It's only a five-minute drive from the Kansas City, Missouri, side of State Line Drive to the fast growing suburb of Mission on the Kansas side of the Drive. But for seniors who can no longer care for themselves in their own homes, Kansas and Missouri might as well be worlds apart.

That's because Kansas enacted new regulations in 1997 that were designed to spur the construction of assisted-living facilities. Developers responded by building properties such as Sweet Life at Mission Springs, a 92-unit apartment building where seniors have both their own private apartments and access to a broad range of personal and medical services, including help in getting dressed or in taking medications. The goal of assisted-living facilities such as Sweet Life is to allow residents to age in place in their own private apartments by providing them with the backup they need as they become increasingly frail and infirm.

Missouri law, however, tightly restricts the services that can be provided in senior-living facilities. The result is that all of the development of assisted-living facilities in the Kansas City area has taken place in Johnson County on the Kansas side of the Drive's divide. "None have opened in Missouri, and none will until they change their regulations," says Mark Parkinson, one of the owners of Sweet Life.

What's happening in Missouri and Kansas is being played out across the country as states differ in their response to the housing and health needs of an aging population. While a variety of non- institutional options are being developed, none of those currently available has gathered more momentum or is garnering more attention than assisted living. With its ability to offer physical protection along with personal privacy and independence, assisted living is fast becoming the arrangement of choice for the frail elderly. That's why a growing number of states are, like Kansas, assisting the private development of such properties by resisting a strong regulatory role. But other states are more like Missouri. With the memory of over-the- top growth of nursing home capacity--and the fear of exposing the vulnerable elderly to the kinds of abuses that can occur in an unregulated setting--they want to keep a strong and preventive hand on the senior-services tiller.

But as many states are learning, the regulatory decision is more complicated than that. The role of the state in protecting the elderly raises the question of how much oversight is appropriate for facilities whose very purpose is to provide residents with as much freedom and privacy as possible. At the same time, many independent seniors, as they age into frailty, lose the ability to make reasonable decisions and guide their own care. There's often no clear line between a reasonable risk and an unreasonable one. Is an 85-year-old who needs help getting into a bathtub but insists on bathing herself taking dangerous risks or exercising her right to privacy?

"It's a constant yin-yang between independence, control and choice, which are very important values, and protection when someone is too vulnerable and can't ask for help," says Virginia Dize, the director of the Center for the Advancement of State Community Services Programs. "Creating a regulatory structure that can respond to those two ends of the continuum is very difficult."

The difficulties are compounded by the much-regulated nursing home industry, which has been lobbying hard to keep a level playing field between it and its competition. Nursing home operators consider it unfair for assisted living not to be answerable to the same rules.

In response to these countervailing pressures, 17 states recently revised their assisted-living regulations, and 25 are currently drafting, revising or studying them. The overall regulatory trend, according to Robert Mollica, deputy director of the National Academy of State Health Policy, is to "offer flexibility to accommodate aging in place." That means helping elderly people remain in a home setting by bringing health and personal services to those with higher levels of impairment and health problems.

With greater flexibility have come problems. As the number of frail seniors residing in assisted-living facilities has increased--the number of assisted-living beds has more than doubled in the past decade, while skilled-nursing beds have increased by less than a fifth--quality concerns have come to the fore. A 1999 U.S. General Accounting Office report that examined assisted living in four states (California, Florida, Ohio and Oregon) found that more than a quarter of the facilities had been cited by state oversight agencies or ombudsmen for five or more "quality of care or consumer protection related deficiencies or violations" over the course of the preceding year. The GAO also found that providers did not always give consumers enough information to determine whether a facility could meet their needs and for how long.

Some state legislators and regulators point to findings such as these and see a need for robust guidelines and rules. They view the unconstrained growth of the assisted-living industry with concern and want to control the supply of assisted-living facilities using regulatory tools, such as certificates of need. Others, however, are not only encouraging an assisted-living boom but hope to expand access to lower-income seniors. Officials in these states believe that competition for residents will be the primary force in maintaining a high quality of care.

It is, in short, a situation in flux, and which way will predominate is still very much up in the air. "It's very different from what we've done up to now," says Dize. "We've all been concerned about protecting vulnerable people, but now the elderly are telling us, `We don't want you to protect us; we want to tell you how to help us.'"

The trigger point for state regulatory attention tends to be growth-- either the fear or the reality of it. The reaction has been to link supply to demand by imposing certificates of need on assisted-living development.

This approach lumps assisted living in with nursing homes. In most states, nursing home operators must apply for such certificates and prove that nursing home facilities in a given area are fully utilized before opening new beds. The certificate of need process has given states a way to control overbuilding of nursing homes--and to control costs. The latter is significant since keeping nursing home tabs low helps states control the rate of payment for Medicaid patients in nursing homes.

Assisted-living facilities, however, receive very little state money, so most states have not imposed certificates of need on them. However, nine states--among them Arkansas, Georgia, New Jersey and Missouri-- do, and other states are increasingly interested in the idea.

