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Virginia Health Care Association | Virginia Center for Assisted Living

Key Issues to Watch During Session

Key Issues to Watch During Session

general assemblyThe General Assembly convened in Richmond for its 2016 session on Wednesday, January 13. Legislators are scheduled to meet for 60 days this year and will develop the budget for the state fiscal years (FY) 2017 and 2018.

Heading into the session, VHCA-VCAL is well positioned. Significant outreach to legislators over the spring, summer and fall has helped to establish strong connections with key decision makers on our priority issues. We know that legislators will address certificate of public need (COPN), provider assessments, and Medicaid reimbursement issues in the budget.

Here is a summary of our position on and the current status of these and other issues:

  • COPN—Del. John O’Bannon (R-Henrico), Del. Kathy Byron (R-Campbell), Del. Chris Peace (R-Hanover), Del. Chris Stolle (R-Virginia Beach), Del. Chris Head (R-Roanoke), Del. Rob Bell (R-Albemarle), Del. Dickie Bell (R-Staunton), Sen. Bill Stanley (R-Franklin County), and Sen. Bill DeSteph (R-Virginia Beach) have introduced a series of bills to reform the COPN system in Virginia. Most introduced bills will include exemptions to maintain the COPN process for nursing centers. We are closely tracking all proposed changes to the COPN process. Staff and member leaders have met with over 25 legislative leaders and members of the House and Senate Committees (Health, Welfare and Institutions and Education and Health, respectively) with jurisdiction over COPN to discuss our continued support for the COPN program for nursing facilities. We expect legislators to introduce more COPN-targeted bills before the 2016 bill filing deadline, January 22.
  • Provider Assessments—This fall VHCA publicly noted members’ concerns with creating a provider assessment program for nursing facilities. While Gov. Terry McAuliffe’s budget proposal does include a provider assessment for hospitals, it does not affect nursing centers. We will continue to monitor this issue in the budget to make sure these assessments are not applied to nursing centers.
  • Medicaid Reimbursement and Rebasing—Nursing facilities are among only a small number of health care providers who have been given a scheduled inflation increase in their Medicaid rates in the proposed budget.  Nursing facilities are slated to see a 0.9 percent increase in rates for FY 2017. The proposed budget does not include inflation increases for any provider group in FY 2018. VHCA appreciates that Gov. McAuliffe’s proposal for 2017 reflects the increased costs of providing care to nursing center patients.  VHCA plans to actively lobby the General Assembly to maintain the 2017 funding increase and restore the inflation increase for nursing facilities for FY 2018.

    This year Medicaid rates for nursing facilities will be rebased. Rebasing is the process that occurs every three year by which Virginia recalibrates Medicaid rates using prior year’s inflation factors.   VHCA learned late this fall that the Department of Medical Assistance Services (DMAS) has made a policy change that, without correction, would have a negative impact on Medicaid nursing center reimbursement.

    As you’ll recall, the General Assembly deferred the FY 2016 inflation increase for nursing centers to help address a one-time state revenue shortfall. FY 2016 is now one of the years being used to calculate the rebasing. Instead of using the deferred 2016 inflation factor of 1.4% in its budget forecast, DMAS has used a zero in its place. By using a zero in its rebasing calculations, the impact of the 2016 inflation deferral would be compounded over the current rebasing cycle, which affects payment rates for 2018-2020. What was intended as a one year inflation deferral in 2016 could have a multi-year payment impact. We are actively working to address this issue with proposed budget amendments.
  • Proposed Closing of Catawba and Piedmont Geriatric Hospitals—Gov. McAuliffe’s budget proposes closing the 110-bed Catawba Hospital in Roanoke County and the Piedmont Geriatric Hospital in Nottoway County by the end of FY 2018. Both hospitals provide dedicated geriatric mental health care. To offset these closures, the governor has proposed adding beds to Western State Hospital in Staunton and increasing funding for community-based services.  We will be monitoring developments related to these facilities to assess the impact on member centers.      
  • Specialized Care Rate Revision—The governor’s budget includes language to transition specialized care rates from a retrospective, cost-settled approach to a fully prospective rate. Much like the recent shift to a prospective rate system for nursing facility services, specialized care rates would be established on a state fiscal year basis and would not be subject to settlement.  The budget proposes this change as budget neutral, with an effective date of July 1, 2016.  This proposal only affects a handful of VHCA members who offer specialized care services (primarily ventilator care).

Legislators have until January 22 to introduce legislation. VHCA-VCAL is reviewing all bills to assess whether they have an impact on nursing or assisted living centers. We will work to ensure legislation does not adversely affect the membership. We will provide weekly updates in CareConnection throughout session.