Nursing Homes
Opportunities Exist to Facilitate the Use of the Temporary Management Sanction Gao ID: GAO-10-37R November 20, 2009The nation's 1.4 million nursing home residents are a highly vulnerable population of elderly and disabled individuals for whom remaining at home is no longer feasible. The federal government plays a key role in ensuring that nursing home residents receive appropriate care by setting quality requirements that nursing homes must meet to participate in the Medicare and Medicaid programs and by contracting with states to conduct routine inspections--called standard surveys--and complaint investigations. To encourage compliance with quality requirements, Congress has authorized certain enforcement actions, known as sanctions, such as civil money penalties or termination from participating in the Medicare and Medicaid programs. The Centers for Medicare & Medicaid Services (CMS) is responsible for imposing federal sanctions, typically on the basis of states' recommendations. One sanction--temporarily replacing a home's management--has been used infrequently. According to CMS guidance, temporary management may be used instead of termination in cases where nursing homes place residents at risk of death or serious injury--referred to as immediate jeopardy--or place residents at widespread risk of actual harm. CMS requires that a nursing home remove any immediate jeopardy within a short time frame of 23 calendar days after the survey or complaint investigation in which it was cited, with or without the assistance of temporary management. Otherwise, CMS will terminate the home from Medicare and Medicaid. In some cases, the nursing home's owner may choose to sell the home to a new owner while the home is still under temporary management. Congress was interested in information on why the temporary management sanction has been used infrequently to address nursing home quality problems and asked us to study this issue. Specifically, we focused on (1) CMS and states' experience with the use of federal temporary management and its effectiveness in achieving compliance in the short and longer term; and (2) obstacles to the use of federal temporary management and how such obstacles could be addressed. Congress also asked us to examine whether changes in ownership occurred when nursing homes were under federal temporary management and to identify obstacles to such ownership changes.
Based on responses from officials in the 10 states and seven CMS regional offices that used the federal temporary management sanction from fiscal years 2003 through 2008, the sanction was used with success in the short term in homes where there was some combination of immediate jeopardy, a history of noncompliance with CMS quality requirements, or the failure of other sanctions to bring about compliance. However, some homes continued to have compliance problems in the longer term, that is, since the conclusion of temporary management. Officials from 46 states and seven CMS regional offices identified several obstacles to using federal temporary management, including time constraints, a lack of qualified temporary managers, and inadequate funding to pay for a temporary manager. Specifically, officials from 24 states and five CMS regional offices characterized the 23 days as a short time frame in which to hire a temporary manager and remove immediate jeopardy before automatic termination from participation in Medicare and Medicaid, therefore making it difficult to use the sanction. Additionally, officials from 25 of the 46 states told us they did not maintain a list of potential temporary managers, which could impede their ability to identify qualified candidates on a timely basis. State and CMS regional officials also identified ways for CMS to address some of the obstacles to using the sanction, such as developing lists of qualified temporary managers and providing additional information that addresses best practices and when and how to use the sanction. In addition, several officials suggested the need for an approach to help ensure the longer-term success of temporary management.
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Director: Team: Phone:GAO-10-37R, Nursing Homes: Opportunities Exist to Facilitate the Use of the Temporary Management Sanction
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GAO-10-37R:
United States Government Accountability Office:
Washington, DC 20548:
November 20, 2009:
Congressional Requesters:
Subject: Nursing Homes: Opportunities Exist to Facilitate the Use of
the Temporary Management Sanction:
The nation's 1.4 million nursing home residents are a highly vulnerable
population of elderly and disabled individuals for whom remaining at
home is no longer feasible. The federal government plays a key role in
ensuring that nursing home residents receive appropriate care by
setting quality requirements that nursing homes must meet to
participate in the Medicare and Medicaid programs and by contracting
with states to conduct routine inspections--called standard surveys--
and complaint investigations.[Footnote 1] To encourage compliance with
quality requirements, Congress has authorized certain enforcement
actions, known as sanctions, such as civil money penalties or
termination from participating in the Medicare and Medicaid programs.
The Centers for Medicare & Medicaid Services (CMS) is responsible for
imposing federal sanctions, typically on the basis of states'
recommendations.[Footnote 2] One sanction--temporarily replacing a
home's management--has been used infrequently. According to CMS
guidance, temporary management may be used instead of termination in
cases where nursing homes place residents at risk of death or serious
injury--referred to as immediate jeopardy--or place residents at
widespread risk of actual harm. CMS requires that a nursing home remove
any immediate jeopardy within a short time frame of 23 calendar days
after the survey or complaint investigation in which it was cited, with
or without the assistance of temporary management. Otherwise, CMS will
terminate the home from Medicare and Medicaid. In some cases, the
nursing home's owner may choose to sell the home to a new owner while
the home is still under temporary management.
You were interested in information on why the temporary management
sanction has been used infrequently to address nursing home quality
problems and asked us to study this issue. Specifically, we focused on
(1) CMS and states' experience with the use of federal temporary
management and its effectiveness in achieving compliance in the short
and longer term; and (2) obstacles to the use of federal temporary
management and how such obstacles could be addressed. You also asked us
to examine whether changes in ownership occurred when nursing homes
were under federal temporary management and to identify obstacles to
such ownership changes. We provide this information in enclosure I.
To examine CMS and states' experience with the use of federal temporary
management and its effectiveness in achieving compliance in the short
and longer term, we identified the states where the sanction was used
from fiscal years 2003 through 2008 by analyzing data from CMS's
Providing Data Quickly (PDQ) reporting system.[Footnote 3] We assessed
the short-term effectiveness of temporary management by the sanction's
ability to achieve its intended objective, which primarily was to
return the home to compliance with federal quality requirements. We
assessed the longer-term effectiveness of temporary management by the
ability of a home to maintain substantial compliance after the
conclusion of temporary management. From fiscal years 2003 through
2008, the federal temporary management sanction was used in 14 nursing
homes across 10 states; these 10 states were located in 7 of 10 CMS
regions (see enclosure II).[Footnote 4] We interviewed officials from 1
of the 10 state survey agencies and its corresponding CMS regional
office and then sent a set of similar questions to the remaining state
survey agencies and regional offices.[Footnote 5] Officials from all 10
states confirmed the use of the sanction and together with the seven
CMS regional offices provided information for our analysis on: (1)
common characteristics of instances in which the sanction was used; (2)
the sanction's ability to correct quality-of-care problems; and (3)
instances of immediate jeopardy when federal temporary management was
not used. In addition, we analyzed data from CMS's On-line Survey,
Certification, and Reporting system (OSCAR) on the compliance history
of the 14 homes subject to federal temporary management from fiscal
years 2003 through 2008.[Footnote 6] To ensure the reliability of the
OSCAR data we analyzed, we interviewed CMS officials, reviewed CMS
documentation, conducted electronic testing to identify obvious errors,
and traced a selection of records to another CMS reporting system.
Based on these activities, we determined the data we analyzed were
sufficiently reliable for our purposes. In addition, we used CMS data
from PDQ and the Nursing Home Compare Web site to identify
characteristics of the 14 homes, such as the number of certified beds
and ownership type. To ensure the reliability of these data, we
interviewed CMS regional officials, reviewed CMS documentation, and
confirmed the accuracy of some data elements with state or CMS regional
officials. Based on these activities, we determined the data were
sufficiently reliable for our purposes.
To examine obstacles to the use of federal temporary management and how
they could be addressed, we received additional information from 9 of
the 10 states and seven CMS regional offices where the sanction was
used from fiscal years 2003 through 2008.[Footnote 7] We also sent a
standardized set of questions to the remaining 41 states. Officials
from 37 of the 41 states confirmed that the sanction had not been used
from fiscal years 2003 through 2008 and responded to our
questions.[Footnote 8] Overall, we received and analyzed responses from
46 states and seven CMS regional offices on (1) obstacles to the
effective use of the sanction; (2) existence and maintenance of state
temporary manager lists; (3) use of state alternatives to federal
temporary management; (4) obstacles to bringing about a change in
ownership in cases where federal temporary management was used; and (5)
suggestions for improving the federal temporary management sanction.
Finally, GAO discussed state alternatives to temporary management,
funding options for temporary management, and suggestions for improving
the sanction at a membership meeting of the Association of Health
Facility Survey Agencies (AHFSA), the organization that represents
state survey agencies.
