AB302: Bill Text

LRB-1332/3

TJD:cjs&wlj:ph

2011 - 2012 LEGISLATURE

2011 Assembly BILL 302

October 5, 2011 - Introduced by Representatives Knodl, Wynn, Nygren, Ballweg, Bernier, Bewley, Brooks, Danou, Doyle, Kestell, T. Larson, LeMahieu, Molepske Jr, Mursau, A. Ott, Petryk, Ripp, Spanbauer, Strachota, Thiesfeldt, Tranel, Van Roy, Williams and Vos, cosponsored by Senators Galloway, Lazich, Holperin, Schultz, Shilling, Vinehout and Wirch. Referred to Committee on Aging and Long-Term Care.

AB302,1,8 An Act to repeal 50.04 (5) (a) 5m.; to amend 20.435 (6) (g), 50.03 (4) (a) 1. a., 50.03 (4m) (a), 50.03 (5) (a), 50.03 (5) (b), 50.03 (7) (a), 50.03 (13) (a), 50.04 (4) (a) 1., 50.04 (4) (a) 2. b., 50.04 (4) (c) 1., 50.04 (4) (d) 2., 50.04 (4) (e) 1., 50.04 (5) (c), 50.04 (5) (e), 50.04 (5) (f), 50.04 (5) (fm), 50.05 (2) (f) (intro.) and 50.05 (2) (f) 2.; to repeal and recreate 50.04 (4) (d) 1. a., 50.04 (4) (d) 1. b. and 50.04 (6) (a); and to create 50.01 (1ng), 50.04 (4) (am) and 50.04 (8) of the statutes; relating to: regulation of nursing homes, requiring the exercise of rule-making authority, and making an appropriation.

Analysis by the Legislative Reference Bureau

Federal and state requirements for nursing homes

Under current law, a nursing home that receives Medicaid or Medicare funding for the care of a resident is subject to both federal and state requirements. The Department of Health Services (DHS) enforces both federal and state requirements for nursing homes. Currently, for nursing homes that are Medicaid and Medicare providers, DHS may issue both federal and state citations for the same practice and may recommend federal remedies and impose state sanctions. This bill prohibits DHS from issuing a notice of violation of a state requirement to a nursing home that is a Medical Assistance or Medicare provider if DHS has, in a statement of deficiency, cited the nursing home for a violation of a federal requirement that is based on the same facts.

Under current law, DHS may seek an injunction in court to enjoin the repeated violation of the state's nursing home statutes or a rule promulgated under the authority of the state's nursing home statutes. The bill allows DHS to seek an injunction to enjoin repeated violation of certain federal requirements related to the operation of a nursing home.

Monetary penalties

Under current law, DHS may assess a forfeiture against a nursing home for a violation of a state requirement. There is no time limit for DHS to assess a forfeiture for a violation. Nursing homes must pay forfeitures to DHS within ten days after receipt of notice of imposition of the forfeiture or after receipt of the final decision after exhaustion of administrative review. If a nursing home does not contest a notice of violation and a forfeiture and pays the forfeiture within ten days after receipt of the notice, DHS must reduce the forfeiture amount by 35 percent.

The bill requires DHS to impose a forfeiture within 120 days of notifying a nursing home of a violation or DHS loses the authority to impose a forfeiture. The bill changes to 60 days the time period by which a nursing home must pay forfeitures to DHS after receipt of the notice of imposition or the final decision after exhaustion of administrative review, and also changes to 60 days the time period within which a nursing home may pay a forfeiture and have the forfeiture amounts reduced by 35 percent.

Appeals

Currently, in order to appeal a DHS finding that the nursing home violated a state requirement, a nursing home must request a hearing on the finding within ten days of receiving notice of the violation. If DHS assesses a forfeiture for the violation and the nursing home wishes to appeal the forfeiture, the nursing home must request a separate hearing on the forfeiture within ten days of receiving notice of a contested action. Upon request of the nursing home, the hearing on the finding of violation may be stayed until DHS assesses a forfeiture so that the hearing on the finding of violation and the hearing on the forfeiture may be consolidated.

