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Florida Nursing Homes Required to Make Big Investments in Emergency Preparedness within 60 Days

The tragic deaths of eight nursing home residents in Hollywood, Fla., in the aftermath of Hurricane Irma prompted a number of policy changes. Legislation was introduced requiring seniors housing facilities to have emergency power sources for five days in the event of a power outage. Florida Governor Rick Scott announced an immediate rule requiring similar resources to be implemented at all assisted living and skilled nursing communities in the next 60 days. The Florida Health Care Association, the Florida chapter of the national American Health Care Association that represents nursing homes, is calling an emergency summit this Friday to convene stakeholders and discuss the rule announced by Gov. Scott.


This post only addresses the Florida-level policy changes. No moves have been made yet at the federal level to increase regulations over nursing homes nationwide in response to the tragedy, but Sen. Greg Walden (R-Ore) hinted at potential legislation. If that happens, I’ll be sure to update you on the federal changes.


What Happened at Hollywood Hills

The nursing home where eight resident died experienced power failure to its air conditioning system as a result of Hurricane Irma beginning on Sunday. The building was without air conditioning, but not power, until Wednesday, at which point the deaths started to occur. Representatives from the facility claim to have contacted Florida Power & Light(FPL), the governor’s office, and other emergency contacts in the state in an effort to restore power to the air conditioning. A criminal investigation is now underway to understand exactly what went wrong. When the power was restored on Wednesday, after residents had already been evacuated, the air conditioning problem reportedly took only 20 minutes to resolve. FPL considers hospitals and 911 emergency centers critical locations for electricity to be restored, but nursing homes including Hollywood Hills do not qualify as the highest priority sites. FPL says it encouraged anyone who experienced a medical emergency as a result of the power failure to call 911. Hollywood Hills is located directly across from a major hospital that never lost power during the storm. Staff at the nursing home reported that all residents were fine on Tuesday night and that the emergency situation did not develop until Wednesday morning. Existing regulations do not require that nursing homes maintain air conditioning during a power failure, but do require that residents be evacuated if internal temperatures are too high.


Gov. Scott and Fla. Sen. Book Introduce Emergency Preparedness Proposals

Florida Senator Lauren Book introduced legislation on Friday that would “add electricity and emergency power sources to unannounced inspections of nursing homes and assisted living facilities, as well as require equipment sufficient to provide adequate day-to-day electricity, a fully operational emergency power source, and a supply of fuel sufficient to sustain the emergency power source for at least five days during a power outage,” according to the press release. Sen. Book also signed a letter to Gov. Scott requesting a criminal investigation into the deaths of the Hollywood Hills residents. The new rule would go into effect July 2018, if passed.

Gov. Scott’s emergency rules were announced on Saturday via regulatory bodies, the Agency for Health Care Administration (skilled nursing) and Elder Affairs (assisted living). The two proposals are similar in that they both require nursing homes and assisted living facilities to have working generators in the event of power failure. The governor’s rules are considerably stricter than the proposed legislation in that facilities in the state have 45 days from last Saturday to submit a plan to their respective regulatory body and within 60 days to have completed the plan, including installation and inspection of the technology. The emergency rules also explicitly state that the backup technology must be able to maintain reasonable temperatures in the buildings. The emergency rule differs from the proposed legislation in that this backup power source only needs to be prepared to run for four instead of five days.

A major difference in the two proposals is the rule-making process. The legislative process under which Sen. Book’s rule would be considered is traditional. The legislation is introduced now, it will be considered by elected legislators, if it passes in the state Senate and the state House, it will go to the governor for signature and then the regulatory bodies would oversee the implementation of the rules. The other route that rule making can take is directly through the regulatory bodies, but under normal circumstances, those rules would be subject to public comment before becoming law. Sen. Book’s proposal still has the opportunity to be legislated by representatives, but Gov. Scott’s proposal is current law as of Saturday, circumventing the often time-consuming public comment period. His rule is an “emergency rule” and therefore can bypass the normal rule-making procedure.


The Industry Response

The Florida Health Care Association announced a summit this Friday, September 20th, for its members, electric companies, and other relevant stakeholders to discuss implementation of Gov. Scott’s emergency rules. Hollywood Hills happens to be among the few properties in the state that does not belong to the trade association, which boasts in its announcement that members went through disaster preparedness training just one week before the hurricane hit. Some immediate concerns are apparent under the Governor’s rules, and the trade association summit will likely discuss some of these.

For example, the proposed timeline of 60 days for complete compliance with the installation and inspection of backup generators that can sustain normal interior temperatures for four days may not be sufficient time for operators to comply. Even if every nursing home in the state engages a contractor today for the purpose of complying with the rule, the fire department may not have enough time to complete the inspections. The state is home to 685 nursing homes and 3,109 assisted living facilities.

The feasibility of all facilities being compliant within 60 days is questionable, and its possible the Florida Health Care Association will push back against the time frame following the summit on Friday. Of course, regulations always come with a price tag, which may be too high for smaller properties to comply with the rules. For example, this interview with RAND Engineering & Architecture energy team leader David Brijlall suggests a backup generator for a 50-unit apartment building could cost $250,000. The unit would also need 1,500 gallons of fuel to run the generator for one week. A quarter of a million dollars is a significant upfront cost for many nursing homes already struggling with declining occupancy and margins. Fuel storage is an additional cost to consider as that activity is also regulated by a different set of rules and could be challenging to achieve in some buildings due to location and existing infrastructure.

The philosophical issue with the Governor’s emergency rules will probably also be addressed at the summit. Does the Governor have the statutory authority to impose these regulations without public comment? The move could be considered an overreach based on the financial burden placed on facilities. A lawsuit could stall the rule, alter it, or remove it completely. My guess is that nursing homes in Florida will wait and see what their trade association has to say on Friday before engaging contractors in this costly infrastructure improvement project.

If properties cannot effectively push back against these rules, by extending the timeline or requiring the state to shoulder some of the cost burden or easing the required generator capacity, then we may see a harried scramble to acquire the capital necessary to fund these improvements on a very short time frame. Investors and operators in Florida will no doubt be following the developments in Tallahassee very closely, as will those businesses in other industries that could likely benefit from the emergency rules such as engineering firms poised to win these contracts. The sudden increase in demand could also serve to drive up costs of the projects, and the available supply of firms and labor to complete these projects within 60 days is uncertain.


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