Nursing Homes:

Efforts to Strengthen Federal Enforcement Have Not Deterred Some Homes from Repeatedly Harming Residents

GAO-07-241: Published: Mar 26, 2007. Publicly Released: Apr 23, 2007.

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In 1998 and 1999 reports, GAO concluded that enforcement actions, known as sanctions, were ineffective in encouraging nursing homes to maintain compliance with federal quality requirements: sanctions were often rescinded before being implemented because homes had a grace period to correct deficiencies. In response, the Centers for Medicare & Medicaid Services (CMS) began requiring immediate sanctions for homes that repeatedly harmed residents. Using CMS enforcement and deficiency data, GAO (1) analyzed federal sanctions from fiscal years 2000 through 2005 against 63 homes previously reviewed and (2) assessed CMS's overall management of enforcement. The 63 homes had a history of harming residents and were located in 4 states that account for about 22 percent of homes nationwide.

From fiscal years 2000 through 2005, the number of sanctions decreased for the 63 nursing homes GAO reviewed that had a history of serious quality problems, a decline consistent with nationwide trends. While the decline may reflect improved quality or changes to enforcement policy, it may also mask survey weaknesses that understate quality problems, an issue GAO has reported on since 1998. Although the number of sanctions decreased, the homes generally were cited for more deficiencies that caused harm to residents than other homes in their states. Almost half of the homes reviewed continued to cycle in and out of compliance; 19 did so 4 times or more. These homes temporarily corrected deficiencies and, even with sanctions, were again found out of compliance on subsequent surveys. Several weaknesses appeared to undermine the effectiveness of the sanctions implemented against the homes reviewed. First, civil money penalties (CMP), which by statute are not paid while under appeal--a process that can take years--were generally imposed at the lower end of the allowable dollar range. For example, the median per day CMP ranged from $350 to $500, significantly below the maximum of $3,000 per day. Second, CMS favored the use of sanctions that give homes more time to correct deficiencies, increasing the likelihood that the sanctions would not be implemented. Thus, more than half of the denial of payment for new admissions (DPNA) that CMS imposed were the type that give homes 3 months to correct deficiencies rather than those that only give homes up to 15 days. Third, there was no record of a sanction for about 22 percent of the homes reviewed that met CMS's criteria for immediate sanctions, a problem GAO also identified in 2003; moreover, 60 percent of DPNAs imposed as immediate sanctions were not implemented until 1 to 2 months after citation of the deficiency. Finally, involuntary termination of homes from participating in the Medicare or Medicaid programs was rare because of concerns about access to other nearby homes and resident transfer trauma; 2 of the 63 homes reviewed were involuntarily terminated because of quality problems. CMS's management of enforcement is hampered by the complexity of its immediate sanctions policy and by its fragmented and incomplete data. Its policy allows some homes with the worst compliance histories to escape immediate sanctions. For example, a home cited with a serious deficiency and that has not yet corrected an earlier serious deficiency is spared an immediate sanction. Such rules may in part explain why the 63 homes reviewed only had 69 instances of immediate sanctions over a 6-year period despite being cited 444 times for deficiencies that harmed residents. Although CMS initiated development of a new enforcement data system 6 years ago, it is fragmented and has incomplete national reporting capabilities. CMS is taking additional steps to improve nursing home enforcement, such as developing guidance to encourage more consistency in CMP amounts, but it is not clear whether and when these initiatives will address the enforcement weaknesses GAO found.