We conducted this performance audit from February 2009 through November
2009 in accordance with generally accepted government auditing
standards. Those standards require that we plan and perform the audit
to obtain sufficient, appropriate evidence to provide a reasonable
basis for our findings and conclusions based on our audit objectives.
We believe that the evidence obtained provides a reasonable basis for
our findings and conclusions based on our audit objectives.
Results in Brief:
Based on responses from officials in the 10 states and seven CMS
regional offices that used the federal temporary management sanction
from fiscal years 2003 through 2008, the sanction was used with success
in the short term in homes where there was some combination of
immediate jeopardy, a history of noncompliance with CMS quality
requirements, or the failure of other sanctions to bring about
compliance. In 11 of the 14 homes, officials used the sanction with the
objective of returning the home to compliance with federal quality
requirements, and in 10 of those homes temporary management was
successful in the short term at doing so. However, some homes continued
to have compliance problems in the longer term, that is, since the
conclusion of temporary management. For example, while 9 of these 10
homes remained open as of August 2009, CMS data showed that 4 of them
were cited for immediate jeopardy after temporary management.
Officials from 46 states and seven CMS regional offices identified
several obstacles to using federal temporary management, including time
constraints, a lack of qualified temporary managers, and inadequate
funding to pay for a temporary manager. Specifically, officials from 24
states and five CMS regional offices characterized the 23 days as a
short time frame in which to hire a temporary manager and remove
immediate jeopardy before automatic termination from participation in
Medicare and Medicaid, therefore making it difficult to use the
sanction. Additionally, officials from 25 of the 46 states told us they
did not maintain a list of potential temporary managers, which could
impede their ability to identify qualified candidates on a timely
basis. State and CMS regional officials also identified ways for CMS to
address some of the obstacles to using the sanction, such as developing
lists of qualified temporary managers and providing additional
information that addresses best practices and when and how to use the
sanction. In addition, several officials suggested the need for an
approach to help ensure the longer-term success of temporary
management.
To improve the usefulness of the federal temporary management sanction,
we are recommending that the Administrator of CMS take the following
three actions: (1) create and maintain lists of qualified temporary
managers; (2) develop information that identifies best practices such
as when and how to use the sanction; and (3) develop guidance for
states to help ensure the longer-term compliance of homes that have
undergone temporary management. We provided a draft of this report to
the Department of Health and Human Services and AHFSA for comment. In
response, CMS said that our study added value to the important public
policy discussions regarding the use of temporary management, an
important tool that states can recommend and CMS can impose in
situations of immediate jeopardy. CMS said that it endorsed the spirit
of our recommendations but did not fully agree with all of them.
Specifically, CMS agreed to develop additional information that
identifies best practices for states and said that it would explore
alternatives to the development of state guidance intended to help
ensure the longer-term compliance of homes. However, the agency
indicated that it did not plan to create lists of temporary managers.
AHFSA agreed with the need for CMS to provide clearer information on
the temporary manager process, but did not say whether it agreed with
our other two recommendations. While we recognize that the development
and maintenance of lists of temporary managers will require time and
resources on the part of states and CMS, we maintain that the full
potential of what CMS characterizes as an important tool will not be
fully realized without such lists.
Background:
Titles XVIII and XIX of the Social Security Act established minimum
federal quality requirements that all nursing homes must meet to
participate in the Medicare and Medicaid programs,
respectively.[Footnote 9] With the Omnibus Budget Reconciliation Act of
1987 (OBRA 87), Congress focused the requirements on the quality of
care actually provided by a home.[Footnote 10]
Ensuring Compliance with Federal Quality Requirements:
CMS contracts with states to assess whether nursing homes meet federal
quality requirements through standard surveys and complaint
investigations.[Footnote 11] A standard survey involves a comprehensive
assessment of quality requirements, while complaint investigations
generally focus on a specific allegation regarding resident care or
safety. States classify deficiencies identified during either standard
surveys or complaint investigations in 1 of 12 categories, labeled A
through L, according to their scope (i.e., the number of residents
potentially or actually affected) and severity (i.e., the degree of
relative harm involved). Homes with deficiencies at the A through C
levels are considered to be in substantial compliance with federal
quality requirements, while those with D-level or higher deficiencies
are considered noncompliant (see table 1). Deficiencies at the J level
or higher constitute immediate jeopardy, a situation in which the
home's noncompliance with one or more requirements of participation has
caused, or is likely to cause, serious injury, harm, impairment, or
death to a resident.
Table 1: Scope and Severity of Deficiencies Identified during Standard
Surveys and Complaint Investigations:
Severity: Immediate jeopardy[A];
Scope: Isolated: J;
Scope: Pattern: K;
Scope: Widespread: L.
Severity: Actual harm;
Scope: Isolated: G;
Scope: Pattern: H;
Scope: Widespread: I.
Severity: Potential for more than minimal harm;
Scope: Isolated: D;
Scope: Pattern: E;
Scope: Widespread: F.
Severity: Potential for minimal harm[B];
Scope: Isolated: A;
Scope: Pattern: B;
Scope: Widespread: C.
Source: CMS.
[A] Actual or potential for death/serious injury.
[B] Nursing home is considered to be in "substantial compliance."
[End of table]
Federal and State Enforcement:
Nursing homes that fail to meet federal quality requirements may be
subject to statutory federal enforcement actions known as sanctions.
CMS and the states share responsibility for federal enforcement
actions. States are responsible for enforcing federal requirements in
homes with Medicaid-only certification and may also impose enforcement
actions under state licensure authority.[Footnote 12]
In general, federal sanctions are (1) initially proposed by the state
based on a cited deficiency, (2) reviewed and imposed by CMS regional
offices, and (3) implemented--that is, put into effect--by the same
regional office, usually after a required notice period.[Footnote 13]
Sanctions are generally reserved for serious deficiencies--those at the
G through L levels--and the severity of sanctions typically increases
with the severity of the deficiency. Sanctions include fines known as
civil money penalties (CMP), denial of payment for new Medicare or
Medicaid admissions (DPNA), directed plan of correction, state
monitoring, temporary management, and termination from the Medicare or
Medicaid program, or both.[Footnote 14]
When a nursing home is cited with one or more deficiencies that
constitute immediate jeopardy to resident health or safety, the law
requires immediate action to remove the deficiencies through the use of
federal temporary management or termination from Medicare and Medicaid.
[Footnote 15] In addition, other sanctions may be imposed. CMS
interprets the law's requirement for "immediate" action to remove the
jeopardy and correct the deficiencies by establishing the time frame of
23 calendar days from the date of the standard survey or complaint
investigation that cited the deficiency.[Footnote 16] In contrast, a
nursing home has 6 months to return to substantial compliance for non-
immediate-jeopardy level deficiencies.
In lieu of a federal sanction, a state may (1) use an acceptable
alternative that it has demonstrated to CMS is as effective in
deterring noncompliance and correcting deficiencies and that CMS has
approved, or (2) use its own sanctions under the state's licensure
authority.[Footnote 17] Examples of approved state alternative
sanctions to federal temporary management or similar sanctions that
states may use under their licensure authority include state temporary
management, receivership, and trusteeship; the latter two sanctions are
similar to temporary management but require court involvement.[Footnote
18]
Federal Temporary Management:
CMS regional offices use temporary management to achieve one of two
objectives: (1) to correct deficiencies and return the home to
substantial compliance with federal quality requirements, or (2) to
oversee orderly closure of a nursing home and relocation of residents.
[Footnote 19] The nursing home must voluntarily agree to relinquish
control to the temporary manager and to pay his/her salary as well as
pay for improvements to the home that the temporary manager deems
necessary.[Footnote 20] However, if the home refuses to relinquish
control to the temporary manager, the home will be terminated from
Medicare and Medicaid within 23 calendar days if the immediate jeopardy
is not removed. A temporary manager has full authority to hire,
terminate, or reassign staff; spend nursing home funds; alter nursing
home procedures; and otherwise manage a home to achieve the objective.
[Footnote 21] The CMS regional office selects the temporary manager
based on state recommendations.[Footnote 22] CMS guidance recommends
that states maintain a list of eligible temporary managers who meet
certain criteria set by CMS--such as not having worked for the home in
the past 2 years--and whose past performance, work experience, and
education indicate that they are qualified to serve as temporary
managers.[Footnote 23] The state can request the temporary manager to
periodically report on the actions taken to achieve compliance.
Temporary management generally continues until a home is terminated
from Medicare and Medicaid or achieves and demonstrates to the CMS
regional office and the state the capability of maintaining substantial
compliance--no deficiencies higher than C level.