The bill extends the deadline for a nursing home to request a hearing on a finding that the nursing home violated a state requirement to 60 days after receipt of the notice of violation. The bill also extends the deadline for requesting a hearing on a forfeiture to 60 days after receipt of notice of the forfeiture. The bill further provides that, if a nursing home timely appeals both a finding of violation and a forfeiture, the hearings on the violation and the forfeiture will be consolidated.

Conditional and probationary licenses

Currently, in addition to the right to impose a forfeiture on a nursing home for violations, DHS may issue a conditional license to a nursing home in which DHS finds that a class "A" or a class "B" violation continues to exist. (A class "A" violation creates a condition or occurrence relating to the operation and maintenance of a nursing home that presents a substantial probability that death or serious mental or physical harm to a nursing home resident will result. A class "B" violation creates a condition or occurrence relating to the operation and maintenance of a nursing home that directly threatens the health, safety, or welfare of a nursing home resident.) Issuing a conditional license revokes any outstanding license held by the nursing home.

This bill expands the standard for issuance by DHS of a conditional license for a nursing home to also include a continuing violation of federal law that constitutes immediate jeopardy or actual harm not involving immediate jeopardy to a nursing home resident.

Under current law, an applicant for a nursing home license that has not been previously licensed to operate a nursing home or whose nursing home is not operating at the time of application is issued a probationary license. To obtain a regular license, DHS inspects the nursing home to determine whether the nursing home meets the requirements for licensure. The bill specifies that a nursing home operating under a probationary license must also substantially comply with requirements under certain federal regulations related to the operation of a nursing home, if applicable, in order to obtain a regular license.

Suspension of admissions

Under current law, DHS must suspend new admissions to a nursing home if the nursing home received notices of a class "A" violation or three or more class "B" violations in the previous 12 months; and if the nursing home received notices of a class "A" violation or three or more class "B" violations in any 12-month period during the three years immediately preceding the previous 12 months. Suspension of admissions begins 90 days after a nursing home receives its last notice of a class "A" or class "B" violation if DHS determines that the violation is uncorrected 90 days after the last notice or on the day that DHS makes a return visit to the nursing home and determines that the violation has not been corrected. A suspension must remain in effect until DHS determines that the nursing home has corrected all class "A" and class "B" violations.

This bill expands the standard for suspension of new admissions to a nursing home to include circumstances under which a nursing home received written notice of a violation that involved immediate jeopardy to a resident; a class "A" violation; or three or more class "B" violations or violations that constituted actual harm not involving immediate jeopardy to a resident. These circumstances must have occurred both in the previous 15 months and in any 15-month period during the 36 months immediately preceding the previous 15 months. Under the bill, a suspension of admissions may begin only 90 days after a nursing home receives its last notice of a violation if DHS determines that the violation in uncorrected 90 days after the last notice. Suspension of admissions must remain in effect until DHS determines that the nursing home has corrected the violation in question.

Suspension or revocation of licensure

Currently, DHS may, after providing notice to a nursing home applicant or licensee, suspend or revoke the license if DHS finds that the nursing home substantially failed to comply with applicable state statutes or rules. No state or federal funds passing through the state treasury may be paid to a nursing home that does not have a valid license. This bill also permits DHS to suspend or revoke a nursing home license if the nursing home has substantially failed to comply with specified state law or with federal requirements related to the operation of a nursing home.

Notices of violation

In certain circumstances under current law, DHS must provide a notice of violation to a nursing home, such as the presence in a nursing home of a class "A" or "B" violation. The department currently is not required to serve a notice of violation if the nursing home reports the violation to DHS and the violation occurs and remains uncorrected despite the nursing home's every reasonable effort to prevent and correct the violation. This bill expands the circumstances under which DHS is not required to serve a notice of violation to include situations in which a nursing home reports the violation to DHS and has corrected the violation.

Quality improvements

This bill allows DHS to distribute moneys, including civil money penalties collected under a certain federal regulation, for innovative projects designed to protect the property and the health, safety, and welfare of nursing home residents and to improve the efficiency and cost effectiveness of the operation of nursing home facilities. Also, under the bill, DHS must establish and maintain a quality assurance and improvement committee to review proposals and award moneys for those innovative projects.

