Feds Cracking Down on Poorest-Performing Nursing Homes

The federal agency in charge of the Medicare and Medicaid programs is making an effort to improve nursing home care. The Centers for Medicare and Medicaid Services (CMS) announced that they are increasing their scrutiny and oversight over the country's poorest-performing nursing facilities.

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Feds Cracking Down on Poorest-Performing Nursing Homes
3 Min Read October 23rd, 2022

The federal agency in charge of the Medicare and Medicaid programs is making an effort to improve nursing home care. The Centers for Medicare and Medicaid Services (CMS) announced that they are increasing their scrutiny and oversight over the country's poorest-performing nursing facilities to improve the care they deliver immediately. Many older adults require long-term care in a facility, while others need a shorter period of care for rehabilitation after a health event or accident.

While Medicare only pays for a limited amount of skilled nursing home services, many older adults start their care following a rehab or nursing home stay. Nursing homes that accept Medicare payments must meet federal standards.

The Special Focus Facility (SFF) Program will undergo several changes from CMS. These changes include stricter requirements for program completion and more severe enforcement actions against facilities that don't show improvement. Additionally, CMS urges states to consider staffing levels when choosing which hospitals will participate in the SFF Program.

According to the Biden administration, steps are being taken to strengthen nursing homes' standards, make them safer, and hold bad actors in the sector more accountable.

Department of Health and Human Services Secretary Xavier Becerra says it should be clear that the government is cracking down on enforcement of the nation's poorest-performing nursing homes.

As President Biden directed, we are increasing scrutiny and taking aggressive action to ensure everyone living in nursing homes gets the high-quality care they deserve. We are demanding better, because our seniors deserve better.


FACT SHEET: New Steps to Improve Quality of Nursing Homes - The White House

Safe Quality Care is the Goal

CMS Administrator Chiquita Brooks-LaSure says that nursing institutions in the United States must improve their performance. She says nursing homes must give their residents access to safe and high-quality care; failing to do so will have negative implications.

"Poor-performing nursing homes have the opportunity to improve, but if they fail to do so, the changes we are making to CMS' Special Focus Facilities Program will hold these facilities accountable for the health and safety of their residents."

All nursing homes want to avoid being designated as Special Focus Facilities (SFF). SFF has tighter oversight, more frequent assessments, and an obligation to improve or risk losing its Medicare/Medicaid certification. Nursing homes with a history of severe violations for yearly health inspections/surveys can be added to the program. 

There are several revisions to the SFF program

Caregivers Defended

Mark Parkinson, the president and CEO of the American Health Care Association (AHCA) and the National Center for Assisted Living (NCAL), says they support some of the measures being taken. However, he has a concern that this discussion might be degrading to the millions of nursing home caregivers.

We appreciate some of the steps the Biden Administration is making today to address the small portion of chronically, poor performing nursing homes as well as grant opportunities to help address our long-term care labor crisis. However, we remain concerned that the rhetoric surrounding these reforms is degrading to the millions of nursing home caregivers who are committed to caring for their residents like their own family and have risked their lives serving on the frontlines during this pandemic.

Parkinson says long-term care residents are not victims of the nursing home industry. He says that too many were "victims of a vicious virus" that targets the elderly and "terrible public policy decisions—made by both parties—that failed to support and prioritize our most vulnerable."   

The Long-Term Care Community Coalition tweeted that nursing homes were profiteering from the neglect of vulnerable residents. 

The Nation is Aging

With an aging nation, the concern for the quality of long-term health care has become a higher priority. Professional in-home care and facilities like adult day care centersassisted living and memory care, in addition to nursing homes, are facing higher costs and labor shortages. 

Medicare only pays for a short time in skilled care in a nursing home facility. Medicaid is the top payer of long-term care services in the U.S. but will only pay for services when the care recipient has little or no income and assets. Many facilities need CMS certification because of the large number of older adults who need care.

Long-Term Care Insurance doesn't directly require a facility or home care provider to have CMS certification, but most quality facilities will have it. 

The increasing number of older adults is putting pressure on the system. There is a shortage of staffing on all levels. Inflation and higher labor costs are dramatically increasing long-term health care costs. Medicaid reimbursements are much lower than regular costs, which puts Medicaid facilities in a difficult situation dealing with staff and resident ratios.

State Implementing Taxes for Long-Term Care 

Several states are considering implementing a tax plan similar to the one in the State of Washington. The plan taxes residents on 100% of earned income unless they own a qualified Long-Term Care Insurance policy.

Most People Fail to Plan

The quality of long-term care is often on a family's mind when their older parent starts to decline. Several years ago, an Associated Press-NORC Center for Public Affairs Research survey showed that planning for long-term care needs is falling far behind. Only 67% of the respondents reported having done little to no planning.

The threat of being taxed did increase the number of people who purchased Long-Term Care Insurance in the State of Washington. About 450,000 Washingtonians purchased a qualified LTC policy before the deadline and opted out of the tax.

Tax Benefits to Encourage Long-Term Care Planning

The federal government, and several states, have other tax incentives available to encourage planning. These incentives include tax deductions, the use of pre-tax funds in Health Savings Accounts, and the federal/state Long-Term Care Partnership program are available. 

The theory is if more people have LTC coverage, it will do several things for American families:

  • Reduce the pressure on state and federal budgets for Medicaid
  • Improve the quality of care
  • Relieve the stress and burdens on family members who often become unpaid caregivers
  • Reduce the need for nursing homes and allow more people to stay at home 

Generally, people look at Long-Term Care Insurance in their 50s. Most people qualify for Medicare when they turn age 65. Medicaid is available at any age but requires the individual to have little or no income and assets.

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Editor's Note

The need for long-term care services will increase as you get older. Chronic illnesses, accidents, mobility problems, dementia, and the fragility of aging all result in a higher risk of needing long-term health care.

The responsibility is yours. Are you prepared? Do you want to put the burden of caregiving on your adult children? Would you like to see your 401(k) and other savings liquidated to pay for care? There is a better solution.

Long-Term Care Insurance is an affordable way to address the rising costs and burdens that come with long-term health care. There are several options from several top-rated insurance companies to consider.

Seek the help of a qualified Long-Term Care Insurance specialist to help match your age, health, and family history with the right company. The specialist should provide accurate quotes from all the top companies; otherwise, find one who will. 

Most people get their coverage in their 50s. 

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