Alabama is one of them. There, an assisted-living industry has developed with virtually no state oversight. The state currently has only three inspectors to oversee some 8,000 licensed assisted-living units, many of which are caring for residents with dementia or Alzheimer's disease. Another 4,000 licensed assisted-living units are on the drawing boards.

In November, Alabama promulgated new regulations for the assisted- living industry that created a new "intermediate" level designation for facilities that plan to care for patients with dementia-related problems. The current administration has strongly supported subjecting these facilities to a certificate of need process. "We don't want to end up with a situation where we have an overbuilt, underutilized industry struggling to provide adequate care," says Don Williamson, the state health officer.

The assisted-living industry hardly agrees. In fact, they see an inverse relationship between controlling supply and keeping up quality. "When certificates of need control the supply and the demand is greater, that means that facilities have no incentive to improve quality," says Tommy McDougal, president of the Assisted Living Association of Alabama. "They know they're going to get the next person on the waiting list."

Most observers agree with this assessment. Don Redfoot, senior policy adviser with AARP's Public Policy Institute, notes that, from a consumer perspective, there can't be too much growth since excess supply leads to more competition, which is good for the consumer. "In places where they've constricted supply, you see not just higher costs but lower quality," he says, adding that the effort to curb supply "is generally advocated by those who want to protect their market share, pure and simple."

Often, that's the nursing home industry. Yet it and other critics of unconstrained growth have thoughtful and unexpected allies, such as the state of Oregon.

No state has done more to encourage the growth of assisted-living facilities than Oregon. It was the first state to receive a federal waiver to use Medicaid funds for long-term care outside of nursing homes and has developed a range of long-term care options, from in- home care to assisted living, as well as a system to help seniors choose the type of care most appropriate for their condition.

Yet it is here that the boom in assisted living has some state officials concerned. With overbuilding, says Dan Kaplan, deputy administrator of Oregon's Senior and Disabled Services Division, "either you create extraordinarily high costs because essentially you're supporting a lot of unnecessary capacity or you don't do that and the facilities become financially unstable." The latter is what's happened with nursing homes in his state, and he is concerned that assisted-living facilities could get to that point in a relatively short time.

Rather than use the certificate of need process to dampen supply, however, Oregon officials are currently looking for other ways to encourage more rational development. One approach is for the state to be a clearinghouse of information to let developers know who's thinking about doing what. "We can make it the case that developers need to do more of the development process in public," Kaplan says.

More robust measures are also under consideration. State officials have opened discussions with the industry about setting up a full-bore planning process that looks at the long-term care system as a whole. And that, Kaplan says, "may result in a regulatory structure that regulates capacity more fully than what we have now."

Meanwhile, several other states that have experienced growth in assisted-living facilities are looking for ways to regulate the quality of care. While almost every state requires assisted-living facilities to provide tenants with a description of the services the facility provides, a growing number of states are now asking assisted- living facilities and new residents to sign tenant-service agreements that specify how facilities will provide specific services to specific seniors.

In Washington State, caseworkers help residents negotiate service plans with assisted-living facilities. In keeping with the assisted- living philosophy, residents are free to take risks in their personalized program. If a resident insists on bathing herself despite the risk of injury, the assisted-living facility will attempt to develop ways to manage that risk. Once an agreement has been reached, the resident, family members, caseworker and facility staff sign a document that formalizes the agreement. "It's not a professional staff person coming to you and saying, `Here's how we're going to do this.' The plan is truly negotiated," says Dennis McKee, a program manager with the state's Division of Aging and Adult Services.

The program, however, applies only to a small subset of assisted- living facilities--those that have contracted with the state to serve residents eligible for Medicaid funds through a special federal waiver. Seniors in other assisted-living facilities are covered by a long-term-care residents' rights statute that requires facilities to "reasonably accommodate" residents' needs. Seventeen other states offer similar statutory protection. But McKee acknowledges that Washington's residents' rights law does little to discourage deceptive advertising. That remains a problem since the term "assisted living" lends itself to some rather loose definitions. In Washington, a lot of boarding homes advertise themselves as assisted living, as do adult family homes--even home health agencies. "There's nothing to stop me from starting a lawn mowing service," McKee says, "and calling it an assisted-living service."

In Iowa, the Department of Elder Affairs is working to keep tabs on quality of care by going directly to the consumer. Under a pilot program, residents in facilities up for recertification are surveyed by a polling firm about their expectations going into the facility and the extent to which those expectations are being met. When staff from Elder Affairs conducts an inspection, they bring the results of the surveys with them so that they can explore problems in a given facility and discuss possible solutions with facility administrators.

A handful of states require assisted-living facilities to develop quality-assurance programs. In Connecticut, for instance, assisted- living-services agencies must establish quality-assurance committees that consist of a physician, a registered nurse and a social worker. These committees meet every four months to review agency policies and conduct regular inspections.

In the short term, most state approaches to assisted living will probably look a lot like present-day Oregon's. In the longer term, however, what Oregon's regulations will look like remains an open question.

"It's going to take us a while to figure it out," says Virginia Dize. "Let's face it, we haven't quite figured out the nursing home end, and we've had a lot more years of experience trying."