State and Veterans Nursing Homes (09/15/2005)

Final
STAFF SUMMARY OF MEETING

STATE AND VETERANS NURSING HOMES

Date:	09/15/2005	ATTENDANCE

Time:	09:36 AM to 03:20 PM	Balmer	X
		Entz	X
Place:	SCR 356	Hodge	E
		Jahn	X
This Meeting was called to order by		Sullivan	X
	Senator Tochtrop	Taylor	X
		Tupa	X
This Report was prepared by		(None), (None)	X
	Geoff Johnson	Tochtrop	X
		X = Present, E = Excused, A = Absent, * = Present after roll call

Bills Addressed:		Action Taken:
Introduction of Commission Members Perspectives of the Board of Veterans Affairs		- -

09:40 AM - Call to Order

Senator Tochtrop called the meeting to order. All members of the Legislative Oversight Committee were present at the meeting with the exception of Representative Hodge.

9:42 AM - Introduction of Members of the State and Veterans Nursing Home Commission

Senator Tochtrop introduced the members of the State and Veterans Nursing Home Commission. All eleven members of the Commission were present with the exception of Rodolfo Arguello. (The Commission members held an organizational meeting over the lunch hour on this day and elected Ralph Bozella as their Chairman. The Commission plans to attend the next meeting of the Legislative Oversight Committee (LOC) on October 25, join the LOC for lunch and a tour of the Fitzsimons State and Veterans Nursing Home, and then hold a second Commission meeting at Fitzsimons.)

9:45 AM - Perspectives of the Colorado Board of Veterans Affairs and the United Veterans Committee of Colorado on Colorado's State and Veterans Nursing Homes

Mr. Ralph Bozella, Chairman, Colorado Board of Veterans Affairs, described the activities of the Colorado Board of Veterans Affairs. He said that Colorado has five veterans nursing homes dedicated to veterans, and one open to persons other than veterans. He said that many problems were identified in the past at the Fitzsimons Home and that the home was nearly lost. He noted that the homes operate with (1) census revenues and (2) with 505 enterprise funds. He noted that there is no board of directors that oversees the operations of all of the homes. He pointed out that the Board of Human Services is a rule-making board, but has no administrative oversight over the facilities. He said that the Fitzsimons facility's failure of state and federal surveys demonstrated the need for closer oversight of the nursing homes. As a result, Governor Owens provided $1 million dollars to hire Pinon Management, Inc. to manage the Fitzsimons facility. The Board requested that the Governor create a Fitzsimons Task Force. Later, the Board asked the Governor to create a Fitzsimons Accountability Committee which was formed and chaired by the Lieutenant Governor. The Committee recently issued its recommendations for improving the Fitzsimons facility. A copy of these recommendations is available at on the website of the Colorado Lieutenant Governor
(http://www.colorado.gov/ltgovernor/).

Mr. Bozella said that a number of issues should be investigated in the course of examining of Colorado's State and Veterans Nursing homes including: staffing the facilities, the use of "505 enterprise funds," how other states run their nursing homes and pay for capital needs, the ability of the state to meet federal matches for funds, the potential for rejuvenating the State Veterans Home at Home Lake, administration of all of the homes, and an examination of the efficiency and effectiveness of all of the homes.

Mr. Bozella said that veterans care deeply about the homes. He noted some of the problems that occurred at Fitzsimons including: the spread of a virus; problems with pharmaceutical distribution; and funding issues.

10:00 a.m.

Senator Entz said that the Fitzsimons facility has been underfunded and overbuilt from the beginning. He said that the other four nursing homes have done an excellent job in their settings. He said that the staff at the rural homes are dedicated and that the Fitzsimons facility is too big. Senator Tochtrop said that urban nursing care professionals also care very much about patient care.

