Opinion Number

Dear Senator Theunissen:

This office is in receipt of your request for an opinion of the Attorney General in regard to approval of the Vermilion Nursing Center, Inc. You indicate the approval of the Nursing Center was received on May 5, 1994 but the issuance was suspended, and by letter dated Dec. 16, 1996 the Secretary of the Department of Health and Hospitals advised that the suspension was no longer in effect. The letter further stated as follows:

The approved beds must be enrolled in the Title XIX Program within sixteen (16) months of the date of this letter. An extension may be granted, at the discretion of the Department, when delays are caused by circumstances beyond the control of the applicant. Inappropriate zoning is not a basis for extension. If the beds are not enrolled in the Title XIX Program within the time limit specified, the approval will automatically expire.

However, in a letter dated January 27, 1998 to Mr. Lyles of the Bureau of Health Services Financing of the Department of Health and Hospitals, it was stated that it was understood that Mr. Lyles was of the opinion that "the approval granted to Vermilion Nursing Center, Inc. shall not be suspended if construction on the facility envisioned by the permit is actually commenced by June 30, 1998, and if the construction is completed and such facilities or beds are actually certified and enrolled by December 30, 1999."

Based upon this information you ask that the matter be reviewed and advise whether the approval granted to Vermilion Nursing Center, Inc. is still valid.

We note that the Department of Health and Hospitals adopted the rule providing for Facility Need Review in August 1995 as authorized under R.S. 40:2116, and repealed entirely the existing regulations for facility need review which had been adopted on January 20, 1991. However, the revised rule recognized that the department would be responsible for reviewing proposals for facilities and beds by health care providers seeking to participate in Medicaid.

R.S. 40:2116(D) by the 1995 amendment directed that the Department of Health and Hospitals shall implement a moratorium on Title XIX certified beds, and not approve any additional nursing facilities. However, Act 1429 of 1997 added Sections E and F to R.S. 40:2116, and set forth in (E) that the department shall suspend approval, certification and enrollment of nursing facility beds which were previously approved to participate in the Title XIX program "except as provided in Paragraphs (2) and (3)". Paragraph (3) is relative to previously approved but unbuilt nursing facilities and directs that the department "shall not suspend approval, certification, and enrollment if construction has actually begun by June 30, 1998, and construction is completed and such facilities or beds are actually certified and enrolled in the Title XIX program by December 31, 1999." For those previously approved beds not certified and en-rolled in the Title XIX program by December 31, 1999, the department "shall suspend approval, certification and enrollment."

Thus, it appears that chronologically the project was approved on May 5, 1994, but on Dec. 16, 1996 the builder was informed the beds would have to be enrolled by April, 1998. However, Act 1429 of 1997, relative to unbuilt facilities, required those facilities with previous approval must commence construction by June 30, 1998. Based upon these occurrences, we find pursuant to R.S. 40:2116 that the letter dated January 27, 1998 is correct wherein it is stated that approval granted to Vermilion Nursing Center shall not be suspended if construction "is actually commenced by June 30, 1998, and if the construction is completed and such facilities or beds are actually certified and enrolled by December 31, 1999."

Therefore, in answer to your inquiry we find under the present statutory provisions that the department shall not suspend approval, certification and enrollment if construction commenced by June 30, 1998. If construction has commenced is a factual question in which we have no direct knowledge, although we have been told construction did begin timely.

We hope this sufficiently answers your inquiry.

Sincerely yours,

RICHARD P. IEYOUB Attorney General

By: ______________________________ BARBARA B. RUTLEDGE Assistant Attorney General

BBR