Recommendations for Executive Action

  1. Status: Open

    Comments: Aug 2014 update: CMS indicated there has been no change since the Aug 2013 update. Aug 2013 update: CMS said they are not pursuing any further work on the double G policy but will continue to focus on enforcement issues overall. In terms of complaint findings, CMS said they continue to work with individual states, such as CA, and that they will continue this approach before considering seeking additional authority. Sept 2012 update: CMS said they continue to periodically review data on double G citations and that their Complaint Consistency Workgroup is looking comprehensively at complaint processes, including how complaint reports are entered into the federal data system. We will follow up next year. Sept. 2011 update: CMS said that they are continuing to pursue this issue but have not yet defined a set of actions. We will follow up next year. Aug 2010 update: CMS indicated that its implementation of these recommendations has been delayed and that we will need to check back with them next year. Aug 2009 update: CMS has decided not to go forward with a memo on reducing the lag time and preventing homes from escaping sanctions. They believe that the current policies are sufficient. However, they may still take action on the third part of the recommendation to hold states accountable for reporting deficiencies in the federal data systems. August 2008 update: CMS is developing a Survey and Certification memo that will address the first two parts of this recommendation: 1) reduce the lag time between citation of a double G and the implementation of a sanction, and (2) prevent nursing homes that repeatedly harm residents or place them in immediate jeopardy from escaping sanctions. CMS did not specify a timeframe for issuing the memo. With regard to the third part of the recommendation, to hold states accountable for reporting in federal data systems serious deficiencies identified during complaint investigations so that all complaint findings are considered in determining when immediate sanctions are warranted, CMS surveyed states to better understand what actions states have taken. CMS learned that California continues to have difficulties citing deficiencies identified under state licensure requirements. The CMS San Francisco Regional Office is working with CA to resolve these issues and get the deficiencies recorded in the federal system. If CA does not address the issues, CMS plans to take corrective action at the end of CY08, and will consider sanctions. We will follow up again in 2009 with CMS. Aug. 07: We will follow up with CMS in 2008 on their implementation of this recommendation. CMS acknowledged that the complexity of its immediate sanctions policy may be an inherent limitation and indicated that it intends to either strengthen the policy or replace it with a policy that achieves similar goals through alternative methods. CMS agreed to reduce the lag time between citation and implementation of double G immediate sanctions by limiting the prospective effective date for DPNAs to no more than 30 to 60 days. CMS indicated it will remove the limitation in the double G policy on applying an additional sanction simply because a nursing home has not completed corrections to a deficiency that gave rise to a previous sanction. CMS agreed to collect additional information on complaints for which data are not reported in federal data systems.

    Recommendation: To address weaknesses that undermine the effectiveness of the immediate sanctions policy, the Administrator of CMS should reassess and revise the policy to ensure that it accomplishes the following three objectives: (1) reduce the lag time between citation of a double G and the implementation of a sanction, (2) prevent nursing homes that repeatedly harm residents or place them in immediate jeopardy from escaping sanctions, and (3) hold states accountable for reporting in federal data systems serious deficiencies identified during complaint investigations so that all complaint findings are considered in determining when immediate sanctions are warranted.

    Agency Affected: Department of Health and Human Services: Centers for Medicare and Medicaid Services

  2. Status: Closed - Implemented

    Comments: The civil monetary penalties (CMP) levied against the homes we reviewed were often nominal, significantly less than the maximum amount Congress provided for in statute. To strengthen CMPs, CMS had been developing a CMP grid since 2004 to guide states and regional offices in determining appropriate CMP amounts and CMS regional offices piloted the grid in 2006. We recommended that CMS ensure the consistency of CMPs by issuing guidance such as the standardized CMP grid piloted during 2006. CMS did so on June 22, 2007.

    Recommendation: To strengthen the deterrent effect of available sanctions and to ensure that sanctions are used to their fullest potential, the Administrator of CMS should ensure the consistency of CMPs by issuing guidance such as the standardized CMP grid piloted during 2006.

    Agency Affected: Department of Health and Human Services: Centers for Medicare and Medicaid Services

  3. Status: Closed - Not Implemented

    Comments: August 2009 update: CMS does not plan to take any action on this issue because they feel the current policy guidance is adequate. August 2008 update: CMS has not issued new guidance to states on this recommendation citing resource constraints and competing priorities. We will follow up with CMS in 2009 on the implementation of this recommendation. CMS indicated it will issue further guidance for states on factors to be considered in determining whether a discretionary DPNA is imposed or a termination date is set earlier than the time periods required by law.

    Recommendation: To strengthen the deterrent effect of available sanctions and to ensure that sanctions are used to their fullest potential, the Administrator of CMS should increase use of discretionary DPNAs to help ensure the speedier implementation of appropriate sanctions.

