Nursing homes shoot for the stars and land among one or two

Over one-third of the 15,500 nursing homes in the U.S. received ratings of just one or two stars on CMS’s Five-star quality rating system, according to an analysis by the Kaiser Family Foundation (KFF). The analysis, which examined the ratings used to score nursing homes based upon deficiencies identified during health inspections, reveals that a significant number of nursing homes—those responsible for 39 percent of the nation’s nursing home residents—are failing in terms of staffing and care quality.


In 2008, CMS modified its Nursing Home Compare website to include a more user-friendly five-star rating system based upon quality ratings for each of the Medicare and Medicaid certified nursing homes. As a result of 2015 changes, the rating system uses three domains—(1) state health inspections; (2) staffing ratios; and (3) quality measures—to rank nursing homes from the lowest in quality (one star) to the highest in quality (five stars). The CMS changes are part of an ongoing effort to increase the star ratings’ reliability, as mandated by the Patient Protection and Affordable Care Act (ACA) (P.L. 111-148) and the Improving Medicare Post-Acute Care Transformation Act (IMPACT Act) (P.L. 113-185). One change mandated by the ACA will be the inclusion of “staffing data collected quarterly from electronic systems used for payroll reporting” as an alternative to self-reported data.


The KFF analysis used data from the Nursing Home Compare database February 2015 data release. The study looked at information including a “nursing home’s name, location, size, and number of recorded deficiencies and fines.” The analysis was restricted by the data set to only nursing homes with Medicaid or Medicare participation or both. KFF cautioned that the analysis does not demonstrate the validity or reliability of the CMS data set, but instead, is intended to show variation among states and nursing home characteristics.


In addition to the finding that 36 percent of nursing homes scored just one or two stars on the rating system, the analysis uncovered that 45 percent of nursing homes have an overall rating of four or five stars. Those 45 percent of high scoring nursing homes account for 41 percent of all nursing home residents in the nation. The analysis indicated that high scores may be due in part to self-reporting because scores on self-reported measures tended to outperform scores from state health inspections.

Profit and size

According to KFF, for-profit facilities performed less well than non-profit facilities. For example, one in five for-profit nursing homes received one star, whereas one in ten non-profit nursing homes received a one-star rating. Additionally, 33 percent of non-profit nursing homes received five stars, whereas only 18 percent of for-profit facilities received the highest rating. Smaller facilities also outperformed larger facilities with 39 percent of nursing homes with 60 or fewer beds receiving five stars and just 14 percent of nursing homes with 120 beds or more receiving five stars. KFF hypothesized that the lower scores among larger facilities are likely a result of the lower staffing numbers seen in large nursing homes.

State level

The analysis also found significant variation among states. For example, in 11 states, at least 40 percent of the nursing homes scoed one or two stars. In Texas, 51 percent of nursing homes received either one or two stars. Nine states, including Texas, Louisiana,

Oklahoma, Kentucky, Tennessee, New Mexico, West Virginia, Ohio, and Georgia, had more than 20 percent of nursing homes with one star. On the positive side, in 22 states and the District of Columbia, at least half of the nursing homes scored a four or a five on the star-rating system. Additionally, 66 percent of U.S. counties have a nursing home with a four or five star rating.

Kusserow on Compliance: OIG on swing beds at critical access hospitals

The OIG has issued a report that notes costs for swing bed usage at critical access hospitals (CAHs) are significantly increasing since 2005 at an average of almost four times the cost of similar services at alternative facilities. Of the 100 CAHs sampled in the OIG study, it found that 90 percent could have been provided at alternative facilities within a 35-mile radius with available skilled nursing care. The report estimated that Medicare could have saved $4.1 billion over a 6-year period if payments for swing bed services at CAHs were made using skilled nursing facility prospective payment system (SNF PPS) rates.

The OIG called for new legislation to adjust CAH swing bed reimbursement rates to the lower SNF PPS rates paid for similar services at alternative facilities. This proposal would significantly change the way rural-based hospitals are reimbursed for care provided in post-acute care swing beds. The OIG further recommended that the agency switch CAH reimbursement to the SNF prospective payment rate as soon as possible. CMS agreed with the OIG findings that CAH’s swing bed utilization has increased, but not necessarily the calculations of savings. CMS also disagreed with the OIG recommendation for a legislative solution because of concerns about the availability of skilled nursing services at nearby alternative facilities.