10:03 AM

Mr. Marvin Meyers, Legislative Chairman, Colorado Board of Veterans Affairs said that, in the past, he has been a licensed nursing home administrator. He said that there are 465,000 veterans in Colorado and that the nursing homes are very important to these veterans. He wants the families of Colorado veterans to be confident that past problems with the homes will not happen again. He said that, in the past, many of the facilities have operated independently. He said that there should be more coordination in the operation of these facilities.

Mr. Meyers said that legislators and administrators come and go but that the veterans will always be in Colorado. He said that Coloradans veterans deserve the best that the state can provide. Mr. Meyers described the original efforts to establish Fitzsimons. He noted that the ground- breaking for the facility was held in 2000, and that the first residents moved into the facility in September, 2002. He stated that within one year of opening the facility was surveyed and was found to be grossly out of compliance with standards. As a result of the surveys, he noted that the Colorado Board of Veterans Affairs felt compelled to act.

Mr. Meyers noted that the U.S. Department of Health and Human Services directed that an independent contractor be brought in to stabilize the situation at Fitzsimons. He said that closing the facility would have obligated the state to pay back $16 million that was provided by the Veterans Administration for its construction. He said that a private contractor, Pinon Management, Inc., was hired and quickly rectified many of the facility's problems. He added that Pinon Management, Inc. was hired with $1 million that the Governor provided from discretionary funds.

Mr. Meyers noted that prior to the hiring of Pinon Management, Inc., there were more than fifty vacant staff positions at Fitzsimons. Most of these vacant positions were for nursing staff, including the Director of Nursing and the Infection Control Nurse. He said that he cannot understand why the positions were not filled. He also noted that Pinon Management, Inc. discovered that Fitzsimons had uncollected accounts receivable in the amount of $2.6 million. Of this amount, $2.2 million was eventually recovered. Mr. Meyers said that the facility was overrun with a viral infection, resulting in the hospitalization of two residents.

Mr. Meyers noted that the former administrator of Fitzsimons produced a paper trail of documents demonstrating that repeated requests for staffing were made to the Department of Human Services. He added that required records were not maintained by employees at Fitzsimons and that credentialing requirements were not met. He said that the Department Human Services mismanaged the home and nearly destroyed it within one year. He said that the problems at Fitzsimons were systemic and added that the problems at Fitzsimons may have had a negative financial impact on the state's other veterans nursing homes.

Mr. Meyers said that no person has ever been held accountable for what happened at Fitzsimons. He noted that there are inherent delays in hiring staff for the facilities due to Colorado's personnel system. Senator Tochtrop said that Fitzsimons did not have a good financial officer initially and that the revenues were mismanaged. She added that Pinon Management, Inc. established appropriate financial controls when they took control of the facility.

Senator Tochtrop said that she is concerned that there is no record of the findings of the original task force that examined Fitzsimons and expressed interest in obtaining this document if it exists. Representative Jahn, who served as a member of this original Fitzsimons investigatory body said that the task force identified a lack of expertise in long-term care services at Fitzsimons and said that there was 100 percent system failure at the facility.

Mr. Meyers said that there was a lack of training in every department at Fitzsimons and added that for the future of the nursing homes to improve, the Committee and Commission should understand what happened in the past. He said that the nursing facilities should probably be out of Colorado's personnel system.

Representative Balmer said that there should be no higher priority in the state budget than taking care of these nursing home residents. Representative Jahn suggested that the Department of Human Services outline the process and time-line by which the facilities are staffed.

Mr. Meyers said that the Colorado Board of Veterans Affairs is pleased with the appointment of Dr. John Johnson to head up the Division of State and Veterans Nursing Homes and has been happy to work with Mr. Ken Cole in the Department of Human Services. He said that the veterans community will continue to work with the Department of Human Services to make the facilities as good as they can be. Mr. Meyers commented on the exclusion of the Walsenberg nursing home from House Bill 05-1336. He pointed out that the Walsenberg facility has had tremendous turnover in management and suggested that the Legislative Oversight Committee consider this situation.