    Agency Affected: Department of Health and Human Services: Centers for Medicare and Medicaid Services

  4. Status: Closed - Not Implemented

    Comments: August 2009 update: CMS does not plan to take action on this recommendation because they feel the policy guidance is adequate. August 2008 update: CMS has not issued new guidance to states on this recommendation citing resource constraints and competing priorities. We will follow up with CMS in 2009 to determine the implementation status of this recommendation. CMS stated it will work with states, consumer organizations, stakeholders, and others to design proposals for a better combination of enforcement actions for homes with repeated quality of care deficiencies.

    Recommendation: To strengthen the deterrent effect of available sanctions and to ensure that sanctions are used to their fullest potential, the Administrator of CMS should strengthen the criteria for terminating homes with a history of serious, repeated noncompliance by limiting the extension of termination dates, increasing the use of discretionary terminations, and exploring alternative thresholds for termination, such as the cumulative duration of noncompliance.

    Agency Affected: Department of Health and Human Services: Centers for Medicare and Medicaid Services

  5. Status: Closed - Implemented

    Comments: August 2008 update: CMS submitted a legislative proposal to the Department of Health and Human Services in August 2007, and communicated the agency's support and the advisability of moving forward with legislative authority to collect CMPs prior to the exhaustion of appeals. Aug. 2007: We will follow up with CMS in 2008 to determine the implementation status of this recommendation. CMS agreed to seek legislative authority to collect CMPs prior to the exhaustion of appeals.

    Recommendation: To collect CMPs more expeditiously, which could increase their deterrent effect, the Administrator of CMS should develop an administrative process under which CMPs would be paid--or Medicare and Medicaid payments in equivalent amounts would be withheld--prior to exhaustion of appeals and seek legislation for the implementation of this process, as appropriate. Payments could be refunded with interest if the deficiencies are modified or overturned at appeal.

    Agency Affected: Department of Health and Human Services: Centers for Medicare and Medicaid Services

  6. Status: Closed - Implemented

    Comments: Update: As of Sept 2010, CMS has expanded the SFF program. According to the CMS S&C Memo (S&C 10-32-NH) "The number of SFF slots for each State are adjusted to reflect the current population of nursing homes in each State and a ten percent increase in SFF slots nationally. New Computation of the Candidate List effective in the Fall 2010, the candidate list will be adjusted so that each SFF slot will have 5 candidates from which States may recommend selection." Aug 2010 update: CMS drafted an S&C letter with guidance, including the increase of SFFs by 10%, but the initiative is delayed due to implementing the Affordable Care Act. CMS expects issuance of the revised guidance, and expansion of the number of Special Focus Facilities (SFFs), effective for FY 2011. Aug 2009 update: CMS has indicated that it might increase the number of SFFs by 25-30% (about one per state) if the President's full budget request is supported by Congress. We will follow up on this recommendation next year. Auditors Note: In Dec 09, Congress approved the full budget request for CMS's Survey and Certification branch (an increase of approximately 18%). Based on this, we anticipate that CMS would expand the SFF program. August 2008 update: CMS has not expanded the SFF program, but has taken the following steps to strengthen the program: (1) developed a template for systems integrity agreements, which may be used as an alternative to termination; (2) issued a survey and certification letter in Nov. 2007 directing states to notify nursing homes of their candidacy for the SFF program; and (3) publicly named in Nov. 2007, special focus facilities that had not improved. CMS also is developing a survey and certification letter describing the formula used to identify SFF candidates; target issuance date is October 2008. Aug. 2007: We will follow up with CMS in 2008 to determine the implementation status of this recommendation. CMS agreed with the concept of expanding the special focus facility program to include all homes that meet a threshold qualifying them as poorly performing home but said it lacks the resources needed for this expansion. CMS also identified other initiatives it will implement to improve it special focus facility program.

    Recommendation: To strengthen sanctions for homes with a history of noncompliance, such as a large number of deficiencies or a large number of actual harm and immediate jeopardy deficiencies, the Administrator of CMS should consider further expanding the Special Focus Facility program with its enhanced enforcement requirements to include all homes that meet a threshold, established by CMS, to qualify as poorly performing homes.

