Federal Housing Administration (FHA): Section 232 Healthcare Facility Insurance Program-Memory Care Residents
| Published date | 13 September 2019 |
| Citation | 84 FR 48321 |
| Record Number | 2019-19778 |
| Section | Proposed rules |
| Court | Housing And Urban Development Department |
Federal Register, Volume 84 Issue 178 (Friday, September 13, 2019)
[Federal Register Volume 84, Number 178 (Friday, September 13, 2019)]
[Proposed Rules]
[Pages 48321-48324]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2019-19778]
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DEPARTMENT OF HOUSING AND URBAN DEVELOPMENT
24 CFR Part 232
[Docket No. FR 6022-P-01]
RIN 2502-AJ46
Federal Housing Administration (FHA): Section 232 Healthcare
Facility Insurance Program--Memory Care Residents
AGENCY: Office of the Assistant Secretary for Housing, HUD.
ACTION: Proposed rule.
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SUMMARY: HUD's Section 232 program insures mortgage loans to facilitate
the construction, substantial rehabilitation, purchase, and refinancing
of nursing homes, intermediate care facilities, board and care homes,
and assisted-living facilities. Through this rule, HUD proposes changes
to update the requirements for the location of bathrooms in board and
care and assisted living facilities to allow providers to configure the
facilities to meet the needs of memory care residents and allow for
flexibility of the bathroom requirement when financing or refinancing
existing facilities.
DATES: Comment due date: November 12, 2019.
ADDRESSES: Interested persons are invited to submit comments regarding
this proposed rule. All submissions must refer to the above docket
number and title. There are two methods for submitting public comments.
1. Submission of Comments by Mail. Comments may be submitted by
mail to the Regulations Division, Office of General Counsel, Department
of Housing and Urban Development, 451 7th Street SW, Room 10276,
Washington, DC 20410-0500.
2. Electronic Submission of Comments. Interested persons may submit
comments electronically through the Federal eRulemaking Portal at
www.regulations.gov. HUD strongly encourages commenters to submit
comments electronically. Electronic submission of comments allows the
commenter maximum time to prepare and submit a comment, ensures timely
receipt by HUD, and enables HUD to make them immediately available to
the public. Comments submitted electronically through the
www.regulations.gov website can be viewed by other commenters and
interested members of the public. Commenters should follow the
instructions provided on that site to submit comments electronically.
Note: To receive consideration as public comments, comments must be
submitted through one of the two methods specified above. Again, all
submissions must refer to the docket number and title of the rule.
No Facsimile (FAX) Comments. FAX comments are not acceptable.
Public Inspection of Public Comments. HUD will make available all
properly submitted comments and communications for public inspection
and copying between 8 a.m. and 5 p.m. weekdays at the above address.
Due to security measures at the HUD Headquarters building, you must
schedule an appointment in advance to review the public comments by
calling the Regulations Division at 202-708-3055 (this is not a toll-
free number). Individuals with speech or hearing impairments may access
this number via TTY by calling the Federal Relay Service at 800-877-
8339. Copies of all comments submitted are available for inspection and
downloading at www.regulations.gov.
FOR FURTHER INFORMATION CONTACT: John M. Hartung, Director, Policy,
Risk Analysis & Lender Relations Division, Office of Residential Care
Facilities, Office of Healthcare Programs, Office of Housing,
Department of Housing and Urban Development, 1222 Spruce Street, St.
Louis, MO 63103-2836; telephone number 314-418-5238 (this is not a
toll-free number). Persons with hearing or speech impairments may
access this number through TTY by calling the toll-free Federal Relay
Service at 800-877-8339 (this is a toll-free number).
