For more than 20 years, South Dakota has banned the construction of new nursing homes – except as a replacement for existing facilities — as a way to curb Medicaid spending and encourage the growth of less-expensive alternatives such as assisted living facilities.
That moratorium could be lifted if lawmakers pass Senate Bill 196, which authorizes an annual review of the need for nursing home facilities. If a shortage is found, the Health and Social Services departments would be authorized to invite existing facilities to apply to expand.
The bill is supported by Gov. Dennis Daugaard’s administration and passed the Senate on a 28-2 vote.
The moratorium sets a limit of 8,130 nursing home beds in the state, and currently about 6,154 of the licensed beds are occupied. About 57 percent of nursing home residents are supported by Medicaid, costing the state about $145 million annually.
SB 196 would require nursing home facilities that expand to maintain their current Medicaid participation rate.
A 2006 study found that the demand for nursing home care will increase in South Dakota as the state’s population ages. By 2025, about one-fourth of the state’s residents will be over 65.
The study by Abt Associates also found that nursing home beds were unevenly distributed across the state, and that the demand for nursing home services were greater in western South Dakota than east of the Missouri River.
Earlier in the session, lawmakers unanimously passed a bill to repeal the sunset provision on a 2010 law that allows construction of nursing home facilities on Native American reservations.
The moratorium on licensed nursing home facilities may have served its purpose of saving Medicaid funds, of which the state must pay a portion, but the number and location of nursing home beds should not be limited by a 24-year-old law.
If there is a need for more nursing home beds in the state or the beds are located away from our graying population centers, there needs to be a means to build nursing home facilities in locations where they are needed the most.
The Legislature should pass SB 196.