annual basis. Much of the Bureau’s attention was focused on that procedure. He then informed the committee the Bureau of Licensure and Certification supported the concept embodied in A.C.R. 10.

Currently, the Bureau of Licensure and Certification survey process was a federally mandated process directed by the Health Care Financing Administration (HCFA). The current survey was controlled by HCFA and could not be changed if skilled nursing facilities were to be certified to receive Medicare/Medicaid reimbursement. The current federal process was used throughout the United States by all state agencies which certified skilled nursing facilities for Medicare/Medicaid. The process looked specifically at the quality of care and quality of life of the residents. Experts in the field of geriatric care had updated the process as current standards in the industry changed. Nevada regulations were current as of December 10, 1998. HCFA was currently in the process of changing the standards for weight loss and unnecessary drugs because of identified problems of malnutrition and overuse of drugs in the nursing facility population.

Mr. Panelli continued the Bureau of Licensure and Certification did not collect or have available the information as requested in the resolution separately from the federal data collection system currently in place, known as the Medical Data System (MDS). The state did not have access to that information, and in order to get even a small piece of that information for an oral assessment study, the Bureau of Licensure and Certification had to go the Secretary to Health and Human Services in Baltimore, Maryland. That request took several months to approve and then only a small portion of that protected information was approved for disclosure. A new continuous quality improvement survey as described in A.C.R. 10 needed to be developed and implemented by the Bureau of Licensure and Certification, but the same federally mandated process would have to continue simultaneously. The quality improvement process would duplicate the federally mandated process and would cause a significant fiscal impact to the Bureau of Licensure and Certification, which was totally fee-funded.

Chairman Freeman commented the Bureau of Licensure and Certification being fee-funded had always been a concern to her. She noted federal law required an annual survey, but she had heard about problems with nursing homes from the state for years. She had seen in the paper a nursing home in Fallon was being fined. She asked for comment on that issue.

Mr. Panelli agreed there was a nursing home in Fallon with significant problems. They had received some quite extensive civil monetary penalties but that facility had changed; they had one of the first deficiency-free surveys conducted by the Bureau of Licensure and Certification in years and had reason to be proud. A corporation that purchased 10 or 11 facilities statewide had recently bought them out.

Mrs. Freeman asked how the Bureau of Licensure and Certification was doing with the funds they received from fees. She wondered if there was a need to supplement their budget. She had wanted a state ombudsman in the picture for years but kept hearing there was no money in the budget. Mr. Panelli answered there were state ombudsmen in the Division of Aging; however, current licensing fees did not support that agency. Licensure fees were sufficient to support staff that did long-term care survey and certification. Any increases in those fees would be necessary for the next 2 years and would address only the cost of living increases. Fees ran approximately $1,000 annually plus $35 per bed for long-term care facilities.

Assemblyman Manendo asked if the facilities were notified in advance of annual inspections. Mr. Panelli advised the facilities were not told of upcoming inspections. In fact, the Health Care Finance Administration would levy through Social Security a $2,000 fine against anyone who was found divulging information. The facilities knew approximately when the inspections would take place because the Bureau of Licensure and Certification was mandated to inspect between 9 and 15 months with a 12-month average.

Mr. Manendo suggested perhaps that timeline should be changed. He was concerned with the same newspaper article Mrs. Freemen mentioned. He asked how circumstances had deteriorated to the point of such a large fine as $250,000 was levied. Perhaps two inspections a year and change in strategies were warranted so people were caught off-guard. He believed advance warning let the facility spruce up and then return to being a pigpen. He expressed he was sickened by that.

Mr. Cashdollar responded while he understood the story of the conditions and the fines was horrendous he felt the real story was following the fine, the facility had the best inspection in about 10 years. The new owners and staff took that facility with all its problems to ostensibly one of the best in the state. He assured Mr. Manendo any facility he would like to inspect would not be in that condition.

Some of the element of surprise, continued Mr. Cashdollar, was removed by the schedule. One of the reasons the alternative approach suggested by A.C.R. 10 was suggested was it would allow a continuous stream of information on dimensions that mattered to the well being of residents. The Bureau of Licensure and Certification could monitor the incoming electronic transmissions of information and if something looked wrong, could immediately investigate. Mr. Panelli added in response to Mr. Manendo’s suggestion of more frequent inspections, there were facilities selected for focus surveys at least twice a year, based on their past histories.