CMS Efforts to Identify Nursing Homes with Poor Compliance Histories:
CMS makes information on the compliance history of nursing homes
available to the public through its Nursing Home Compare Web site. For
every nursing home that participates in Medicare and Medicaid, the Web
site provides information on deficiencies cited during standard surveys
and any intervening complaint investigations. It also identifies those
homes with poor compliance histories that have been designated Special
Focus Facilities (SFF). Through the SFF Program, CMS monitors a limited
number of such nursing homes; states are required to survey SFFs twice
as frequently as other nursing homes.[Footnote 24]
In addition, the Nursing Home Compare Web site provides a rating for
each nursing home from one (much below average) to five (much above
average) stars, known as the Five-Star Quality Rating System.[Footnote
25] CMS implemented this new rating system in December 2008. A nursing
home's overall quality rating is based on individual ratings for three
separate components: (1) compliance history; (2) staffing levels; and
(3) quality-of-care measures.[Footnote 26] A home's compliance history--
results from the last 3 years of a home's standard surveys and
complaint investigations--is the most important component in
determining the overall quality rating.[Footnote 27]
Federal Temporary Management Used for Homes with Histories of
Noncompliance, and These Homes Generally Corrected Deficiencies in the
Short Term, but Some Had Longer-Term Compliance Problems:
Based on responses from officials in the 10 states and seven CMS
regional offices that used federal temporary management from fiscal
years 2003 thorough 2008, the sanction was primarily used for homes
with some combination of immediate jeopardy level deficiencies,
histories of noncompliance, or continuing noncompliance despite the use
of other sanctions. Most homes under temporary management corrected
deficiencies in the short term, but some homes continued to have
compliance problems in the longer term.
Federal Temporary Management Used for Homes with Immediate Jeopardy,
Histories of Noncompliance, or When Other Sanctions Were Ineffective:
State and CMS regional officials told us that for 13 of the 14 homes
where the federal temporary management sanction was used from fiscal
years 2003 through 2008 a combination of several factors such as
immediate jeopardy level deficiencies, repeated noncompliance with
federal quality requirements, or the failure of other sanctions to
bring about compliance led them to use the sanction.[Footnote 28] In
all but 3 of the 14 homes, immediate jeopardy as well as other
deficiencies were identified on the survey or surveys that led
officials to use the sanction.[Footnote 29] For example, a home in
South Dakota had a history of noncompliance resulting in multiple
federal sanctions, including a DPNA, which officials told us had been
ineffective in deterring noncompliance. On one survey, the home was
cited with two immediate jeopardy level deficiencies and placed under
temporary management.[Footnote 30] Enclosure III summarizes the
compliance history and the objectives and outcomes of the 14 homes in
which federal temporary management was used during the period we
studied.
CMS compliance data on standard surveys and complaint investigations
confirm that most of the 14 homes had histories of noncompliance prior
to the imposition of temporary management.[Footnote 31] In analyzing
the compliance history of the 14 homes, we found that they averaged 37
D-L level deficiencies in the year immediately prior to temporary
management, far more than the nationwide average of about 8 D-L level
deficiencies in fiscal year 2008.[Footnote 32] Furthermore, 12 of the
13 homes where survey data were available had between 1 and 20
deficiencies at the actual harm level (G-I) over the 3 years prior to
the survey that resulted in temporary management. Four of those homes
also had at least 1 immediate jeopardy level deficiency (J-L) in that
same time period. Although the 13th home did not have a history of
actual harm or immediate jeopardy level deficiencies, the survey that
led to temporary management identified 9 actual harm and 44 immediate
jeopardy deficiencies (see enclosure III). Four of the 14 homes were in
CMS's SFF program at the time they were placed under federal temporary
management, indicating that CMS had previously identified the homes as
having histories of noncompliance.
In addition to instances of immediate jeopardy and a poor compliance
history, state and CMS regional officials gave several reasons for
using federal temporary management to bring the homes into
compliance.[Footnote 33] Officials in four states told us they
recommended that CMS use temporary management when they considered the
home's current administration to be incapable of improving conditions.
For example, one home had significant staff turnover, including at the
management level, which led the state and CMS officials to question the
home's ability to correct deficiencies and maintain compliance without
outside help. In another four homes, state officials told us they
recommended temporary management in part because termination would have
resulted in relocating residents a great distance due to the limited
available nursing home space in the area or because specialized
services were offered at only a limited number of homes in the state.
State officials told us that they did not recommend temporary
management in instances of immediate jeopardy when they determined that
the nursing home could correct the immediate jeopardy on its own.
[Footnote 34] For example, in many cases a home's management
demonstrated that it could resolve the deficiencies and did so quickly.
In some cases, states recommended the use of other federal sanctions
such as CMPs to encourage the home to correct the deficiencies, or
otherwise monitored the home.[Footnote 35] Thus, two states recommended
a home for the SFF program and others used directed plans of correction
requiring homes to hire independent consultants to address conditions
that resulted in the citation of deficiencies.[Footnote 36]
While Most Homes under Temporary Management Corrected Deficiencies in
the Short Term, Some Were Unable to Maintain Compliance in the Longer
Term:
According to CMS regional office and state officials, federal temporary
management was successful in achieving its intended objective in the
short term in 13 of the 14 homes.[Footnote 37] First, in 11 of the 14
homes, federal temporary management was used with the objective of
correcting deficiencies that caused the home to be noncompliant with
federal quality requirements; in 10 of these 11 homes, temporary
management was successful in achieving this objective. The home that
failed to return to substantial compliance was terminated from Medicare
and Medicaid, and closed. Second, in 2 of the 14 homes, the sanction
was used to oversee the orderly closure of and relocation of residents
from homes that the state and CMS had determined could not oversee
orderly closure on their own; both homes were closed successfully.
Finally, in the remaining home, the objective changed from bringing the
home into substantial compliance to overseeing orderly closure of the
home when the temporary manager determined that the home was not
financially viable; the sanction was successful in achieving the latter
objective (see enclosure III).[Footnote 38]
In addition to assisting homes with returning to substantial
compliance, state officials told us that the temporary managers also
brought about changes to improve the quality of care in the nursing
homes and to ensure the homes were capable of maintaining substantial
compliance. For example, at four homes the temporary manager was
required to conduct an initial assessment of the home and develop
initiatives to maintain compliance with federal quality requirements.
[Footnote 39] Other examples of actions taken by the temporary managers
included instituting training for nursing home staff, filling staff
positions, implementing resident care plans, updating the homes'
policies and procedures, purchasing and implementing billing software
updates, and identifying needed building improvements. Specifically,
the temporary manager in one home identified that the cooling system
needed to be replaced to ensure resident safety. Some CMS regional
office and state officials told us that the temporary managers
periodically reported on their activities and progress throughout the
duration of temporary management.
Based on responses from officials in the 10 states and seven CMS
regional offices that used federal temporary management from fiscal
years 2003 through 2008 to questions about the use of the sanction, we
identified several factors that influenced the successful use of the
sanction.[Footnote 40]
* Coordination and communication. In part because the sanction's use
required a considerable investment of time and resources, coordination
and frequent communication between the temporary manager, state, and
CMS regional office were important to the sanction's success.
* Cooperation of nursing home owner. Lack of cooperation from the owner
in providing the temporary manager complete control of expenditures,
personnel, and policies at the home impeded the success of the
temporary manager. At the one home that temporary management was unable
to return to substantial compliance, officials told us that the owner
did not grant the temporary manager enough control and was not
committed to improving the quality of care. In this case, the home was
terminated from Medicare and Medicaid and closed.
* Available funding for temporary management. The home's ability to pay
for temporary management or the availability of other funding sources
was important to the successful use of the sanction. In all but two
homes, the home funded temporary management; in one home, funding was
provided by state CMP funds and, in the other, the home's creditor
provided the home with funding to pay for the temporary manager. The
temporary manager's monthly compensation ranged from less than $15,000
to $60,000 for the six homes where officials were able to provide us
with cost information. In addition, officials noted that changes
implemented by the temporary manager, such as building improvements,
advanced billing software, or hiring of staff, were costly for the
home. For example, in one home, the objective of temporary management
changed to overseeing closure of the home after the temporary manager
determined that the home did not have enough funding to pay for changes
required to return the home to compliance.