    Agency Affected: Department of Health and Human Services: Centers for Medicare and Medicaid Services

  7. Status: Closed - Implemented

    Comments: August 2008 update: CMS has developed linkages between AEM and ACTS. Aug. 2007: We will follow up with CMS in 2008 to determine the implementation status of this recommendation. CMS agreed to study the feasibility of linking the separate data systems used for enforcement; however, it indicated that available resources may limit further action.

    Recommendation: To improve the effectiveness of its new enforcement data system, the Administrator of CMS should develop the enforcement-related data systems' abilities to interface with each other in order to improve the tracking and monitoring of enforcement, such as by developing an automatic interface between systems such as ASPEN Enforcement Manager (AEM) and ASPEN Complaints/Incidents Tracking System.

    Agency Affected: Department of Health and Human Services: Centers for Medicare and Medicaid Services

  8. Status: Closed - Implemented

    Comments: August 2008: CMS has developed six, national AEM reports: (1) 0700D Denial of Payment; (2)0701S Denial of Payment Summary; (3) 0702D No RO Letter Sent by 70th Day; (4) 0703D Federal Waivers; (5)0704D Enforcement Cases with CMPs; and (6)0705D Enforcement Case Counts. These reports can be downloaded by states and CMS regional offices. Aug. 2007: We will follow up with CMS in 2008 to determine the implementation status of this recommendation. CMS agreed to study the feasibility of developing national standard enforcement reports, but states that further action on these reports may be limited by resource availability.

    Recommendation: To improve the effectiveness of its new enforcement data system, the Administrator of CMS should expedite the development of national enforcement reports, including longitudinal and trend reports designed to evaluate the effectiveness of sanctions and enforcement policies, and a concrete plan for using the reports.

    Agency Affected: Department of Health and Human Services: Centers for Medicare and Medicaid Services

  9. Status: Closed - Implemented

    Comments: Aug 2010: CMS officials reported that this recommendation is open but that CMS has changed program priorities to meet deadlines in the Affordable Care Act. CMS has no estimate of when changes to the system can be implemented. Aug 2009: CMS officials told us the recommendation is still open and explained "Due to budget and resource limitations, we will be unable to make any additional changes to ASPEN Enforcement Manager (AEM) in the next 15 months (Sept 2010)." August 2008 update: CMS has not instituted a formal system of quality checks. When data quality problems stand out, CMS central office follows-up with the regional offices informally. Aug. 07: We will follow up with CMS in 2008 to determine the implementation status of this recommendation. CMS agreed to develop an implement a system of quality checks to ensure the accuracy of its data systems including ASPIN Enforcement Manager (AEM).

    Recommendation: To improve the effectiveness of its new enforcement data system, the Administrator of CMS should develop and institute a system of quality checks to ensure the accuracy and integrity of AEM data, such as periodic data audits conducted as part of CMS's annual state performance reviews.

    Agency Affected: Department of Health and Human Services: Centers for Medicare and Medicaid Services

  10. Status: Closed - Implemented

    Comments: July 2011: As of July 2011, CMS is now posting enforcement action data on Nursing Home Compare. Specifically, they are posting information about the number of Civil Money Penalties and Denials of Payment for New Admissions that have been levied against the home.August 2008: CMS will not take further action on this recommendation because it is implementing a new five-star rating system for nursing homes, which the agency believes is superior to adding enforcement action data on Nursing Home Compare. Aug. 07: We will follow up with CMS in 2008 to determine the implementation status of this recommendation. CMS proposed public reporting of implemented sanctions only for poorly performing homes that meet an undefined threshold. This approach is not fully responsive to our recommendation which covered implemented sanctions against all nursing homes.

    Recommendation: To improve public information available to consumers that helps them assess the quality of nursing home care, the Administrator of CMS should expand CMS's Nursing Home Compare Web site to include implemented sanctions, such as the amount of CMPs and the duration of DPNAs, and homes subjected to immediate sanctions.

    Agency Affected: Department of Health and Human Services: Centers for Medicare and Medicaid Services

 

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