Mr. Meyers said that the nursing homes are part of an industry and should be operated as a business. Representative Balmer suggested that the potential for contracting with health care facilities near the Fitzsimons nursing home should be explored. Mr. Meyers said that Fitzsimons was put on the right path by Pinon Management, Inc. but that they do need an effective marketing plan. Representative Jahn requested that the committee receive recent survey results for the Trinidad facility.

Senator Entz asked that the operation of the Walsenberg facility be considered by the LOC, perhaps the director of the facility could present to the LOC.

10:57 AM

Mr. Bill Sinclair, member of the Colorado Board of Veterans Affairs, said that Colorado's veterans are losing confidence in state government. He said that the state does not do enough for its veterans. He noted that Colorado spends the least amount of money per capita on veterans programs among the fifty states, with the exception of Wyoming. He said that Illinois is the top spender among the states, and added that Colorado spends 97 cents per year for each of its veterans. He suggested that the administration of the veterans nursing homes be exempted from the state personnel system. He agreed that the LOC should examine operation of the Walsenberg facility. He said that the Department of Military and Veterans Affairs would be an inappropriate agency to administer the nursing homes.

11:08 AM - Role of the Department of Veterans Affairs (VA) - Recent and Historical Survey Results

Mr. Wayne Valey, Veterans Administration, commented on the role of the Veterans Administration in running the state's veterans nursing homes. He said that the per diem rate provided by the Veterans Administration is in the high $50 range right now (at $59). He said that states are granted the authority to operate the nursing homes by the VA. He distributed copies of federal regulations which set forth the requirements with which state and veterans nursing homes must comply and results of federal surveys of the facilities in Colorado (Attachment A and B.)

Mr. Valey noted that the VA ensures that the nursing homes comply with 158 federal standards and that administrators of the homes are aware of these federal requirements. He said that the VA provides in excess of $7 million in "federal per diem" to Colorado each year. The per diem rate is currently set at $59. He noted that this rate is uniform across the United States. Mr. Valey added that the VA cannot pay more than 50 percent of the daily patient rate at the facilities under federal law. He said that the states have responsibility for managing and controlling the homes. He pointed out that it is the VA's role to ensure that standards are met. He noted that the VA retains the authority to "remove recognition" of the homes. Mr. Valey noted that state governments represent to the VA that they are able to meet VA standards for operation of nursing homes in return for the VA's financial support for the veterans nursing homes. He pointed out that residents may also use pay sources such as Medicaid, Medicare, or private pay.

11:21 AM

Mr. Valey noted that the daily rates are set by the nursing homes. Any amounts exceeding the $59 contribution by the VA must come from Medicaid, Medicare, or "private pay" from the residents own assets. Senator Tochtrop said that the VA funding is a good deal for the state. Senator Taylor said that, in his opinion, the federal government is under-funding veterans programs across the country. Mr. Valey said that the rates vary among the Colorado's veterans nursing homes. Fitzsimons charges $190 per day, which exceeds rates for most of the private for-profit facilities. Mr. Valey noted that the VA also provide some home-care services.

11:34 AM

Mr. Valey distributed and commented on a diagram that explains the stakeholders involved in operating a veterans nursing home (Attachment C). He spoke about administrative positions that are necessary to operate the homes. He said new nursing homes often have start-up problems. He commented on the Walsenberg facility and noted that this home has had problems with high rates of employee turnover. He suggested that the division should have long-term strategic plans for all of the homes.

11:42 AM - State and Veterans Nursing Homes Overview

Mr. Ken Cole, Deputy Director and Chief Financial Officer, Office of Behavioral Health and Housing, Department of Human Services, introduced himself and said that under his watch such a situation as occurred at Fitzsimons will never happen again. He commented on his background and on Pinon Management, Inc.'s work at the Fitzsimons facility. His stated goal is to regain the trust of the legislators and Colorado's veterans in leading the Division. He noted that each nursing home now has a business plan and a management plan. He said that copies of the Division's annual report, census trends at the facilities, and the marketing plans and business plans for each facility will be provided at the next LOC meeting.

