The Reagan administration achieved de facto deregulation of the nursing home industry by slashing federal funds for inspection and certification, according to a report issued yesterday by Ralph Nader's Center for the Study of Responsive Law.
In a foreword, the report accused President Reagan of seeking a "stunning reversal" of federal responsibility to protect 1.3 million elderly Americans in nursing homes by cutting inspection funds and then by proposing to suspend the annual inspection requirement for nursing homes with good records of compliance with minimum standards.
The Health and Human Services Department has said the regulation would allow inspection resources to be focused on nursing homes with poor records and thus would improve conditions throughout the industry. But Congress, fearing the regulation would mean a general easing of inspections, blocked it at least until August.
The report was issued as the House Energy subcommittee on health and the environment held hearings on a bill sponsored by Chairman Henry A. Waxman (D-Calif.) that would create a National Commission on the Regulation of Nursing Homes, which would issue a report and recommendations in late 1984. The regulations would continue to be blocked until six months after the commission report was issued.
James L. Scott, associate administrator for operations of HHS's Health Care Financing Administration, testified against the bill. He said HHS is to hold a meeting Thursday with a variety of groups to discuss the inspection process.
The Nader group report said the Reagan administration had managed to cut the HHS inspection budget for nursing homes, hospitals and others participating in Medicare in half (from $29.8 million in fiscal 1981 to $13.6 million in 1982).
Even though Congress has since restored the budget to $32 million for fiscal 1983, the study said, state officials reported that the cuts had severely disrupted local inspection staffs because of firings and inability to follow up.
Moreover, the report said that even though the administration is requesting $37 million for fiscal 1984, the portion it specifically wants allocated to nursing homes is only between $14 million and $15 million, less than it spent last year. (In addition to these funds, states also get Medicaid funds for inspections; these are expected to total $41 million in fiscal 1983 but are expected to drop to $35 million in 1984.) HHS had no immediate comment on the report.
At the hearing, Rep. Ron Wyden (D-Ore.) challenged HHS plans to inspect only 80 percent of the homes, saying some homes on its list of "good" homes also turned up on a list of homes with serious violations. Scott indicated the department would inspect them, too, but without asking for more money.