For further information see the state and local fiscal estimate, which will be printed as an appendix to this bill.

The people of the state of Wisconsin, represented in senate and assembly, do enact as follows:

AB302, s. 1 Section 1. 20.435 (6) (g) of the statutes is amended to read:

AB302,4,8 20.435 (6) (g) Nursing facility resident protection. All moneys received from the penalty assessment surcharges on forfeitures that are levied by the department under s. 49.498 (16) (c) 1., 2. and 3. and the interest under s. 49.498 (16) (d) and from civil money penalties collected under 42 CFR 488.442 to finance nursing facility resident protection under s. 49.499 and any projects under s. 50.04 (8) to protect the property and the health, safety, and welfare of nursing home residents and to improve the efficiency and cost effectiveness of the operation of nursing homes.

AB302, s. 2 Section 2. 50.01 (1ng) of the statutes is created to read:

AB302,5,4 50.01 (1ng) "Immediate jeopardy" means a situation in which a nursing home's noncompliance with one or more requirements under 42 CFR 483 related to the operation of a nursing home has caused, or is likely to cause, serious injury, harm, impairment, or death to a resident.

AB302, s. 3 Section 3. 50.03 (4) (a) 1. a. of the statutes is amended to read:

AB302,5,13 50.03 (4) (a) 1. a. Except as provided in sub. (4m) (a), the department shall issue a license for a nursing home if it finds the applicant to be fit and qualified and if it finds that the nursing home meets the requirements established by this subchapter and, as applicable, requirements under 42 CFR 483 related to the operation of a nursing home. The department, or its designee, shall make such inspections and investigations as are necessary to determine the conditions existing in each case and shall file written reports. The department shall promulgate rules defining "fit and qualified" for the purposes of this subd. 1. a.

AB302, s. 4 Section 4. 50.03 (4m) (a) of the statutes is amended to read:

AB302,6,2 50.03 (4m) (a) If the applicant for licensure as a nursing home has not been previously licensed under this subchapter or if the nursing home is not in operation at the time application is made, the department shall issue a probationary license. A probationary license shall be valid for 12 months from the date of issuance unless sooner suspended or revoked under sub. (5). Prior to the expiration of a probationary license, the department shall inspect the nursing home and, if the nursing home meets the applicable requirements for licensure and, if applicable, substantially complies with requirements under 42 CFR 483 related to the operation of a nursing home, shall issue a regular license under sub. (4) (a) 1. a. If the department finds that the nursing home does not meet the requirements for licensure or does not substantially comply with requirements under 42 CFR 483 related to the operation of a nursing home, the department may not issue a regular license under sub. (4) (a) 1. a.

AB302, s. 5 Section 5. 50.03 (5) (a) of the statutes is amended to read:

AB302,6,11 50.03 (5) (a) Power of department. The department, after notice to a nursing home applicant or licensee, may suspend or revoke a license in any case in which the department finds that the nursing home has substantially failed to comply with the applicable requirements of this subchapter and the rules promulgated under this subchapter, with s. 49.498, or with requirements under 42 CFR 483 related to the operation of a nursing home. No state or federal funds passing through the state treasury may be paid to a nursing home that does not have a valid license issued under this section.

AB302, s. 6 Section 6. 50.03 (5) (b) of the statutes is amended to read:

AB302,6,16 50.03 (5) (b) Form of notice. Notice under this subsection shall include a clear and concise statement of the violations on which the revocation is based, the statute or, rule, or federal requirement violated and notice of the opportunity for an evidentiary hearing under par. (c).

AB302, s. 7 Section 7. 50.03 (7) (a) of the statutes is amended to read:

AB302,6,25 50.03 (7) (a) Licensed facility. Notwithstanding the existence or pursuit of any other remedy, the department may, upon the advice of the attorney general, maintain an action in the name of the state in the circuit court for injunction or other process against any licensee, owner, operator, administrator or representative of any owner of a facility to restrain and enjoin the repeated violation of any of the provisions of this subchapter or, rules promulgated by the department under this subchapter, or requirements under 42 CFR 483 related to the operation of a nursing home where the violation affects the health, safety or welfare of the residents.

