In the agency’s second attempt to define Medicaid home- and community-based services (HCBS), the Centers for Medicare & Medicaid Services (CMS) proposed recently that assisted living units providing Alzheimer’s care could be considered institutional, thereby eliminating them from serving Medicaid beneficiaries.

The language was not what the National Center for Assisted Living (NCAL) wanted to hear.

“In essence, it says that certain settings are guilty of being institutions before being proven innocent,” Karl Polzer, senior director of policy for NCAL, said in response to the proposed rule. “It prejudges settings, including assisted living units in continuing care retirement communities, Alzheimer’s care communities, and multi-level campuses.”

CMS expects to issue further guidance on such settings.

In the meantime, the proposed rule states, “Settings that are located in a building that is also a public or privately operated facility that provides inpatient institutional treatment, or in a building on the grounds of, or immediately adjacent to, a public institution, or disability-specific housing complex” will be considered institutional, unless a state can prove otherwise.

Also eliciting concerns from NCAL was another CMS proposal to use landlord/tenant laws to apply to “provider-owned or -controlled residential” units or apartments. Most states have statutes and regulations for assisted living providers that specify move-in and move-out procedures as well as defining the level of care and conditions, NCAL said.

“General landlord tenant law and the use of leases are incompatible with assisted living regulatory standards in most states,” NCAL said.