SUPPLEMENTARY INFORMATION:
I. Background
Under Section 232, 223(a)(7), and 223(f) of the National Housing
Act (12 U.S.C. 1715w, 12 U.S.C. 1715n(a)(7), and 12 U.S.C. 1715n(f)(4),
respectively), FHA insures mortgages to finance the purchase or
refinance of nursing homes, intermediate care facilities, board and
care homes, and assisted living facilities (collectively, residential
healthcare facilities). To meet the needs of residents living in the
Section 232 program facilities and those seeking to insure projects
under the Section 232 program, HUD proposes to revise the current
regulation at Sec. 232.7 regarding bathroom requirements to meet the
needs of memory care residents. Memory care residents are those
patients in assisted living or board and care settings that have
cognitive impairments, such as Alzheimer's disease and other dementias
who require care in a secure setting. HUD proposes the revision to add
flexibility for financing existing residential healthcare facilities.
A. Memory Care Residents
Residents of assisted living facilities need assistance with their
``activities of daily living'' (ADL). Activities of daily living
include, but are not limited to, such things as bathing, dressing,
eating, getting in or out of bed, using the toilet, preparing meals,
taking medications,
[[Page 48322]]
and performing light housework. Memory care residents' care is often
provided on a separate floor or wing to address the residents' specific
needs. The health and safety of persons with dementia and other
cognitive impairments can be enhanced by environments with features
designed to accommodate cognitive and physical impairments. For
example, Alzheimer residents' living environments have secured areas to
prevent wandering--a common symptom of the disease. Memory care
provides intensive, long-term medical care to seniors or others with
serious health and dementia conditions in a fully-staffed and monitored
facility.\1\
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\1\ Office of the Assistant Secretary for Planning and
Evaluation, ``Measuring The Activities of Daily Living: Comparison
Across National Surveys'' https://aspe.hhs.gov/basic-report/measuring-activities-daily-living-comparisons-across-national-surveys.
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The research shows the growing need for memory care specific
services. Based on estimates from the Aging, Demographics, and Memory
study of a nationally representative sample of older adults, 13.9% of
people aged 71 and over in the United States have Alzheimer's disease
or other types of dementia.\2\ A National Study of Long-Term Care
Providers (NSLTCP) found that a sizeable portion of long-term care
service users had a diagnosis of Alzheimer's disease or other
dementias--almost one-third of adult day services center participants
and home health patients, about four-tenths of residential care
residents, and almost one-half of nursing home residents. The National
Center for Assisted Living, a nonprofit entity within the American
Health Care Association specializing in assisted living, developed a
profile for the average resident of an assisted living facility \3\
which found the average resident of an assisted living facility to be
nearly 87 years old. Whereas, Section 232 of the National Housing Act
defines frail elderly to be individuals 62 years and older who are in
need of support for three ADLs. The data and research suggest that
Alzheimer's disease or other dementias is a common precipitating factor
for using formal long-term care services.\4\
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\2\ Long-Term Care Services in the United States: 2013 Overview
Vital and Heath Statistics, Series 2, no 37, Center for Disease
Control and Prevention, National Center for Health Statistics, U.S.
Department of Health and Human Services p.39 (citing Plassman BL, et
al., Prevalence of Dementia in the United States: The aging,
demographics, and memory study. Neuroepidemiology 29(1-2):125-32.
2007).
\3\ Overview of Assisted Living, published by the American
Association of Homes and Services for the Aging, American Seniors
Housing Association, Assisted Living Federation of American,
National Center for Assisted Living, and National Investment Center
for the Seniors Housing & Care Industry (2009).
Overview of Assisted Living, published by the American
Association of Homes and Services for the Aging, American Seniors
Housing Association, Assisted Living Federation of American,
National Center for Assisted Living, and National Investment Center
for the Seniors Housing & Care Industry (2009). Assisted Living
Regulations and Policy: 2015 Edition 06/15/2015, Office of The
Assistant Secretary for Planning and Evaluation, U.S. Department of
Health & Human Services, https://aspe.hhs.gov/basic-report/compendium-residential-care-and-assisted-living-regulations-and-policy-2015-edition.