It did not take long for those representing the affected parties to line up behind CMS and oppose the changes promoted by the OIG. Leading the pack was the American Hospital Association (AHA), who quickly weighed in on the issue, echoed CMS concerns, and noted as such in a published statement. The AHA said it “continue(s) to strongly advocate for maintaining the CAH program as it is currently structured in order to help ensure that all patients in rural communities have access to health care.”

Richard P. Kusserow served as DHHS Inspector General for 11 years. He currently is CEO of Strategic Management Services, LLC (SM), a firm that has assisted more than 3,000 organizations and entities with compliance related matters. The SM sister company, CRC, provides a wide range of compliance tools including sanction-screening.

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Copyright © 2015 Strategic Management Services, LLC. Published with permission.

Senior respect or abuse and neglect? Florida law sparks debate

A bill designed to address problems of abuse and neglect in Florida’s assisted living facilities has passed the Florida Senate and was sent to the state’s governor for approval. Proponents of the bill say that it will fill a problematic void and improve enforcement and oversight in the facilities that serve over 86,000 senior Floridians. Opponents of the legislation criticize the fact that the law would reduce the number of oversight visits for facilities with good records.

HB 1001/SB 382

Under the status quo in Florida, facilities are subject to inspections every two years. However, under the new bill, HB 1001/SB 382, homes that are found to have a major violation would be subject to more frequent inspections. The bill clarifies standards for the revocation of licensing for facilities that continually violate regulatory standards. The bill also authorizes a $500 penalty for facilities that fail to provide background screenings for staff. Regulators would also be permitted, under the law, to double fines on facilities that fail to correct serious violations within a six-month period.


Republican state representative Larry Ahern said that the goal of the legislation was to “find a balance” between oversight, business interests, and patient needs. Ahern expressed the opinion that the focus of any legislation should be on “bad apples because the good ones will take care of themselves—for the most part.” However, Brian Lee, director of the advocacy group Families for Better Care, said that the legislation “will only shrink oversight of those assisted living facilities who care for the most vulnerable ALF residents.” Additionally, Lee warned that the facilities “need more oversight, not less.”

Highlight on Pennsylvania: Healthy PA is going away, ACA expansion gets its day

Pennsylvania’s Medicaid program will make the transition to traditional Medicaid expansion by September 30, 2015, according to the Pennsylvania Department of Human Services (DHS). The state Medicaid program is in the process of moving from the alternative Medicaid expansion program known as Healthy PA to an expansion of traditional Medicaid as intended by the Patient Protection and Affordable Care Act (ACA) (P.L. 111-148).

Power Struggle

The outline for the Healthy PA plan came from Pennsylvania’s former governor, Tom Corbett (R). Healthy PA took ACA dollars and used them to subsidize private plans for Pennsylvania’s working poor. According to the Pittsburgh Post-Gazette, the plan received approval from federal regulators in August 2014. Although the approval was received three months before the election and Corbett eventually lost his reelection campaign, the former governor went ahead with Healthy PA’s implementation despite the fact that the Democratic Gov. Tom Wolf indicated his plan to undo Healthy PA when he took office.


Now that Governor Wolf is in office, Pennsylvania plans to transition out of Healthy PA and into an ACA expansion of Pennsylvania’s existing Medicaid program—HealthChoices.  The Pennsylvania DHS will implement the transition through two phases. The first phase will operate between April 2015 and June 1, 2015. In the first phase, individuals will begin to be transferred from the private coverage option (PCO) into the new adult benefit package under HealthChoices. During the first phase, new applicants will no longer be enrolled in the private coverage option. In the second phase, which is set to take place between July 2015 and September 30, 2015, Pennsylvania will transition all remaining PCO enrollees into HealthChoices. At the end of the transition, Pennsylvania estimates that Wolf’s plan will provide access to health care coverage for hundreds of thousands of Pennsylvanians. The Pennsylvania DHS was clear in its announcement that no gaps in coverage will occur during the transition and that enrollees will be informed by mail prior to the change.

Other Changes

In addition to the move towards a more traditional expansion, Governor Wolf has pushed for other changes to the Medicaid program.  Specifically, the new governor pushed for reforms to allow the state’s elderly poor to receive home and community-based services in place of nursing home based services. The reform is intended to lower the $27.6 billion that Pennsylvania annually spends on Medicaid.