Underused ARCHs; licenses

Requires DOH to stop licensing new Type I adult residential care
homes (ARCH) on an island until the percentage of Type I ARCHs
having 3 or fewer residents falls below 10% on that island but
allows licensing on a case-by-case basis on neighbor islands that
demonstrate a need for ARCHs.  Requires DHS to strongly encourage
public-pay clients to use underutilized ARCHs.  Effective upon

HOUSE OF REPRESENTATIVES                H.B. NO.644        
TWENTIETH LEGISLATURE, 1999                                
STATE OF HAWAII                                            

                   A  BILL  FOR  AN  ACT



 1      SECTION 1.  The legislature finds that adult residential
 2 care homes play a crucial role in addressing the long-term care
 3 needs of Hawaii's aging population.  Adult residential care homes
 4 provide twenty-four-hour living accommodations for unrelated
 5 adults who require at least minimal assistance in the activities
 6 of daily living, personal care services, protection, and health
 7 care services, but who do not need the professional health
 8 services provided in an intermediate, skilled nursing, or acute
 9 care facility.  Type I adult residential care homes are allowed
10 to accommodate a maximum of five unrelated adults.  Type II homes
11 allow accommodations for six or more such persons.  These homes
12 are based in the community and offer an important long-term care
13 alternative.  This is particularly true with the advent of newly
14 authorized expanded adult residential care homes which provide
15 twenty-four-hour living accommodations to nursing facility level
16 individuals who have been admitted to a medicaid waiver program,
17 or private pay clients who have been certified for this type of
18 facility.
19      However, the legislature finds that many regular Type I

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                                     H.B. NO.644        

 1 adult residential care homes are currently underutilized.  Some
 2 have only one, two, or three residents.  This low utilization
 3 rate does not allow the operators of these Type I adult
 4 residential care homes to take full advantage of economies of
 5 scale in providing time- and labor-intensive twenty-four-hour
 6 care for their clients and thus creates great financial pressure
 7 for the operators to remain in business.  It is the purpose of
 8 this Act to maximize the utilization of regular Type I adult
 9 residential care homes (not expanded adult residential care
10 homes) by imposing a moratorium on the licensing of new regular
11 Type I adult residential care homes and by requiring the
12 department of human services to strongly encourage its public-pay
13 clients to enter these existing underutilized homes.  Because the
14 underutilization problem exists primarily on the island of Oahu,
15 where most of the homes are located, provision is made to avoid
16 exporting the problem to the neighbor islands by allowing the
17 department of health to issue new licenses on the neighbor
18 islands on a case-by-case basis where there is a demonstrable
19 need for new homes.
20      SECTION 2.  (a)  The department of health shall determine
21 the number of existing Type I adult residential care homes in the
22 State that have three or fewer residents as of June 30, 1999, and

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                                     H.B. NO.644        

 1 shall identify each specific such facility.  For the purposes of
 2 this Act, these identified facilities shall be designated as
 3 underutilized.  The department of health shall cease issuing
 4 licenses to operate new regular Type I adult residential care
 5 homes on each island until the percentage of these underutilized
 6 homes on each island falls below ten per cent of the total amount
 7 of regular Type I adult residential care homes on each island;
 8 provided that the department may issue new licenses on a case-by-
 9 case basis on the neighbor islands if there is a demonstrable
10 demand for such facilities.
11      (b)  The department of human services shall strongly
12 encourage its clients, for whom the department makes
13 reimbursement payments for residence in regular Type I adult
14 residential care homes but who have not yet been admitted, to
15 enter those homes designated as underutilized by the department
16 of health pursuant to this Act.
17      (c)  This Act shall not apply to expanded adult residential
18 care homes.
19      SECTION 3.  This Act shall take effect upon its approval.
21                           INTRODUCED BY:  _______________________