Although most homes corrected deficiencies in the short term, some
homes continued to have compliance problems in the longer term. Nine of
the 10 homes that returned to substantial compliance while under
temporary management were still participating in the Medicare and
Medicaid programs as of August 2009.[Footnote 41] However, state and
CMS regional officials told us that 5 homes continued to have problems
after the conclusion of temporary management. For example, 1 of the 5
homes was selected to participate in the SFF Program, and for another
home the state used its own temporary management sanction within 2
years after the conclusion of federal temporary management.
Our analysis of CMS deficiency data found that four of the nine homes
still participating in Medicare and Medicaid as of August 2009 had been
cited with at least one immediate jeopardy level (J-L) deficiency since
temporary management was used.[Footnote 42] In addition, four of the
nine homes where temporary management concluded at least 2 years prior
to August 2009 had one or two stars (much below or below average) in
CMS's Five-Star Quality Rating System.[Footnote 43] Three homes had
either three or four stars (about average or above average) (see
enclosure III).[Footnote 44]
Officials Identified Obstacles to the Sanction's Use and Suggested
Lists of Qualified Temporary Managers and Additional Information to
Address Them:
Officials from the 46 states and seven CMS regional offices that
provided us with information identified three key obstacles to the use
of federal temporary management and suggested ways to address some of
the obstacles.
Officials Identified Three Key Obstacles to the Sanction--Time
Constraints, Lack of Qualified Temporary Managers, and Inadequate
Funding:
The three obstacles most frequently identified by state and CMS
regional officials to using federal temporary management were time
constraints, lack of qualified temporary managers, and inadequate
funding (see table 2).
Table 2: Most Frequently Identified Obstacles to Using the Federal
Temporary Management Sanction:
Obstacle: Not enough time to find a temporary manager and remove
immediate jeopardy within 23 days;
Number of states that identified this obstacle: 24;
Number of CMS regional offices that identified this obstacle: 5.
Obstacle: Lack of qualified or experienced temporary managers;
Number of states that identified this obstacle: 23;
Number of CMS regional offices that identified this obstacle: 4.
Obstacle: Home lacks adequate funding to pay for temporary manager;
Number of states that identified this obstacle: 20;
Number of CMS regional offices that identified this obstacle: 5.
Obstacle: Use state alternative sanction;
Number of states that identified this obstacle: 15;
Number of CMS regional offices that identified this obstacle: 1.
Obstacle: Prefer to allow home to come into compliance on its own;
Number of states that identified this obstacle: 12;
Number of CMS regional offices that identified this obstacle: 0.
Obstacle: Uncertainty about when to use the sanction or what to expect
from temporary manager;
Number of states that identified this obstacle: 12;
Number of CMS regional offices that identified this obstacle: 0.
Source: GAO.
Note: Data are responses to GAO questions from officials from 46 states
and seven CMS regional offices.
[End of table]
* Time constraints: Within 23 days (1) officials must identify and
place a temporary manager in a home and (2) the temporary manager must
remove the immediate jeopardy or the home will be terminated from
participation in Medicare and Medicaid. Officials from 24 states and
five CMS regional offices indicated that this time frame is short and
therefore makes it difficult to pursue temporary management. For
example, officials from a regional office told us of a case where state
officials recommended using federal temporary management, but it was
already day 19 on the termination timeline and the state did not have a
list of potential temporary managers, so the CMS officials determined
the sanction was not feasible.
* Lack of qualified temporary managers: Officials from 23 states and
four CMS regional offices identified a lack of qualified or experienced
temporary managers as an obstacle to the use of the sanction. Although
CMS guidance recommends that states maintain a list of eligible
temporary managers, officials from 25 states told us they do not, which
could impede their ability to identify qualified temporary managers
when use of the sanction may be appropriate. Officials from 21 states
reported that they do maintain such a list, but only 11 had updated
their list within the last 2 years. A few state officials also
indicated that qualified candidates may not be willing to accept a
temporary manager position because, for example, they are otherwise
employed or do not want the liability associated with managing a poorly
performing home.
* Inadequate funding: Officials from 20 states and five CMS regional
offices reported that homes' lack of adequate funding to pay for
temporary management can be an obstacle to using the sanction. For one
of the homes where federal temporary management was used from fiscal
years 2003 through 2008, the temporary manager was paid from CMP funds
because the home did not have sufficient funding; however, officials
from this state noted there are not enough CMP funds to pay for more
frequent use of temporary management.[Footnote 45]
State and CMS regional officials also identified other obstacles to the
use of federal temporary management such as employing other sanctions
to achieve compliance instead of federal temporary management; having
previously unsuccessful experiences with temporary management; and
investing significant time and resources to use the sanction.
As shown in table 2, officials from 15 states indicated that they used
their state alternative sanctions--state authority to use temporary
management, receivership, or trusteeship. Overall, however, state
officials' responses indicated that the substitution of a state
alternative for the federal sanction is limited. Specifically,
officials from 17 of 32 states with state alternative sanctions to
federal temporary management did not use their alternatives from fiscal
years 2003 through 2008, and officials from 13 states reported not
having such alternative sanctions.[Footnote 46] Officials from only 2
states--California and Texas--reported using the alternatives an
average of more than three times a year during the 6-year period.
[Footnote 47]
Officials from five states indicated that both the federal temporary
management sanction and their state alternative sanctions were used
from fiscal years 2003 through 2008, suggesting that the federal
sanction might be appropriate in certain situations while the state
alternatives might work better in others. For example, a Texas official
told us that when using the alternative sanction the state can (1) act
more quickly because it does not have to coordinate with the nursing
home, and (2) use state funds to pay for the sanction. In contrast to
the federal sanction, a nursing home may not refuse the Texas
alternative sanction. In the one case in which Texas used the federal
temporary management sanction during the period we studied, officials
reported that they were unable to use the preferred state alternative
because the home did not meet criteria required to obtain a court order
to appoint a trustee to oversee the home.
Officials Identified Lists of Qualified Temporary Managers and
Additional Information on the Sanction's Use as Ways to Address
Obstacles:
State and CMS regional officials identified ways to address some
obstacles and facilitate the use of the federal temporary management
sanction. First, to address the lack of qualified or experienced
candidates to serve as temporary managers, officials from 9 states and
three CMS regional offices suggested that CMS or states could develop a
list of candidates that could be available when temporary management
was an appropriate sanction. Second, officials from 12 states reported
being uncertain about when to use the sanction or what to expect from a
temporary manager, or both. To address this uncertainty, officials from
7 states and two CMS regional offices suggested that CMS could provide
more specific information regarding when or how to use it effectively.
Officials from 1 state specifically noted that before considering the
use of the sanction in their state they would find it helpful to have
information from CMS on best practices so that they would know how the
sanction has worked in other instances.
In addition, officials from 4 states and two CMS regional offices
suggested that alternative or additional funding sources for temporary
management could facilitate the sanction's use. Officials from 2 states
and one CMS regional office also suggested that CMS could establish an
approach to help ensure the longer-term compliance of homes where
temporary management was used, such as allowing the temporary manager
to continue for some time after a home returns to substantial
compliance or implementing an automatic reactivation of temporary
management if the home does not maintain substantial compliance over
the 2 years following the sanction. Although officials from 24 states
and five CMS regional offices identified the short 23-day time frame to
remove immediate jeopardy as an obstacle to the use of federal
temporary management, officials from only 1 state and one CMS regional
office recommended extending the time frame, which could lengthen the
period of time residents are exposed to the risk of death or serious
injury.
Conclusions:
Infrequent use of federal temporary management appears to be the result
of (1) the availability of other sanctions, such as CMPs, that states
and regional offices deem more appropriate in certain situations, and
(2) state and regional office determinations that many homes can
address immediate jeopardy deficiencies without the assistance of a
temporary manager. Nonetheless, officials identified several obstacles
that may prevent the use of temporary management when appropriate or
factors that influence the sanction's success when it is used. Although
officials identified the short 23-day termination time frame as an
obstacle to using federal temporary management, extending the time
frame could result in nursing homes taking more time to abate immediate
jeopardy deficiencies, thereby placing nursing home residents at risk
for longer periods.
Other obstacles that officials identified may be more easily addressed,
such as a lack of qualified temporary managers and insufficient
information illustrating best practices, including when or how to use
temporary management. Though addressing these obstacles could increase
use of the sanction when appropriate or its short-term effectiveness,
the longer-term effectiveness of the sanction is difficult to assess
because 5 of the 9 homes that underwent temporary management and
remained open have not been able to consistently maintain compliance.
Such longer-term compliance problems suggest the need for enhanced
oversight.
Recommendations for Executive Action:
To address obstacles to the use of the federal temporary management
sanction, we recommend that the Administrator of CMS work with states
to implement the following two actions:
* Create and maintain a list or lists of qualified temporary managers
on either a regional or national basis.
* Develop additional information that identifies best practices for
states and regional offices, including when and how to use the
sanction, the essential qualifications for temporary managers, and
alternative funding sources available for temporary management, such as
CMP funds.
To help ensure the longer-term compliance of nursing homes that have
successfully returned to substantial compliance under temporary
management, we recommend that the Administrator of CMS develop guidance
for states to enhance their oversight of such homes, such as
implementing reactivation of temporary management if the home does not
maintain substantial compliance over the 2 years following the
conclusion of the sanction.
Agency and Other External Comments and Our Evaluation:
We provided a draft of this report to the Department of Health and
Human Services and AHFSA for comment.[Footnote 48] In its written
comments, CMS said that our study added value to the important public
policy discussions regarding the use of temporary management, an
important tool that states can recommend and CMS can impose in
situations of immediate jeopardy. While CMS endorsed the spirit of our
recommendations, the agency indicated that it did not plan to implement
all of them. Specifically, CMS agreed with one recommendation,
indicated that it would explore alternatives to a second
recommendation, and noted that it did not plan to implement the third
recommendation. CMS's comments are reproduced in enclosure IV. We also
received written comments from AHFSA, which agreed with one
recommendation but did not comment on whether it agreed with the other
two. CMS and AHFSA also provided additional information, which we
summarize below.
CMS agreed with our recommendation to develop additional information
that identifies best practices for states and regional offices to
assist in their use of temporary management. AHFSA agreed that there
was a need for CMS to provide clearer information to states regarding
the process involved with using temporary management; additionally,
AHFSA commented that one state suggested CMS should develop performance
measures or benchmarks for nursing homes that, if not met, would
require the use of a temporary manager.
CMS indicated that it intended to broaden the scope of our
recommendation to develop guidance for states to enhance the agency's
longer-term oversight of nursing homes that have successfully returned
to substantial compliance under temporary management. Specifically, CMS
stated it would establish a state-federal workgroup to examine the full
array of potential sanctions together, rather than just focusing on
temporary management. While our recommendation was limited to the scope
of our study--specifically, the use of temporary management--we believe
that the agency's actions have the potential to fulfill the intent of
our recommendation if they result in an enhanced focus on ensuring that
nursing homes remain in compliance.
CMS commented that it did not plan to implement our recommendation that
it work with states to create and maintain a list or lists of qualified
temporary managers on either a regional or national basis, but the
agency stated that it would form a state-federal workgroup to explore
this recommendation. Both CMS and AHFSA noted that maintaining such a
list posed challenges for several reasons, including the resources
required to develop and maintain such a list and differences in state
professional licensure laws. Moreover, CMS commented that the creation
of the infrastructure to maintain and administer a list of temporary
managers presumed that this sanction was both superior to other
sanctions and would be used extensively. Our draft report states that
many state and regional officials told us that the lack of potential
temporary managers was an obstacle to using the sanction. Because of
the availability of other sanctions that states and regional offices
deem more appropriate based on the circumstances and because of the
short 23-day time frame to abate immediate jeopardy deficiencies, the
availability of a list of temporary managers may not result in
significantly greater use of the sanction. Lack of an up-to-date list,
however, is clearly an obstacle to the sanction's use when it may be
appropriate, an obstacle that is compounded by the short 23-day time
frame. As a result, we maintain that the full potential of what CMS
characterizes as an important tool will not be fully realized without
the development and maintenance of such lists.
AHFSA commented that state laws may vary regarding state authority and
procedures involving temporary management. During the course of our
study, we asked states whether they had an alternative sanction to
federal temporary management and whether they used this alternative
from fiscal years 2003 through 2008; we did not review specific state
authorities or state procedures for implementing temporary management.
AHFSA also noted that one state suggested that CMS conduct a study of
the effectiveness of each available federal sanction in ensuring long-
term compliance. As noted in our draft report and in CMS's comments,
the states and regional offices often use other sanctions in addition
to temporary management, such as CMPs and DPNAs. As a result, we
believe that it would be difficult to isolate the effectiveness of
individual sanctions in ensuring nursing homes' compliance with federal
quality requirements.
As agreed with your offices, unless you publicly announce the contents
of this report earlier, we plan no further distribution until 30 days
after its issue date. At that time, we will send copies to the
Administrator of CMS and appropriate congressional committees. The
report will also be available at no charge on GAO's Web site at
[hyperlink, http://www.gao.gov]. If you or your staff have any
questions regarding this report, please contact me at (202) 512-7114 or
dickenj@gao.gov. Contact points for our Offices of Congressional
Relations and Public Affairs may be found on the last page of this
report. Walter Ochinko, Assistant Director; Rebecca Abela; Kaycee M.
Glavich; and Elizabeth T. Morrison were major contributors to this
report.
Signed by:
John E. Dicken:
Director, Health Care:
Enclosures - 4:
List of Requesters:
The Honorable Herb Kohl:
Chairman:
Special Committee on Aging:
United States Senate:
The Honorable Charles E. Grassley:
Ranking Member:
Committee on Finance:
United States Senate:
The Honorable Henry A. Waxman:
Chairman:
Committee on Energy and Commerce:
House of Representatives:
The Honorable Pete Stark:
Chairman:
Subcommittee on Health:
Committee on Ways and Means:
House of Representatives:
The Honorable Jan Schakowsky:
House of Representatives:
[End of section]
Enclosure I: Six Nursing Homes Changed Ownership during or after
Temporary Management, but Did Not Necessarily Improve; Obstacles to
Such Changes May Be Difficult for CMS to Influence:
State officials reported that 6 of the 14 nursing homes that underwent
federal temporary management from fiscal years 2003 through 2008
changed ownership either close to the time of or after the sanction's
use.[Footnote 49] Specifically, a change in ownership occurred during
or shortly after use of temporary management in 4 of the 6 homes (see
enclosure III). In all 4 homes, the temporary manager returned the home
to substantial compliance and oversaw transition of the change in
ownership or remained in place after the change in ownership occurred.
At the remaining 2 homes, state officials told us a change in ownership
occurred several months or years after the conclusion of temporary
management. In 1 of these 2 homes, state officials told us that the
home sought a change in ownership during temporary management, but was
unable to find a buyer due to an asking price that was higher than
potential buyers were willing to pay. The owner sold the home after the
state license was revoked and the home reopened under new ownership.
State officials told us that if a nursing home's owner is unwilling to
correct or is incapable of correcting immediate jeopardy or other
serious deficiencies, a change in ownership may help return a home to
compliance and avoid termination. However, a new owner does not
necessarily guarantee improvement in the home. Three of the six homes
under temporary management from fiscal years 2003 through 2008 that
underwent a change in ownership continued to have longer-term
compliance problems. Specifically, one of the homes was selected to
participate in the Special Focus Facility (SFF) program around the time
of the change in ownership, and each of the three homes had one or two
stars (much below or below average) in the Centers for Medicare &
Medicaid's (CMS) Five-Star Quality Rating System as of August 2009.
[Footnote 50]
State officials primarily identified two obstacles to changing a
nursing home's ownership once temporary management has been used, both
of which would be difficult for CMS to influence. First, officials
noted that when a home subject to temporary management is not
financially viable, it is not attractive to potential purchasers.
Although this obstacle may be difficult for CMS to address, officials
from one state that used the federal temporary management sanction
noted that they forced the owner of a home with a high asking price
that was unable to find a purchaser to lower the price and ultimately a
change in ownership occurred. The second obstacle identified--not
enough time to find a new owner who can return the home to compliance
before termination--is similar to an obstacle that officials cited to
imposing federal temporary management. Extending the termination time
frame to address this obstacle could lengthen the period of time
residents are exposed to the risk of death or serious injury.
[End of section]
Enclosure II: Information on Nursing Homes in Which Federal Temporary
Management Was Used, Fiscal Years 2003 through 2008:
Nursing home: 1;
State[A]: California;
Number of certified beds[B]: 62;
Ownership type: For-profit;
Dates of temporary management: 9/2004-1/2005;
Part of a nursing home chain[C]: Yes.