AB302, s. 8 Section 8. 50.03 (13) (a) of the statutes is amended to read:

AB302,7,15 50.03 (13) (a) New license. Whenever ownership of a facility is transferred from the person or persons named in the license to any other person or persons, the transferee must obtain a new license. The license may be a probationary license. Penalties under sub. (1) shall apply to violations of this subsection. The transferee shall notify the department of the transfer, file an application under sub. (3) (b), and apply for a new license at least 30 days prior to final transfer. Retention of any interest required to be disclosed under sub. (3) (b) after transfer by any person who held such an interest prior to transfer may constitute grounds for denial of a license where violations of this subchapter, or of requirements of 42 CFR 483 related to the operation of a nursing home, for which notice had been given to the transferor are outstanding and uncorrected, if the department determines that effective control over operation of the facility has not been transferred. If the transferor was a provider under s. 49.43 (10), the transferee and transferor shall comply with s. 49.45 (21).

AB302, s. 9 Section 9. 50.04 (4) (a) 1. of the statutes is amended to read:

AB302,7,25 50.04 (4) (a) 1. If Except as provided in par. (am) 2., if upon inspection or investigation the department determines that a nursing home is in violation of this subchapter or the rules promulgated under it and the violation is a class "A" or "B" violation, it shall promptly serve a notice of violation upon the licensee. Each notice of violation shall be prepared in writing and shall specify the nature of the violation, and the statutory provision or rule alleged to have been violated. The notice shall inform the licensee of the right to a hearing under par. (e). The written notice of a class "A" violation may be written and served by an agent of the department at the time of the inspection.

AB302, s. 10 Section 10. 50.04 (4) (a) 2. b. of the statutes is amended to read:

AB302,8,5 50.04 (4) (a) 2. b. The nursing home has made every reasonable effort to prevent and correct the violation, but the violation occurred and remains uncorrected due to circumstances beyond the nursing home's control, or the nursing home has corrected the violation.

AB302, s. 11 Section 11. 50.04 (4) (am) of the statutes is created to read:

AB302,8,9 50.04 (4) (am) Dual federal and state violations. 1. Notwithstanding s. 50.01 (3), in this paragraph, "nursing home" does not include a facility serving people with developmental disabilities.

AB302,8,16 2. If an act or omission constitutes a violation of this subchapter or the rules promulgated under this subchapter, s. 49.498, or requirements under 42 CFR 483 related to the operation of a nursing home, the department may not issue under s. 50.04 (4) (a) a notice of violation of this subchapter, the rules promulgated under this subchapter, or s. 49.498 if the department has, in a statement of deficiency, cited the nursing home for the violation under requirements under 42 CFR 483 related to the operation of a nursing home.

AB302, s. 12 Section 12. 50.04 (4) (c) 1. of the statutes is amended to read:

AB302,8,25 50.04 (4) (c) 1. The situation, condition or practice constituting a class "A" violation or immediate jeopardy shall be abated or eliminated immediately unless a fixed period of time, as determined by the department and specified in the notice of violation, is required for correction. If the class "A" violation or immediate jeopardy is not abated or eliminated within the specified time period, the department shall maintain an action in circuit court for injunction or other process against the licensee, owner, operator, administrator or representative of the facility to restrain and enjoin violation of applicable rules, regulations and statutes.

AB302, s. 13 Section 13. 50.04 (4) (d) 1. a. of the statutes is repealed and recreated to read:

AB302,9,6 50.04 (4) (d) 1. a. In the previous 15 months, the nursing home received written notice of a violation of a state statute or rule or a federal statute or regulation that involved immediate jeopardy to a resident; a class "A" violation; or 3 or more class "B" violations or violations that constituted actual harm not involving immediate jeopardy to a resident.

AB302, s. 14 Section 14. 50.04 (4) (d) 1. b. of the statutes is repealed and recreated to read: