In advance of the President’s State of the Union address, the White House released a Fact Sheet yesterday entitled Protecting Seniors and People with Disabilities by Improving Safety and Quality of Care in the Nation’s Nursing Homes. The Fact Sheet is intended to summarize the Administration’s reform efforts, developed by and implemented through the U.S. Dept. of Health and Human Services (HHS) to improve the safety and quality of nursing home care nationally. These Federal reforms could have significant consequences for the nursing home industry if implemented.
The following summarizes some of these key proposed reforms and means by which the Administration and HHS intends to implement them. As indicated below, many initiatives will be implemented by CMS with existing authority, either through rulemaking or directly, if no rule is required. Other proposals will require Congressional action for increased funding or new CMS authority to be granted:
Establish a Federal Minimum Nursing Home Staffing Requirement – CMS to conduct a new research study to determine the adequate level and type of staffing at SNFs and expects to issue a proposed rule within a year.
Reduce SNF Resident Room Crowding – CMS will explore ways to accelerate phasing out patient rooms with three or more residents and will promote single occupancy rooms.
Strengthen the Skilled Nursing Facility (“SNF”) Value-Based Purchasing (“VBP”) Program – CMS intends to propose new payment revisions based on staffing adequacy, resident experiences, and how well facilities retain staff.
Reinforce Safeguards against Unnecessary Medications and Treatments – CMS will launch a new effort to identify problem diagnoses and refocus efforts to lower the inappropriate use of antipsychotic medications.
Adequately Fund Inspection Activities – The President will call on Congress to provide almost $500 million to CMS to support health and safety inspections at nursing homes.
Beef up Scrutiny on More of the Poorest Performers – CMS’s Special Focus Facility (SFF) program to be overhauled to scrutinize more facilities at a quicker pace; failing facilities will face increasingly larger enforcement actions, including possible termination from Medicare and Medicaid.
Expand Financial Penalties and Other Enforcement Sanctions – CMS will increase enforcement actions based on desk reviews in addition to on-site inspections. In reversing a previous administration change to lower penalty amounts to a one time fine, CMS now intends to make per-day fines the default penalty for non-compliance. The President will also ask Congress to raise the dollar limit on per-instance financial penalties levied on poor-performing facilities from $21,000 to one million dollars.
Increase Accountability for Chain Owners of Substandard Facilities – The President will ask Congress to: a) grant CMS new authority to require “minimum corporate competency” to participate in Medicare and Medicaid; i.e., enabling CMS to ban individuals and entities based on Medicare compliance history of other previous or existing owned or operated facilities; and b) expand CMS authority at the ownership level, which would enable CMS to impose enforcement action on owners and operators even after a facility closes, or against owners/operators that provide poor care in some homes while owning/operating others.
Improve Transparency of Facility Ownership and Finances – CMS will implement ACA requirements regarding transparency in corporate ownership by collecting and publicly reporting “more robust” corporate ownership and operating data, which will be available on Nursing Home Compare that will be enhanced to indicate additional measures such as the new minimum staffing requirement to be implemented, and rating will be based more on verifiable data rather than self-reported data.
It is clear that the current Administration seeks to significantly reform the nursing home industry in ways that could dramatically alter business practices for owners and operators. While some of these measures will require Congressional action, which may not occur given the current political landscape, several proposed initiatives can be implemented by CMS with existing authority. We will continue to monitor and report on these efforts as they develop.