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B. State Regulation of Memory Care Facilities Bathing Arrangements
Although many Federal laws affect assisted living, oversight
generally occurs at the state level through state licensure, statutes,
and standards. Federal regulations issued by the Centers for Medicare
and Medicaid Services (CMS) for long-term care facilities simply
require that each resident room must be equipped with or located near
toilet and bathing facilities.\5\ State regulation is often much more
precise, specifying minimum standards for toilet and bathing facilities
locations and ratios. Thirty-five states have provisions for the
physical features of dementia care units, including the residents'
living units, access to bathrooms, and external locking doors or
controlled methods of egress to prevent unsafe exits.\6\ It is
important to also note that Federal civil rights laws and regulations
also contain accessibility and nondiscrimination requirements that
apply, including the Fair Housing Act (24 CFR part 100), the Americans
with Disabilities Act (28 CFR parts 35 (Title II) and 36 (Title III)),
and Section 504 of the Rehabilitation Act (24 CFR part 8), as
applicable.
II. This Proposed Rule
HUD's Section 232 regulation at Sec. 232.7 requires a specific
number of bathrooms per residents and specifies the physical
configuration of a board and care home or an assisted living facility.
This regulation has not been updated in any substantial manner in over
20 years.
HUD is proposing to revise the regulations that govern the number
and location of bathrooms in board and care homes and assisted living
facilities currently insured or to be insured under the Section 232
program. The revisions would allow providers to configure existing
facilities to meet the needs of residents, such as frail elderly
individuals who have Alzheimer's disease or related dementia, and who
need specialized support, such as assistance with bathing. This
revision will allow the financing of existing residential healthcare
facilities that do not meet HUD's existing bathroom standards, but
which are currently providing necessary care to residents with
Alzheimer's disease or related dementia.
This proposed rule would not be applicable to substantial rehab and
new construction. A substantially rehabilitated or new facility would
be constructed in a manner which allows it to provide services for
assisted living residents and memory care residents and meet HUD's
long-standing standards set forth in Sec. 232.7.
A. Configuration of Section 232 Insured Facilities To Meet Memory Care
Residents' Needs
Subpart A of part 232 codified regulations entitled ``Eligibility
Requirements,'' contains requirements for the number of bathrooms per
residents and access to those bathrooms for board and care homes and
assisted living facilities in Sec. 232.7. Specifically, the
regulations provide that not less than one full bathroom must be
provided for every four residents of a board and care home or assisted
living facility, and bathroom access from any bedroom or sleeping area
must not pass through a public corridor or area.
Generally, owners of assisted living facilities that apply for FHA
mortgage insurance meet the requirements of Sec. 232.7, because those
assisted living facilities serve seniors who seek an independent
lifestyle and do not require the higher level of monitoring provided to
memory care residents. Rather, these residents simply need assistance
to meet ADLs. However, several facilities were unsuccessful when they
sought HUD's assistance in refinancing their debt because they could
not satisfy the bathroom requirements set forth in HUD's regulations,
and several applicants have advised that the requirement regarding the
number and location of bathrooms set forth in Sec. 232.7 presented
barriers to properly serving memory care residents, who need
specialized support, including assistance with bathing. Accordingly,
some owners seeking Section 232 financing sought and received waivers
from the current requirements in Sec. 232.7 to allow bathroom facility
configurations that were better suited to meet the care of memory care
residents. Over time, HUD realized that the current regulations are
outdated and in need of revision.
B. Proposed Changes
HUD's current prohibition on designs that allow residents to
``[pass] through
[[Page 48323]]
public areas'' to a bathroom precludes insurance of existing facilities
that meet the needs of memory care residents requiring assistance in
bathing, and at which the physical redesign of the facility would be
infeasible. Consequently, to provide flexibility in accepting the
existing design of bedrooms and bathrooms to meet the greater care
required for memory care residents, HUD proposes to revise Sec. 232.7
to provide exceptions. Excepted facilities must still comply with any
applicable State or local standards and requirements, including
requirements specific to memory care facilities. See Sec. 232.2. State
or local standards that are more stringent than these requirements
would not be preempted by this rule.