Nursing home: 2;
State[A]: Colorado;
Number of certified beds[B]: 180;
Ownership type: Government;
Dates of temporary management: 12/2003-3/2004;
Part of a nursing home chain[C]: No.
Nursing home: 3;
State[A]: Colorado;
Number of certified beds[B]: 33;
Ownership type: For-profit;
Dates of temporary management: 9/2007-10/2007;
Part of a nursing home chain[C]: No.
Nursing home: 4;
State[A]: Colorado;
Number of certified beds[B]: 120;
Ownership type: For-profit;
Dates of temporary management: 3/2008-6/2008;
Part of a nursing home chain[C]: No.
Nursing home: 5;
State[A]: Connecticut;
Number of certified beds[B]: 130;
Ownership type: For-profit;
Dates of temporary management: 2/2004-12/2004;
Part of a nursing home chain[C]: No.
Nursing home: 6;
State[A]: Connecticut;
Number of certified beds[B]: 330;
Ownership type: For-profit;
Dates of temporary management: 5/2005-4/2006[D];
Part of a nursing home chain[C]: No.
Nursing home: 7;
State[A]: Maine;
Number of certified beds[B]: 50;
Ownership type: For-profit;
Dates of temporary management: 8/2006-12/2007;
Part of a nursing home chain[C]: No.
Nursing home: 8[E];
State[A]: Michigan;
Number of certified beds[B]: 62;
Ownership type: For-profit;
Dates of temporary management: 4/2005-4/2005;
Part of a nursing home chain[C]: Yes[F].
Nursing home: 9;
State[A]: Michigan;
Number of certified beds[B]: 142;
Ownership type: For-profit;
Dates of temporary management: 6/2007-7/2007;
Part of a nursing home chain[C]: Yes[F].
Nursing home: 10;
State[A]: New Jersey;
Number of certified beds[B]: 180;
Ownership type: Nonprofit;
Dates of temporary management: 10/2002-[G];
Part of a nursing home chain[C]: No.
Nursing home: 11;
State[A]: South Dakota;
Number of certified beds[B]: 108;
Ownership type: For-profit;
Dates of temporary management: 10/2005-2/2006;
Part of a nursing home chain[C]: No.
Nursing home: 12;
State[A]: Tennessee;
Number of certified beds[B]: 122;
Ownership type: For-profit;
Dates of temporary management: 4/2008-1/2009;
Part of a nursing home chain[C]: No.
Nursing home: 13;
State[A]: Texas;
Number of certified beds[B]: 210;
Ownership type: For-profit;
Dates of temporary management: 2/2006-1/2007;
Part of a nursing home chain[C]: Yes.
Nursing home: 14;
State[A]: Vermont;
Number of certified beds[B]: 56;
Ownership type: Nonprofit;
Dates of temporary management: 4/2004-10/2004;
Part of a nursing home chain[C]: No.
Source: Centers for Medicare & Medicaid Services' (CMS) On-line Survey,
Certification, and Reporting and Providing Data Quickly systems, and
state and CMS regional officials.
[A] These states are located in the Atlanta, Boston, Chicago, Dallas,
Denver, New York, and San Francisco CMS regions.
[B] As of most recent survey. For homes that have closed, this is the
survey prior to closure.
[C] Indicates whether home was part of a nursing home chain at the time
temporary management was used. Nursing home chains have two or more
homes under one owner.
[D] Estimate of duration of temporary management based on responses
from state officials.
[E] The nursing home only participated in Medicaid, and the state
Medicaid agency used the sanction.
[F] These nursing homes had the same owner.
[G] Data on duration of temporary management were not available.
[End of table]
[End of section]
Enclosure III: Nursing Home Compliance History and the Objectives and
Outcomes of the Use of Federal Temporary Management, Fiscal Years 2003
through 2008:
Nursing home: California;
Prior to temporary management: Compliance history[B] (number of
deficiencies cited):
Potential Harm (D-F), 3-year survey history: 64;
Potential Harm (D-F), Survey(s) that led to temporary management: 0;
Actual Harm (G-I), 3-year survey history: 2;
Actual Harm (G-I), Survey(s) that led to temporary management: 0;
Immediate Jeopardy (J-L), 3-year survey history: 0;
Immediate Jeopardy (J-L), Survey(s) that led to temporary management:
2;
Other events: None;
Temporary management[A]: Imposed Sept. 2004 for 5 months; home closed
Jan. 2550;
Objective: Objective changed;
Outcome: Close home.
Nursing home: Colorado;
Prior to temporary management: Compliance history[B] (number of
deficiencies cited):
Potential Harm (D-F), 3-year survey history: N/A;
Potential Harm (D-F), Survey(s) that led to temporary management: 8;
Actual Harm (G-I), 3-year survey history: N/A;
Actual Harm (G-I), Survey(s) that led to temporary management: 4;
Immediate Jeopardy (J-L), 3-year survey history: N/A[D];
Immediate Jeopardy (J-L), Survey(s) that led to temporary management:
1;
Other events: None;
Temporary management[A]: Imposed Dec. 2003 for 2.5 months;
Objective: Return home to compliance;
Outcome: Return home to compliance;
Post-temporary management:
Other events: None;
Five-star quality rating[C]: 4 stars.
Nursing home: Colorado;
Prior to temporary management: Compliance history[B] (number of
deficiencies cited):
Potential Harm (D-F), 3-year survey history: 32;
Potential Harm (D-F), Survey(s) that led to temporary management: 4;
Actual Harm (G-I), 3-year survey history: 6;
Actual Harm (G-I), Survey(s) that led to temporary management: 0;
Immediate Jeopardy (J-L), 3-year survey history: 1;
Immediate Jeopardy (J-L), Survey(s) that led to temporary management:
1;
Other events: None;
Temporary management[A]: Imposed Sept. 2007 for 1 month;
Objective: Return home to compliance;
Outcome: Return home to compliance;
Post-temporary management:
Other events: Home closed Apr. 2009.
Nursing home: Colorado;
Prior to temporary management: Compliance history[B] (number of
deficiencies cited):
Potential Harm (D-F), 3-year survey history: 114;
Potential Harm (D-F), Survey(s) that led to temporary management: 0;
Actual Harm (G-I), 3-year survey history: 18;
Actual Harm (G-I), Survey(s) that led to temporary management: 0;
Immediate Jeopardy (J-L), 3-year survey history: 2;
Immediate Jeopardy (J-L), Survey(s) that led to temporary management:
1;
Other events: None;
Temporary management[A]: Imposed Mar. 2008 for 3 months; home closed
June 2008;
Objective: Return home to compliance;
Outcome: Close Home.
Nursing home: Connecticut;
Prior to temporary management: Compliance history[B] (number of
deficiencies cited):
Potential Harm (D-F), 3-year survey history: 36;
Potential Harm (D-F), Survey(s) that led to temporary management: 16;
Actual Harm (G-I), 3-year survey history: 10;
Actual Harm (G-I), Survey(s) that led to temporary management: 18;
Immediate Jeopardy (J-L), 3-year survey history: 0;
Immediate Jeopardy (J-L), Survey(s) that led to temporary management:
9;
Other events: None;
Temporary management[A]: Imposed Feb. 2004 for 10.5 months; change in
ownership occurred Dec. 2004;
Objective: Return home to compliance;
Outcome: Return home to compliance;
Post-temporary management:
Other events: None;
Five-star quality rating[C]: 4 stars.
Nursing home: Connecticut;
Prior to temporary management: Compliance history[B] (number of
deficiencies cited):
Potential Harm (D-F), 3-year survey history: 76;
Potential Harm (D-F), Survey(s) that led to temporary management: 7;
Actual Harm (G-I), 3-year survey history: 20;
Actual Harm (G-I), Survey(s) that led to temporary management: 4;
Immediate Jeopardy (J-L), 3-year survey history: 0;
Immediate Jeopardy (J-L), Survey(s) that led to temporary management:
0;
Other events: In Special Focus Facility program (SFF);
Temporary management[A]: Imposed May 2005 for 10.5 months;
Objective: Return home to compliance;
Outcome: Return home to compliance;
Post-temporary management:
Other events: None;
Five-star quality rating[C]: 3 stars.