Mr. Manendo suggested perhaps the Health and Human Services Committee needed to make surprise inspections. While serving on the Assembly Committee on Judiciary, he had experienced a great difference between what was seen on a regular inspection of the prison in Carson City and what he saw when he went back himself.

Mrs. Freeman agreed the entire committee felt responsible for the elderly, and if there was anything the committee could do to help, they would be happy to oblige. She invited both Mr. Cashdollar and Mr. Panelli to appear again before the end of session for an update of the situation. Mr. Panelli accepted the invitation.

ASSEMBLYWOMAN KOIVISTO MOVED TO DO PASS.

MOTION SECONDED BY ASSEMBLYWOMAN MCCLAIN.

MOTION CARRIED UNANIMOUSLY.

Chairman Freeman closed the hearing on A.C.R.10 and opened discussion on A.J.R. 9.

First to testify in support of A.J.R. 9 was Larry Matheis, Nevada State Medical Association, Policy Committee Chairman Nevada Tobacco Prevention Coalition. Mr. Matheis said Nevada and 45 other states along with the District of Columbia decided, after years of looking at the social and financial consequences of tobacco use on public programs, to seek from the tobacco industry some recovery of costs the public had to bear. The pressure of that litigation led to the national tobacco settlement. The Federal Government decided not to litigate at the time. The Nevada State Medical Association had encouraged the State of Nevada to litigate for Medicaid and related costs for several years before it was done. They also encouraged the Federal Government to litigate to recover costs to the federal taxpayer. What he did not encourage the federal government to do was to pick the pockets of the states that actually went forward, took the risks involved, and challenged the well-organized, well-financed onslaught from the tobacco industry. While the Federal Government had a legitimate claim for Medicaid costs, it should sue and prevail. It should not use its power to get money the states fought so hard to receive. Congress was urged to take action to prohibit the Federal Government from doing so. The Federal Government, said Mr. Matheis, should reassess why it had not litigated, and should go forward with that litigation.

Assemblywoman Leslie told Mr. Matheis she had read somewhere that President Clinton had said he would leave the tobacco money alone if the states would agree to certain things. She asked if he had any knowledge of those stipulations. Mr. Matheis responded there had been discussions which indicated that if the states chose to use the money in certain ways which seemed outside the reason the litigation went forward, the Federal Government then might want some of it. He did not think it was said the Federal Government would not touch the money, he thought the intent of the comment was to lay a case for why they would be entitled to it.

Anne Cathcart, Nevada Attorney General’s Office, said she spoke with the attorney general, who had some comments which addressed the question. One was that the specific issue of federal recoupment was being closely monitored on a daily basis. The attorney general had periodic telephone conversations with the National Association of Attorneys General and members of the negotiating team, and some of the discussion was related to litigation potential involving tobacco funds. Much of what Mr. Matheis said was on point. There were different movements in Washington with respect to the tobacco settlement funds. The attorney general had advised anyone who would listen that it would be extremely premature to expend or appropriate any tobacco settlement funds until all federal challenges were met. It was not necessarily just the issue of whether the Federal Government would file suit to allegedly recoup Medicaid expenditures, there were other issues to be addressed. The latest understanding from members of the congressional delegation was there was likely to be appointed a congressional task force to reach a resolution of the issue.

The final speaker on A.J.R. 9 was Chris Ferrari, Legislative Liaison, Office of the Governor. Mr. Ferrari (Exhibit K) told the committee he thought it was important Nevada show a united front to the Federal Government regarding the tobacco settlement money. It was also essential that state and federal representatives worked toward a common goal. Regardless of differences in the suggested use of the tobacco settlement monies, all agreed the Federal Government should not prohibit Nevada from receiving the money without federal intervention.

Mr. Ferrari further stated the governor’s office agreed the money should go to Nevada citizens for use in the area of health and welfare, and wanted to make it clear they believed health and welfare included education.

ASSEMBLYWOMAN VON TOBEL MOVED TO DO PASS ASSEMBLY JOINT RESOLUTION 9.

MOTION SECONDED BY ASSEMBLYWOMAN ANGLE.

MOTION CARRIED UNANIMOUSLY.

There being no further business before the committee, Chairman Freeman adjourned at 3:00 p.m.

RESPECTFULLY SUBMITTED:

Lois McDonald,

Committee Secretary

APPROVED BY:

Assemblywoman Vivian Freeman, Chairman

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