Exemption for Facilities Insured Under Section 223(f) or 223(a)(7)
The exemption would apply to memory care facilities whose financing
is being insured pursuant to Section 223(f) or 223(a)(7) of the
National Housing Act, only when four considerations are satisfied: (1)
Memory care residents must reside in a separate secured locked area of
the board and care home or assisted living facility; (2) any bathroom
access from a memory care resident's bedroom or sleeping area that
passes through a public corridor or area must be in that separate,
secured, and locked area of the board and care home or assisted living
facility; (3) memory care residents of such areas require full
assistance or supervision when bathing; and (4) wards serving memory
care residents have no more than two beds per unit and a half-bath in
each unit. Note that the codified rule prohibits bathroom access from a
public area, and this section provides limited conditions under which
access from public areas is allowable.
This exemption would not apply to new construction or substantial
rehabilitation insured under Section 232, and those projects must
continue to follow the long-standing bathroom requirements for board
and care home or assisted living units.
III. Findings and Certifications
Regulatory Review--Executive Orders 12866 and 13563
Under Executive Order 12866 (Regulatory Planning and Review), a
determination must be made by the Office of Management and Budget
regarding whether a regulatory action is significant and therefore
subject to review in accordance with the requirements of the order.
Executive Order 13563 (Improving Regulations and Regulatory Review)
directs executive agencies to analyze regulations that are ``outmoded,
ineffective, insufficient, or excessively burdensome, and to modify,
streamline, expand, or repeal them in accordance with what has been
learned.'' Executive Order 13563 also directs that, where relevant,
feasible, and consistent with regulatory objectives, and to the extent
permitted by law, agencies are to identify and consider regulatory
approaches that reduce burdens and maintain flexibility and freedom of
choice for the public. This rule allows additional flexibility for the
financing of residential healthcare facilities.
Executive Order 13771
Executive Order 13771, entitled ``Reducing Regulation and
Controlling Regulatory Costs,'' was issued on January 30, 2017. This
proposed rule is expected to be an Executive Order 13771 deregulatory
action by providing additional flexibility for healthcare facilities,
as discussed above.
Environmental Review
A Finding of No Significant Impact (FONSI) with respect to the
environment has been made in accordance with HUD regulations at 24 CFR
part 50, which implement Section 102(2)(C) of the National
Environmental Policy Act of 1969 (42 U.S.C. 4332(2)(C)). The FONSI is
available for public inspection between the hours of 8 a.m. and 5 p.m.
weekdays in the Regulations Division, Office of General Counsel,
Department of Housing and Urban Development, 451 7th Street SW, Room
10276, Washington, DC, 20410-0500. Due to security measures at the HUD
Headquarters building, please schedule an appointment to review the
FONSI by calling the Regulations Division at 202-708-3055 (this is not
a toll-free number). Individuals with speech or hearing impairments may
access this number via TTY by calling the Federal Relay Service at 800-
877-8339.
Unfunded Mandates Reform Act
The Unfunded Mandates Reform Act of 1995 (UMRA) (2 U.S.C. 1531-
1538) establishes requirements for Federal agencies to assess the
effects of their regulatory actions on state, local, and tribal
governments and on the private sector. This proposed rule does not
impose any Federal mandate on any state, local, or tribal government,
or on the private sector, within the meaning of UMRA.
Regulatory Flexibility Act
The Regulatory Flexibility Act (RFA) (5 U.S.C. 601 et seq.)
generally requires an agency to conduct a regulatory flexibility
analysis of any rule subject to notice and comment rulemaking
requirements, unless the agency certifies that the rule will not have a
significant economic impact on a substantial number of small entities.
HUD believes that this proposed rule imposes no additional
requirements on small businesses. Currently, HUD has a total of 3,673
residential healthcare facilities in its portfolio and completes
approximately 300 firm commitments each year for 223(f) and 223(a)(7)
refinances. HUD is providing waivers on 3 percent of those applications
and waiver requests continue to increase. As noted in the preamble of
the proposed rule, applicants have advised that the requirement
regarding the number and location of bathrooms presented barriers to
properly serving memory care residents, who need specialize support.