Nursing home: Maine;
Prior to temporary management: Compliance history[B] (number of
deficiencies cited):
Potential Harm (D-F), 3-year survey history: 62;
Potential Harm (D-F), Survey(s) that led to temporary management: 18;
Actual Harm (G-I), 3-year survey history: 10;
Actual Harm (G-I), Survey(s) that led to temporary management: 4;
Immediate Jeopardy (J-L), 3-year survey history: 1;
Immediate Jeopardy (J-L), Survey(s) that led to temporary management:
1;
Other events: In Special Focus Facility program (SFF);
Temporary management[A]: Imposed Aug. 2006 for 16 months; change in
ownership occurred Dec. 2006;
Objective: Return home to compliance;
Outcome: Return home to compliance;
Post-temporary management:
Other events: None;
Five-star quality rating[C]: Not included[E].
Nursing home: Michigan;
Prior to temporary management: Compliance history[B] (number of
deficiencies cited):
Potential Harm (D-F), 3-year survey history: 41;
Potential Harm (D-F), Survey(s) that led to temporary management: 16;
Actual Harm (G-I), 3-year survey history: 5;
Actual Harm (G-I), Survey(s) that led to temporary management: 4;
Immediate Jeopardy (J-L), 3-year survey history: 4;
Immediate Jeopardy (J-L), Survey(s) that led to temporary management:
0;
Other events: In Special Focus Facility program (SFF);
Temporary management[A]: Imposed Apr. 2005 for 0.5 months; home closed
Apr. 2005;
Objective: Close home;
Outcome: Close home.
Nursing home: Michigan;
Prior to temporary management: Compliance history[B] (number of
deficiencies cited):
Potential Harm (D-F), 3-year survey history: 43;
Potential Harm (D-F), Survey(s) that led to temporary management: 19;
Actual Harm (G-I), 3-year survey history: 4;
Actual Harm (G-I), Survey(s) that led to temporary management: 1;
Immediate Jeopardy (J-L), 3-year survey history: 0;
Immediate Jeopardy (J-L), Survey(s) that led to temporary management:
5;
Other events: None;
Temporary management[A]: Imposed June 2007 for 1 month; home closed
June 2007;
Objective: Close home;
Outcome: Close home.
Nursing home: New Jersey;
Prior to temporary management: Compliance history[B] (number of
deficiencies cited):
Potential Harm (D-F), 3-year survey history: 25;
Potential Harm (D-F), Survey(s) that led to temporary management: 9;
Actual Harm (G-I), 3-year survey history: 1;
Actual Harm (G-I), Survey(s) that led to temporary management: 0;
Immediate Jeopardy (J-L), 3-year survey history: 0;
Immediate Jeopardy (J-L), Survey(s) that led to temporary management:
3.
Other events: None;
Temporary management[A]: Imposed Oct. 2002[F];
Objective: Return home to compliance;
Outcome: Return home to compliance;
Post-temporary management:
Other events: Change in ownership 2005; placed in SFF Jan. 2005;
Five-star quality rating[C]: 2 stars.
Nursing home: South Dakota;
Prior to temporary management: Compliance history[B] (number of
deficiencies cited):
Potential Harm (D-F), 3-year survey history: 29;
Potential Harm (D-F), Survey(s) that led to temporary management: 30;
Actual Harm (G-I), 3-year survey history: 10;
Actual Harm (G-I), Survey(s) that led to temporary management: 16;
Immediate Jeopardy (J-L), 3-year survey history: 0;
Immediate Jeopardy (J-L), Survey(s) that led to temporary management:
2;
Other events: In Special Focus Facility program (SFF);
Temporary management[A]: Imposed Oct. 2005 for 4.5 months;
Objective: Return home to compliance;
Outcome: Return home to compliance;
Post-temporary management:
Other events: Change in ownership Dec. 2006;
Five-star quality rating[C]: 2 stars;
Nursing home: Tennessee;
Prior to temporary management: Compliance history[B] (number of
deficiencies cited):
Potential Harm (D-F), 3-year survey history: 29;
Potential Harm (D-F), Survey(s) that led to temporary management: 22;
Actual Harm (G-I), 3-year survey history: 0;
Actual Harm (G-I), Survey(s) that led to temporary management: 9;
Immediate Jeopardy (J-L), 3-year survey history: 0;
Immediate Jeopardy (J-L), Survey(s) that led to temporary management:
44;
Other events: None;
Temporary management[A]: Imposed Apr. 2008 for 9 months; ended with
change in ownership Jan. 2009;
Objective: Return home to compliance;
Outcome: Return home to compliance;
Post-temporary management:
Other events: None;
Five-star quality rating[C]: Not included[E].
Nursing home: Texas;
Prior to temporary management: Compliance history[B] (number of
deficiencies cited):
Potential Harm (D-F), 3-year survey history: 64;
Potential Harm (D-F), Survey(s) that led to temporary management: 3;
Actual Harm (G-I), 3-year survey history: 9;
Actual Harm (G-I), Survey(s) that led to temporary management: 0;
Immediate Jeopardy (J-L), 3-year survey history: 0;
Immediate Jeopardy (J-L), Survey(s) that led to temporary management:
2[G];
Other events: None;
Temporary management[A]: Imposed Feb. 2006 for 10.5 months; ended with
change in ownership Jan. 2007;
Objective: Return home to compliance;
Outcome: Return home to compliance;
Post-temporary management:
Other events: None;
Five-star quality rating[C]: 1 star[H].
Nursing home: Vermont;
Prior to temporary management: Compliance history[B] (number of
deficiencies cited):
Potential Harm (D-F), 3-year survey history: 21;
Potential Harm (D-F), Survey(s) that led to temporary management: 9;
Actual Harm (G-I), 3-year survey history: 2;
Actual Harm (G-I), Survey(s) that led to temporary management: 5;
Immediate Jeopardy (J-L), 3-year survey history: 0;
Immediate Jeopardy (J-L), Survey(s) that led to temporary management:
0[I];
Other events: None;
Temporary management[A]: Imposed Apr. 2004 for 6 months;
Objective: Return home to compliance;
Outcome: Return home to compliance;
Post-temporary management:
Other events: State temporary management imposed Jan. 2006;
Five-star quality rating[C]: 2 stars.
Sources: GAO analysis of CMS OSCAR system, PDQ, Nursing Home Compare,
and CMS regional office and state officials.
[A] Outcome of temporary management is in the short term.
[B] Three-year compliance history does not include the survey or
surveys that led to temporary management.
[C] In December 2008, the Centers for Medicare & Medicaid Services
(CMS) began publishing the results from its Five-Star Quality Rating
System to help consumers compare nursing homes. Every nursing home in
the United States is rated--primarily based on the home's compliance
history--with one (much below average), two (below average), three
(about average), four (above average), or five (much above average)
stars. Ratings presented in the figure are as of August 2009; if a
nursing home closed prior to that date or the rating included at least
two surveys that occurred during temporary management, it does not have
a rating.
[D] Compliance history data prior to imposition of temporary management
are not available for 1 of the 14 homes--home number 2--because
temporary management was used during the same year the home began
participating in Medicare and Medicaid.
[E] We did not report the rating for this home because the results from
at least two surveys that occurred prior to temporary management or
while temporary management was in place were included in the
calculation of this rating.
[F] Data on duration of temporary management were not available.
[G] Includes two surveys conducted immediately prior to temporary
management. State officials told us they used these surveys as the
basis for recommending temporary management.
[H] CMS's calculation of this home's rating included results from
complaint investigations that occurred while temporary management was
in place.
[I] Includes two surveys conducted immediately prior to temporary
management because they were conducted within 4 days of each other and
both led to imposition of temporary management.
[End of table]
[End of section]
Enclosure IV: Comments from the Centers for Medicare & Medicaid
Services:
Department Of Health & Human Services:
Office Of The Secretary:
Assistant Secretary for Legislation:
Washington, DC 20201:
November 5, 2009:
John E. Dicken:
Director, Health Care:
Government Accountability Office:
441 G Street NW:
Washington, DC 20548:
Dear Mr. Dicken:
Enclosed are the Department's comments on the U.S. Government
Accountability Office's (GAO) draft report entitled: "Nursing Homes:
Opportunities Exist to Facilitate the Use of the Temporary Management
Sanction" (GAO-10-37R).
The Department appreciates the opportunity to review and comment on
this report before its publication.
Sincerely,
Signed by:
Andrea Palm:
Acting Assistant Secretary for Legislation:
Enclosure:
[End of letter]
Department Of Health & Human Services:
Centers for Medicare & Medicaid Services:
Administrator:
Washington, DC 20201:
Date: November 5, 2009:
To: Andrea Palm:
Acting Assistant Secretary for Legislation:
From: [Signed by] Charlene Frizzera:
Acting Administrator:
Subject: Government Accountability Office (GAO) Draft Report "Nursing
Homes: Opportunities Exist to Facilitate the Use of the Temporary
Management Sanction" (GAO-10-37R):
The Centers for Medicare & Medicaid Services (CMS) appreciates the
opportunity to review and comment on the above-mentioned draft report.
