Committee rejects repeal of nursing‑home certificate of need after split testimony on rural impact
January 22, 2025 | Labor, Health & Social Services Committee, Senate, Committees, Legislative, Wyoming
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The Labor, Health & Social Services Committee voted 3‑2 against advancing legislation to repeal Wyoming’s certificate‑of‑need rules for nursing‑home construction and bed expansion, closing a contentious debate over rural access, staffing and payment incentives.
Senate File 89 (presented by Senator Gary Crum) would remove several statutory restrictions, including the 85% occupancy threshold that now limits new nursing‑home construction in a defined geographic radius and the 10% cap on incremental bed expansion. Proponents told the committee the move would allow new builders and non‑profit operators to invest in modern long‑term‑care facilities and increase local capacity; opponents warned it could destabilize small hospitals and existing nursing homes that rely on Medicaid and swing‑bed revenue.
Senator Crum said the statute limits the market and helps perpetuate older buildings that do not meet modern design or accessibility standards. “Competition will make us all better,” he said in summary remarks, arguing repeal would permit new construction and facility upgrades in places where patients currently travel out of state for care.
The Wyoming Department of Health described how the certificate‑of‑need process is implemented. Director Stefan Johansen and Laura Hudspeth, administrator of the Office of Healthcare Licensing and Survey, told senators the department receives and evaluates requests for new construction and expansion under the current statute. Since 2009 the department said it received 18 requests for new nursing‑facility construction, approved 11 and denied 7; two recent expansion requests were approved but only one project moved forward.
Opponents included nursing‑home operators, hospital groups and some rural hospital leaders. Eric Bowley of the Wyoming Hospital Association and LeadingAge Wyoming warned repeal could produce a “two‑tier” result: new facilities that take higher‑paying Medicare and private‑pay post‑acute patients while leaving older facilities with a disproportionate share of Medicaid residents and lower margins. He said that dynamic can erode quality in older homes and imperil facilities that cannot raise rates or attract private‑pay patients.
Hospital and rural leaders said competition for a thin statewide workforce is already acute. Eric Connell, chief executive officer of North Bighorn Hospital District, told the committee that new entrants would compete for the same limited staff and could cause closures in mission‑driven rural hospitals that depend on swing beds to remain financially viable. “If someone comes in and plops down a post‑acute, real nice building, you will devastate us,” he said.
Several operators urged a slower approach. Carolyn Passano of the Wyoming Healthcare Association asked the committee to delay major statutory change until federal guidance and workforce trends are clearer; Rocky Mountain Care’s administrator said her facility is 75% Medicaid and 75% occupied and warned a post‑acute entrant could “obliterate” that margin. Empress Healthcare's regional vice president said the state's average occupancy is about 67% and warned repeal could increase costs through price competition for staff and agency labor.
Supporters from business and policy groups called for the repeal on market grounds. Tyler Lindholm with Americans for Prosperity and Chris Mickey of the Wyoming Business Alliance said freeing market entry would encourage investment and more local options for families.
After final debate, the committee voted: Senator Crum — Aye; Senator Hutchings — No; Senator Scott — No; Senator Steinmetz — Aye; Chairman Barlow — No. The committee tally was 2 in favor, 3 opposed; the sponsor’s motion to advance the bill failed and the measure will not go to the floor from this committee.
Committee members asked industry groups and the department for more information about differential reimbursement (Medicaid vs. Medicare), staffing impacts and possible alternatives to a full repeal, including targeted statutory changes to the certificate‑of‑need rules or interim study to craft quality safeguards and reimbursement fixes.
Senate File 89 (presented by Senator Gary Crum) would remove several statutory restrictions, including the 85% occupancy threshold that now limits new nursing‑home construction in a defined geographic radius and the 10% cap on incremental bed expansion. Proponents told the committee the move would allow new builders and non‑profit operators to invest in modern long‑term‑care facilities and increase local capacity; opponents warned it could destabilize small hospitals and existing nursing homes that rely on Medicaid and swing‑bed revenue.
Senator Crum said the statute limits the market and helps perpetuate older buildings that do not meet modern design or accessibility standards. “Competition will make us all better,” he said in summary remarks, arguing repeal would permit new construction and facility upgrades in places where patients currently travel out of state for care.
The Wyoming Department of Health described how the certificate‑of‑need process is implemented. Director Stefan Johansen and Laura Hudspeth, administrator of the Office of Healthcare Licensing and Survey, told senators the department receives and evaluates requests for new construction and expansion under the current statute. Since 2009 the department said it received 18 requests for new nursing‑facility construction, approved 11 and denied 7; two recent expansion requests were approved but only one project moved forward.
Opponents included nursing‑home operators, hospital groups and some rural hospital leaders. Eric Bowley of the Wyoming Hospital Association and LeadingAge Wyoming warned repeal could produce a “two‑tier” result: new facilities that take higher‑paying Medicare and private‑pay post‑acute patients while leaving older facilities with a disproportionate share of Medicaid residents and lower margins. He said that dynamic can erode quality in older homes and imperil facilities that cannot raise rates or attract private‑pay patients.
Hospital and rural leaders said competition for a thin statewide workforce is already acute. Eric Connell, chief executive officer of North Bighorn Hospital District, told the committee that new entrants would compete for the same limited staff and could cause closures in mission‑driven rural hospitals that depend on swing beds to remain financially viable. “If someone comes in and plops down a post‑acute, real nice building, you will devastate us,” he said.
Several operators urged a slower approach. Carolyn Passano of the Wyoming Healthcare Association asked the committee to delay major statutory change until federal guidance and workforce trends are clearer; Rocky Mountain Care’s administrator said her facility is 75% Medicaid and 75% occupied and warned a post‑acute entrant could “obliterate” that margin. Empress Healthcare's regional vice president said the state's average occupancy is about 67% and warned repeal could increase costs through price competition for staff and agency labor.
Supporters from business and policy groups called for the repeal on market grounds. Tyler Lindholm with Americans for Prosperity and Chris Mickey of the Wyoming Business Alliance said freeing market entry would encourage investment and more local options for families.
After final debate, the committee voted: Senator Crum — Aye; Senator Hutchings — No; Senator Scott — No; Senator Steinmetz — Aye; Chairman Barlow — No. The committee tally was 2 in favor, 3 opposed; the sponsor’s motion to advance the bill failed and the measure will not go to the floor from this committee.
Committee members asked industry groups and the department for more information about differential reimbursement (Medicaid vs. Medicare), staffing impacts and possible alternatives to a full repeal, including targeted statutory changes to the certificate‑of‑need rules or interim study to craft quality safeguards and reimbursement fixes.
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