HUD believes this proposed rule will resolve the inadequacy of the
current bathroom requirements, thus, easing the existing burden on
those entities seeking to accommodate memory care residents and
entities seeking to finance or refinance facilities. Additionally, both
owners, small and large, and memory care residents will benefit from
the opportunity to finance their facility in compliance with this new
framework.
Accordingly, the undersigned certifies that this proposed rule will
not have a significant economic impact on a substantial number of small
entities. Notwithstanding HUD's determination that this rule will not
have a significant effect on a substantial number of small entities,
HUD specifically invites comments regarding any less burdensome
alternatives to this rule that will meet HUD's objectives as described
in the preamble to this rule.
Executive Order 13132, Federalism
Executive Order 13132 (entitled ``Federalism'') prohibits to the
extent practicable and permitted by law, an agency from publishing any
rule that has federalism implications if the rule either imposes
substantial direct compliance costs on state and local governments and
is not required by statute, or preempts state law, unless the relevant
requirements of Section 6 of the Executive Order are met. This rule
does not have federalism implications and does not impose substantial
direct compliance costs on state and local governments or preempt state
law within the meaning of the Executive Order.
[[Page 48324]]
Catalogue of Federal Domestic Assistance
The Catalogue of Federal Domestic Assistance Number for the
Mortgage Insurance Nursing Homes, Intermediate Care Facilities, Board
and Care Homes and Assisted Living Facilities is 14.129.
List of Subjects in 24 CFR Part 232
Fire prevention, Health facilities, Loan programs-health, Loan
programs-housing and community development, Mortgage insurance, Nursing
homes, Reporting and recordkeeping requirements.
Accordingly, for the reasons stated above, HUD proposes to amend 24
CFR part 232 as follows:
PART 232--MORTGAGE INSURANCE FOR NURSING HOMES, INTERMEDIATE CARE
FACILITIES, BOARD AND CARE HOMES, AND ASSISTED LIVING FACILITIES
0
1. The authority citation for part 232 continues to read as follows:
Authority: 12 U.S.C. 1715b; 1715w; 1735d, and 1735f-19; 42
U.S.C. 3535(d).
Subpart A--Eligibility Requirements
0
2. Revise Sec. 232.7 to read as follows:
Sec. 232.7 Bathroom.
(a) General requirement. For a board and care home or assisted
living facility to be eligible for insurance under this part:
(1) The board and care home or assisted living facility must have
no less than one full bathroom provided for every four residents; and
(2) Bathroom access from any bedroom or sleeping area must not pass
through a public corridor or area.
(b) Exemption for existing projects providing memory care. The
following applies to a board and care home or assisted living facility
that provides housing for residents in need of memory care, i.e., care
for residents who have cognitive impairments, such as Alzheimer's
disease or other dementias:
(1) Subject to paragraph (b)(2) of this section, a project seeking
insurance under subpart E, pursuant to Section 223(f) or 223(a)(7) of
the National Housing Act, may be eligible for insurance without meeting
the general requirement in paragraph (a) of this section, if the
project meets the following four requirements:
(i) Memory care residents are in a separate, secured, and locked
area of the board and care home or assisted living facility;
(ii) Any bathroom access from a memory care resident's bedroom or
sleeping area that passes through a public corridor or area is in a
separate, secured, and locked area of the board and care home or
assisted living facility prescribed in paragraph (b)(1)(i) of this
section;
(iii) Memory care residents receive full assistance or supervision
while bathing; and
(iv) Memory care residents reside in wards that contain no more
than two beds per unit and have a half-bath in each unit.
(2) If a facility serving memory care residents also serves
residents who are not in a separate, secured, and locked area of the
board and care home or assisted living facility, this exemption applies
only to the separate, secured, and locked area in which solely memory
care residents reside.
Dated: August 9, 2019.
John L. Garvin,
General Deputy Assistant Secretary for Housing.
[FR Doc. 2019-19778 Filed 9-12-19; 8:45 am]
BILLING CODE 4210-67-P
