Gibbons called ‘fiscally irresponsible’ after he yanks fee plan

Friday, March 2, 2007 | 7:09 a.m.

CARSON CITY - Adhering to his campaign promise not to raise taxes or fees, Gov. Jim Gibbons has withdrawn a budget plan that would have charged hospitals, restaurants and other businesses nearly $7 million more to offset the state's cost of regulating them.

Assemblywoman Sheila Leslie, chairwoman of a Senate-Assembly budget committee dealing with health agencies, criticized Gibbons' move as a "fiscally irresponsible" one that marks a departure from the long tradition of charging industries for their regulation.

"I don't think this will be acceptable to the Legislature," she said. The governor's plan - under which some of the proposed higher fees would be replaced by taxpayer money - is going to "cause havoc" and could lessen public safeguards, she warned.

Gibbons' budget, largely inherited from former Gov. Kenny Guinn, would have permitted the Nevada Health Division to hire more than 20 employees, mainly for inspections.

Hospital and nursing home representatives complained to a legislative committee last week that the fees charged by the health division already are among the nation's highest.

The budget also called for the Nevada Bureau of Licensing and Certification to hire more than 10 staffers to license and inspect hospitals, nursing homes, group homes, medical laboratories and transitional living facilities. To do so, it recommended raising fees to those businesses by $4.2 million over the next two years.

Gibbons, though, has decided to not raise fees and not hire extra staff, state Human Resources Director Mike Willden said.

That will compel the health division to set regulatory priorities, led by investigations into safety complaints, he said. Not expanding the inspection staff also could delay the licensing or recertification of hospitals and nursing homes, Willden said.

Not surprisingly, hospitals and nursing homes wanted the state to put general taxpayer money into the licensing bureau rather than raising their fees.

Gibbons' decision "is not going to make people very happy," said Charles Perry, executive director of the Nevada Health Care Association. "It goes to show you can't please all the people all the time."

Bill Welch, executive director of the Nevada Hospital Association, said he did not anticipate delays in the licensing and certification of new hospitals because checks during construction help minimize problems. But he conceded that reviews of existing hospitals could be slowed.

Hospitals now pay $1 million to $1.2 million a year in fees to finance state inspections, including $10,000 plus $60 per bed upon opening and annual fees of $5,000 and $30 per bed. Those rates are the nation's third highest, Welch said.

Nursing homes' annual fees are $1,100 and $30 per bed. The proposed increase could have cost them and other businesses up to $1,500 per year, with the price varying based on the company's size.

The state's consumer health protection unit also wants $1.3 million to hire five more inspectors to check for health safety in restaurants, septic systems, swimming pools, school cafeterias and at special events. To do that without raising fees, Gibbons plans to use general fund money.

The governor is following the same plan of using general fund money for the radiological health unit, which sought to raise fees by $1.1 million over the next two fiscal years.

The unit wants to hire five extra inspectors to check for health hazards from radiation. It inspects X-ray and mammography machines, oversees the Energy Department at the Nevada Test Site and inspects the closed low-level waste dump near Beatty.

The state's cancer registry also sought $230,000 over the next two years in higher fees from hospitals and pathology labs to offset record-keeping expenses. To avoid higher fees for that, state officials plan to pursue cost-cutting steps.

Although the state now charges $32 per case to gather information for the registry, hospitals and labs can do the same work for $8. Accordingly, Willden said a bill may be introduced to require businesses to compile the information and submit it to the state.