GENERAL ASSEMBLY OF NORTH CAROLINA
SESSION 2001
H	2
HOUSE BILL 1068
Committee Substitute Favorable 4/23/01

Short Title:	Adult Care Homes/Quality of Care.	()	
Sponsors:	     	
Referred to:	     	
April 10, 2001

A BILL TO BE ENTITLED
AN ACT TO DIRECT THE DEPARTMENT OF HEALTH AND HUMAN SERVICES TO STUDY ISSUES RELATING TO LONG-TERM CARE; AND TO DIRECT THE DEPARTMENT OF HEALTH AND HUMAN SERVICES TO ESTABLISH A QUALITY IMPROVEMENT CONSULTATION PROGRAM.

The General Assembly of North Carolina enacts:
SECTION 1.(a)  The General Assembly recognizes that the imposition of penalties for deficiencies in meeting licensure requirements is not the exclusive method for ensuring quality of care in licensed adult care homes. The Department of Health and Human Services shall explore methods to improve and reward quality of care provided by adult care homes.  In conducting this undertaking, the Department shall consider and report specifically its findings and recommendations on all of the following:
(1)	Amending current law to allow extension of the licensure period and survey period for adult care homes with a good record of compliance and in the absence of consumer complaints. 
(2)	Whether to cap allowable indirect costs for adult care homes similar to that imposed on nursing homes, but also allowing a higher capped direct rate of reimbursement in order to provide incentives for higher quality direct care to residents.
(3)	Whether a different approach should be adopted for setting reimbursement rates for adult care homes that would replace the current 'State average' method. The purpose of the different approach is to provide incentives to facilities to operate more efficiently and reinvest resources saved from efficiency in higher quality care.
(4)	Aspects of the quality assessment/monitoring process that should be changed or modified under State authority.
(5)	The Department of Health and Human Services shall offer joint training of Division of Facility Services consultants, county DSS adult home specialists, and adult care home providers. The training shall be offered not less than two times per year, and subject matter of the training should be based on one or more of the 10 deficiencies cited most frequently in the State during the immediately preceding calendar year. The joint training shall be designed to reduce inconsistencies experienced by providers in the survey process, to increase objectivity by DFS consultants and DSS specialists in conducting surveys, and to promote a higher degree of understanding between facility staff and DFS consultants and DSS specialists in what is expected during the survey process.
SECTION 1.(b)  The Department shall report the status of its activities under this section to the North Carolina Study Commission on Aging not later than October 1, 2001. Not later than March 1, 2002, the Department shall submit its final report to the North Carolina Study Commission on Aging and to the Senate Appropriations Committee on Human Resources and the House of Representatives Subcommittee on Health and Human Services.  The final report shall include recommended legislation for consideration by the 2002 Regular Session of the 2001 General Assembly.
SECTION 2.  The Department of Health and Human Services shall develop a Quality Improvement Consultation Program.  The purpose of the program is to assist providers in the development of quality improvement plans for each facility. The Quality Improvement Consultation Program shall be developed in consultation with the Division of Facility Services and representatives of facilities and programs.  The Department shall use funds appropriated in its continuation budget for this purpose for the 2001‑2002 and 2002‑2003 fiscal years.  The Department shall report the status of its activities under this section to the North Carolina Study Commission on Aging on October 1, 2001, and March 1, 2002.
SECTION 3.  The Department of Health and Human Services shall convene a Quality of Standards Work Group to explore alternatives to existing oversight and survey practices that will ensure quality in adult care homes.  The Work Group shall do the following:
(1)	Define and provide guidance on terms applicable in the survey and oversight process to ensure uniformity. Terms that should be defined and clarified include the following:
a.	Substantial evidence.
b.	Imminent danger.
c.	Condition detrimental to health and safety.
d.	Hindrance of proper performance of duties.
e.	Alleged violation.
f.	Substantial failure to comply.
g.	Serious physical harm.
h.	Substantial risk that death or physical harm will occur.
i.	Present a direct threat to health and safety.
j.	Deficiency.
k.	Extent of violation.
l.	Probability of death or serious harm.
m	Reasonable diligence.
The Department shall ensure that the definition and clarification of terms is included in basic and continuing survey training.
(2)	Identify rules that impede the direct care of residents or prohibit resident choice and develop a proposal for repeal of those rules, including any necessary repeal of, or amendment to, current law that is the basis for the rule.
The Work Group shall consist of representatives of the Division of Facility Services, the North Carolina Assisted Living Association, Inc., and the North Carolina Association of Long Term Care Facilities.
SECTION 4.  The Department of Health and Human Services shall study the cost to the State of reducing the county share of State/County Special Assistance from fifty percent (50%) to twenty‑five percent (25%), phased in over a five‑year period.  The Department shall report its findings to the North Carolina Study Commission on Aging and the House of Representatives and Senate Appropriations Committees on Health and Human Services not later than October 1, 2001.
SECTION 5.  The Department of Health and Human Services shall study alternative ways to reimburse adult care homes for the costs of residents residing in special care units, taking into account the particular needs of those residents.  The Department shall report its findings and recommendations not later than March 1, 2002, to the North Carolina Study Commission on Aging and the House of Representatives and Senate Appropriations Committees on Health and Human Services.
SECTION 6.  The Department of Health and Human Services shall study and make recommendations on statutory changes that would be necessary in order to delineate the various populations currently regulated as adult care homes according to the particular needs of those populations.  The Department shall report its findings and recommendations to the North Carolina Study Commission on Aging not later than March 1, 2002.
SECTION 7.  This act becomes effective July 1, 2001.