Operators are praising once-in-a-generation tort reform and new ownership rules designed to attract “good” nursing home operators as key wins in a bountiful legislative session for the skilled nursing sector.
Brent Willett, CEO of the Iowa Health Care Association, described the efforts as those of lawmakers moving quickly “to address a crisis of access to long-term care.”
“Post-pandemic, in Iowa we want to be a premier destination for the nation’s highest-quality nursing facility operators,” Willett said in an email to McKnight’s Long-Term Care News Thursday.
Gov. Kim Reynolds (R) had called out medical malpractice reform as a session priority, suggesting in her Condition of the State address in January that reforms could be particularly helpful to providers in rural areas where there is limited access to healthcare facilities. The new law caps noneconomic damages or damages for pain, suffering and emotional distress that individuals can receive through malpractice lawsuits at $1 million in cases against clinics and individual doctors, including those at nursing homes.
Willett described that on LinkedIn as, “Generational tort reform to kick attorneys who make a living out of putting nursing homes out of business out of our state.”
Another new law enacts “[c]ommon sense change of ownership process reform to attract good operators and keep bad actors out,” Willett wrote. That measure, the Modernization of the Change in Ownership, clarifies that new providers entering the state must submit additional information to help vet an applicant’s financial stability and regulatory track record in other states. The additional documentation includes information about the ownership structure such as all individuals with decision-making authority.
Several states have adopted such rules ahead of or in line with federal efforts to ramp up ownership transparency.
In Iowa, applicants will be required to prove financial suitability to operate a nursing facility with no fewer than three years of operational and statistical documentation, including project initial cash and liquid assets, Willett told McKnight’s. Applicants will also have to show they have not voluntarily surrendered a license in another state and include any licensing complaints, allegations and investigations from other jurisdictions.
The legislature also put into effect a one-year certificate of need moratorium scheduled to begin July 1 that gives regulators time to update the bed-need formula to better match supply with anticipated need, the Iowa Health Care Association said. The moratorium can be waived if there is a “specialized need” or if the average occupancy of all licensed beds within a county or contiguous counties exceeds 85%.
“Both from the policy and appropriations perspective, we would characterize this as one of the most consequential legislative sessions in memory when it comes to working to the best interest of providing access to quality care for seniors in Iowa,” Willett said.
The state’s legislative session wrapped up May 4.