The Senate Health and Human Services Committee on Friday defeated a bill that would have allowed for the redistribution of unused nursing facility bed capacity.

SDAHO, the state Department of Health (DOH), the South Dakota Healthcare Association and Avera Health testified against Senate Bill 5, which emerged from the summer Interim Committee on Regulation of Nursing and Assisted Living Beds.

Sen. Alan Solano, R-Rapid City, the bill’s sponsor who served on the interim committee, said the bill would sweep unused beds into the pool and allow and empower DOH to redistribute them through its request for proposals (RFP) process. Solano said there is a demand for unused beds in populated parts of the state such as Rapid City and Sioux Falls.

But Health Secretary Kim Malsam-Rysdon said the bill was unnecessary and there are multiple valid reasons in which a nursing facility could have unused beds. Those include a lack of staffing, consumer demands for private rooms and complex care needs that exceed the services of the facility. And because Medicaid rates are tied to the number of nursing beds, facilities have to be careful to only license the beds they are confident will remain in use, she said.

Malsam-Rysdon said she appreciates the interim committee’s work and the intent of the bill, but the department has 150 beds available and intends to issue an RFP this spring to redistribute those beds.

South Dakota has 110 licensed nursing homes with 6,855 licensed beds. The state’s moratorium number is 8,039 beds, leaving nearly 1,200 beds not licensed.

The bill would have required a nursing facility to use any of its unused bed capacity before July 1, 2018. The facility’s unused bed capacity would then have reverted to the South Dakota Department of Health and be retained in the unlicensed moratorium bed population for the future needs of the state.

The committee on Friday voted 6-1 to defer Senate Bill 5 to the 41st legislative day, which is a procedural move to kill legislation.