Stricter Regulations and Higher Fees Place Strain on Assisted Living Facilities

Assisted living facilities in many states are struggling under Medicaid funding cuts. On Sunday, November 14th, the Augusta Chronicle reported on the especially fragile state of South Carolina’s assisted living industry. The state’s nearly 500 assisted living facilities are struggling under proposed tighter fire regulations and increased fees that could cause facilities to shut down, leaving residents to find new housing. In addition, many facilities are opting to refuse residents who are receiving public assistance or would be difficult to evacuate in the event of a fire, in order to more easily comply with new proposed regulations. New SC regulations throw assisted living facilities off balance

The new proposed state regulations for South Carolina assisted living facilities, which have also reduced the required staff-to-resident ratio in recent years, would now require staff to be able to completely evacuate all residents in under eight minutes in the event of a fire; if they are unable to do so, a sprinkler system must be installed. Per-bed fees (currently $10) would also be doubled over the next three years.

State officials say the move is reasonable because fees have not been increased since 2001, and inflation has contributed to increased costs for inspections and quality control. A lack of funding would mean the quality of facility oversight would suffer, and in turn, resident satisfaction could decline. In addition, the senior population in South Carolina is growing, as it is in the U.S. as a whole, which will place additional strain on state resources.

Assisted living facilities that would be hit the hardest by the proposed changes are smaller — those with 20 or fewer residents, which typically rely primarily on Medicaid funding. Among larger facilities that house more than 20 residents, 86 percent of residents are paying privately. Private pay fees are higher than Medicaid reimbursement; this combined with the higher total number of residents contributes to larger assisted living communities being able to weather the financial storm more easily than those with fewer residents.

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