Dr. John Johnson, Director, Division of State and Veterans Nursing Homes, presented a power point presentation (Attachment D). He commented on the division's mission and provided a map showing the location of the nursing home facilities. He said that there are currently about 686 beds in the system and that approximately 608 state employees and 136 non-state employees (Walsenberg staff) are employed by these nursing homes.

Senator Tochtrop said that she would like to have a breakdown of which departments these employees work in. Dr. Johnson provided an overview of the facilities and discussed the administrative structure of the division.

12:04 PM

Mr. Ken Cole, said that the division lacked key management staff during the Fitzsimons crisis. Dr. Johnson commented on the census at the homes and said that a least 75 percent of the population in each home must be composed of veterans. Non-veterans must still meet admission requirements. Dr. Johnson commented on admissions and discharges at the facilities in the last year. He said that many of the residents coming into the homes are very frail.

Senator Tochtrop said that the LOC should have a comparison of costs of residency with private facilities. Mr. Ken Cole said that the division may be able to provide comparable data at the next LOC meeting.

Dr. Johnson commented on the average acuity of residents in the facilities. He noted that the Trinidad nursing home has had difficulty attracting nurses to work in the facility. He said that the Home Lake nursing home has had a problem with insufficient applicants for residency. He commented on the level of nursing home staff turnover.

Representative Jahn asked if exit interviews are conducted when employees leave the facilities. Dr. Johnson said that he will investigate the issue of high turnover in the facilities.

Dr. Johnson showed a power point slide illustrating the 2004 state survey of deficiencies.
Mr. Ken Cole said that the most recent survey of the Trinidad facility will be made available to the LOC. He said that currently the Trinidad nursing home has no deficiencies.

Mr. Ken Cole commented briefly on the financing of the division and the nursing homes. He noted that he and Dr. Johnson will cover this topic more extensively at the next LOC meeting. He said that the division ended the year at a "$194,000 cash profit," but that when the bond payments for the Fitzsimons facility are added into the calculation the balance becomes a $206,994 loss for the fiscal year.

Mr. Kevin Ross, Project Manager, Division of State and Veterans Nursing Homes, commented on capital needs at the nursing homes. He said that the division works closely with survey teams and advisory boards to determine facility needs. He commented on recent capital improvements at four of the facilities. He commented on the historic buildings at the Homelake facility and said that approximately $5.2 million in improvements are planned for Homeake.

Mr. Ross said that many of the veterans nursing home facilities have never been renovated. He said that VA funds and "energy savings" are being used to finance many of the improvements planned for the nursing homes. He noted that approximately $15 million in improvements are currently planned for the facilities and said that the division tries to be very creative in finding funding for the capital improvements.

12:47 PM

Recess.

1:40 PM - Regulation of State and Veterans Nursing Homes by the Colorado Department of Human Services

The Legislative Oversight Committee reconvened. Mr. Ken Cole provided a power point presentation, beginning with a slide summarizing the goals of the division (Attachment E). He said that there are currently no management positions vacant at Fitzsimons facility.

1:45 PM

Mr. Cole commented on the regulation of state and veterans nursing homes by the division. He presented goals of the division and said that weekly reports are provided to him on staffing levels at the facilities. Monthly census reports are also provided. He discussed the various reports that are produced to monitor the facilities.

Mr. Cole said that the division maintains oversight over the facilities' budgets, procurement, and contract management. He commented on the recommendations of the Fitzsimons Accountability Committee. He said that the department will submit a supplemental request this year seeking funding for a management contract to be administered by the division. Senator Entz commented on the proposed supplemental.

Dr. Johnson commented on formal and informal oversight of the facilities. He commented on procedures of the "pre-survey process" and quality improvement programs.

