Vested Interests Block Healthcare Deregulation and Choice

Governor Mead will soon start a laudable effort to study business regulations. Why laudable? According to the 2011 Utah Business Regulation Review, overregulation reduces entrepreneurship and productivity, which shrinks economic growth.

However, reducing the burden of business regulations will not be easy. The drawing of regulatory battle lines began during the past legislative session when the nursing home lobby killed a piece of legislation, SF135, which would have eased regulations at assisted living facilities.

In today’s political environment, regulations are often used to strengthen powerful and well-connected special interest groups at the expense of everyone else. This means those looking to unburden business from the heavy hand of government regulation could be in for a big fight with those all-too happy with the status quo.

In the 1990s, assisted living, a new type of living arrangement for people who could no longer live in their own homes but were still spry enough to stay out of the old-folks home, emerged. Like most businesses, assisted living facilities work under an eye-popping variety of government regulations.

SF135 would have loosened regulations on these facilities, allowing residents with certain minor health conditions to stay in a facility for longer if they wanted to, delaying the one-way trip to a more expensive and often less-appropriate nursing home.

After SF135 passed in the Senate, the nursing home advocacy group LeadingAge “led an effort that defeated the bill,” according to its 2013 Legislative Summary. Nursing home lobbyists said they were concerned “about the risks of relaxing those regulations” and mounted a concerted effort to lobby House representatives to kill the deregulation bill, and the House obliged.

Regulations SF135 would have relaxed restrictions currently preventing qualified people from treating open skin lesions without complications, providing catheter care and changing catheter collection bags, assisting patients with occasional bladder incontinency and caring for residents using oxygen supplementation.

But just how qualified does one have to be to change a BandAid? Furthermore, while still in high school, your author worked part-time in a nursing home and changed many a catheter bag. If a 17-year-old high school student can change a catheter bag, how complex could it be?

What drove the desire to loosen regulations? Nursing home living is far more expensive than other options.

According to Clear Senior Living, an organization that assists senior citizens by identifying appropriate and affordable living arrangements, the median assisted living annual rate in Cheyenne is $38,400. The median nursing home annual rate is $74,460.

Allowing people to stay longer in assisted living facilities means a delay in the trip to the nursing home. This would reduce the growth in demand for nursing home services, so it is no wonder the nursing home lobby jumped into action to stymie SF135. However, to keep care affordable and increase choice, legislators must jettison regulations whose main intention appears to be the maintenance of revenues for well-connected lobby groups. We are all losers when government makes winners of some at the expense of others.