2:05 PM – Regulation of State and Veterans Nursing Homes and Recent and Historical Survey Results - Colorado Department of Public Health and Environment

Dr. Ellen Mangione, Director, Division of Health Facilities, Colorado Department of Public Health and Environment, distributed copies of her power point presentation (Attachment F) and introduced Mr. Dennis Winn, Compliance Surveyor, Program Development and Evaluation, and Ms. Shelley Hitt, Division of Health Facilities and Emergency Medical Services, Department of Public Health and Environment.

Dr. Mangione commented on regulation of the nursing homes by the department. She said that the department has a dual role – licensure and certification of the facilities. Initial state licensing surveys and initial federal certification survey are conducted by the Department. The federal government contracts with the department for federal certification surveys.

Dr. Mangione commented on certification of other nursing facilities in the state. The department determines whether the facilities are in compliance with Medicaid and Medicare standards.

Mr. Dennis Winn said that the department surveys 214 nursing homes for Medicaid and Medicare compliance in the state. Surveys are unannounced and happen about every 15 months. Survey results are provided to the federal Centers for Medicaid and Medicare Services (CMS) which conducts all enforcement actions. The department conducts surveys under federal certification regulations published in the Code of Federal Regulations. Each deficiency that is written is assigned a letter code based on its potential for harm under the "scope and severity grid." Certain levels of deficiencies will preclude participation in Medicare and Medicaid.

Mr. Winn summarized the survey process. The "pre-survey" phase identifies the concerns of a sample of residents. Quarterly information is collected and passed on to a federal data base. The survey team has a great deal of information before they walk in the door.

Mr. Winn described the on-site survey process. The department observes quality of care and quality of life issues for specific residents. They talk to residents and their families. They conduct group interviews. Deficiency determination is ongoing throughout the process.

2:22 PM

Dr. Mangione commented on enforcement remedies, conditional licenses and license revocation. She noted the differing levels of remedies that are available.

Mr. Winn commented on recent survey findings (in last three federal fiscal years). He showed a slide to the committee listing certification survey results at each facility. He commented on remedies that have been imposed by CMS at the Fitzsimons, Homelake, and Trinidad facilities. Mr. Winn commented on the severity of various levels of deficiencies and how these deficiencies are addressed. He noted that there is the potential for loss of federal certification.

2:40 PM – Input from State and Veterans Nursing Homes Community Advisory Boards

Ms. Sue Detts, member of the Homelake State Veterans Home Community Advisory Board (CAB), commented on operations of the nursing home. She said that her mother is a resident at Homelake. She said that the facility is strongly supported by the Homelake advisory board and that there is a strong volunteer base at Homelake.

She said that the census is down at Homelake. This is due to the fact that so many more families are keeping their family members at home. She noted that Homelake has a new marketing plan. She said that the management team has been in place at Homelake for a long time. Eight to ten members belong to the CAB at Homelake.

Mr. Gary Kotz, Facility Director, Fitzsimons State and Veterans Nursing Home, said that the Fitzsimons facility also has a CAB. Senator Entz said that he believes that all of the facilities should have CABs.

2:51 PM – Perspectives of State and Veterans Nursing Homes Facility Directors

Mr. Bob Shaw, Director, Colorado State Veterans Home at Rifle, commented on the work of a nursing home administrator. He said that many residents of the homes suffer from post-traumatic stress disorder. He noted that approximately 80 percent of residents are male. This is the reverse of the gender makeup at most private nursing homes. He said that new facilities have commonly had operational problems and that it is important to have appropriate expertise in place before the facilities are opened.

Barbara Moore, Director, Colorado State Veterans Home at Florence said that her philosophy differs from that of private sector nursing homes directors because she is a public servant. She commented on marketing efforts at the homes and noted that the census at the homes is critical. Bob Shaw commented on the challenges of finding qualified employees. Ms. Moore said that 60 percent of the residents in her facility receive Medicaid, in contrast to about 80 percent of residents in private nursing homes Medicaid recipients in private nursing homes.

3:20 PM

The committee meeting adjourned. The next meeting of the committee will be held on October 25, 2005 in Senate Committee Room 356 at the State Capitol Building.