The GAO was asked to gather information as to why the temporary
management sanction has been used infrequently to address nursing home
quality problems. The GAO focused primarily on two areas:
1. CMS and States' experience with the use of temporary management and
its effectiveness in achieving compliance in the short and longer term;
and;
2. Obstacles to the use of Federal temporary management and how such
obstacles could be addressed.
We believe that the GAO study adds value to the important public policy
discussions regarding the use of temporary management, one of several
remedies provided in the Omnibus Budget Reconciliation Act of 1987
(Pub. Law 100-203). We believe that temporary management is an
important tool that States can recommend and CMS can impose in
situations of immediate jeopardy (IJ).
The IJ citations in nursing homes are relatively infrequent. For
example, the percentage of nursing homes cited for IJ deficiencies
ranged from 2.2 percent in 2003 to 2.4 percent in 2006, with a high of
2.6 percent in 2005. Nonetheless, when we identify IJ we take the
situation seriously and require that the IJ be remedied within 23 days.
It is in this context that temporary managers are used.
In addition to temporary management, CMS makes extensive use of civil
monetary penalties (CMPs), denial of payment for new admissions, and
termination from Medicare when serious problems persist unremedied. In
recent years, we have also taken additional steps to identify those
nursing homes most in need of concentrated attention from CMS. Examples
include CMS' Special Focus Facility initiative, and the Nursing Home
Five-Star Quality Rating System that is featured on CMS' Nursing Home
Compare Website. In 2008, CMS also began to require each Quality
Improvement Organization to work with at least one special focus
facility nursing home in each State.
The GAO found that infrequent use of temporary management appears to be
the result of (1) the availability of other sanctions such as CMPs that
States and regional offices deem more appropriate in certain
situations; and (2) their determination that many homes can address IJ
deficiencies without assistance of a temporary manager. Nonetheless,
the GAO made a number of suggestions that might result in greater use
of temporary management. We endorse the spirit of the GAO
recommendations, but do not fully agree with all of the specific
recommendations. We offer the following more detailed responses to the
GAO recommendations.
GAO Recommendation 1: Federal List of Temporary Managers:
To address obstacles to the use of the Federal temporary Management
sanction, create and maintain a list or lists of qualified temporary
managers on either a regional or national basis.
CMS Response:
We do not plan to implement this recommendation, but will form a State-
Federal workgroup to explore the recommendations in this report more
fully. It is not simply the creation of such a list that is at issue,
but (a) the constant updating of a list of "at-the-ready" potential
temporary managers (b) matched to particular geographical areas with
(c) particular skill sets that may be needed for (d) a very diverse
array of nursing facilities for a (e) sanction (temporary management)
that may remain infrequently used even with such a national list.
Further, such a system presumes the presence of a Federal
infrastructure to maintain and administer a national temporary
management program that may be of lower value than alternative uses of
staff resources devoted to nursing home oversight and enforcement.
It is also unclear from the GAO analysis whether the use of temporary
management is superior or inferior to other forms of enforcement, such
as denial of payment for new admissions or CMPs. In fact, it is
probable that this question cannot be answered in the abstract, but
must be determined based on the specific facts pertinent to each
nursing home's situation. We therefore do not consider it prudent at
this time to develop a national temporary management infrastructure
based on the presumption that the temporary management remedy is both
superior to other remedies and will be extensively used.
Finally, we continue to believe that the most effective venue for
maintenance of potential temporary manager lists is at the State level.
States generally have licensure and other sanction authority beyond-
Federal requirements, maintain sanction system's for State licensure
violations, and typically have additional oversight responsibilities
for providers beyond nursing homes for which temporary managers might
be used (e.g., oversight of assisted living facilities). Such State
authorities and responsibilities create economies of scale and
synergies that make maintenance of lists of local experts at the State
level more feasible.
GAO Recommendation 2: Bet Practices for Use of Temporary Management
To address obstacles to the use of the Federal temporary management
sanction, develop additional information that identifies best practices
for States and regional offices, including when and how to use the
sanction, the essential qualifications for temporary managers, and
alternative funding sources available for temporary management, such as
CMP funds.
CMS Response:
We agree with the recommendation. CMS will seek State best practices,
evaluate, and develop additional information to assist States• and
regional offices in using temporary management. However, the timeline
for this activity would need to be determined based on current and
anticipated workloads.
GAO Recommendation 3: Develop Guidance for States to Enhance Oversight
To help ensure the longer-term compliance of nursing homes that have
successfully returned to substantial compliance under temporary
management, we recommend that the Administrator of CMS develop guidance
for States to enhance their oversight of such homes, such as
implementing reactivation of temporary management if the home does not
maintain substantial compliance over the 2 years following the
conclusion of the sanction.
CMS Response:
We will explore alternatives to this recommendation in which we
consider the full array of potential remedies together, rather than
temporary management per se. As the GAO report indicates, the
choice of using a temporary management sanction in lieu of other
remedies is typically occasioned by very specific circumstances in the
nursing home. In some cases; for example, it is used to effect an
orderly transition of residents to alternate arrangements prior to
closure of the nursing home. In other cases; the decision to use
temporary management depends on the facility's finances, or an
assessment of the capabilities of the current management team, or other
factors: While the unique circumstances on the ground are likely to be
more important than any general guidance from CMS, we will explore this
topic with a State-Federal workgroup.
We appreciate the GAO's interest in ensuring that nursing homes remain
in compliance with CMS quality of care and safety expectations once the
period of temporary management is ended. This same concern applies to
all situations in which serious violations are found, regardless of
whether temporary management has been applied. We will therefore
explore this issue as well with the State-Federal workgroup.
Other factors not addressed in the GAO recommendations may be important
in helping States make more effective use of temporary management. For
example, the GAO, report found that lack of resources to pay temporary
managers was the third most frequently cited barrier to the use of
temporary managers.[Footnote 51] While CMP resources can be an
important source of such funding, the GAO report correctly observes
that the Medicare portion of CMP revenue is not available for such a
purpose.
Finally, the quality of care in a nursing home depends in part on the
actions of the governing body and owner, as well as management team and
staff. Whenever the actions of owners or operators represent a
significant part of the problem, the use of temporary management has a
significant drawback: temporary management can restore the asset value
of a nursing home only to have the improved asset placed back in the
hands of the same owner or operator that has been party to the decline
in quality. The owner may subsequently sell the business (benefiting
from the restored value) or continue the pattern of action (or non-
action) that gave rise to the problems in the beginning.
These observations suggest that the issue of temporary management is
more appropriately viewed in the larger context of creating the best
fit between CMS enforcement actions and the root causes of poor quality
in a particular nursing home. The best fit will be one that not only
restores compliance in the short term, but improves quality in the long
term. It is conceivable that such a best fit may involve the use of
tools that are not currently in use to any significant extent. These
issues require further study. We believe that CMS' Special Focus Radnor
initiative provides a structured program environment within which we
can gather additional information about the range of situations and
enforcement remedies that should be considered.
[End of section]
Related GAO Products:
Nursing Homes: CMS's Special Focus Facility Methodology Should Better
Target the Most Poorly Performing Homes, Which Tended to Be Chain
Affiliated and For-Profit. [hyperlink,
http://www.gao.gov/products/GAO-09-689]. Washington, D.C.: August 28,
2009.
Medicare and Medicaid Participating Facilities: CMS Needs to Reexamine
Its Approach for Funding State Oversight of Health Care Facilities.
[hyperlink, http://www.gao.gov/products/GAO-09-64]. Washington, D.C.:
February 13, 2009.
Nursing Homes: Federal Monitoring Surveys Demonstrate Continued
Understatement of Serious Care Problems and CMS Oversight Weaknesses.
[hyperlink, http://www.gao.gov/products/GAO-08-517]. Washington, D.C.:
May 9, 2008.
Nursing Home Reform: Continued Attention Is Needed to Improve Quality
of Care in Small but Significant Share of Homes. [hyperlink,
http://www.gao.gov/products/GAO-07-794T]. Washington, D.C.: May 2,
2007.
Nursing Homes: Efforts to Strengthen Federal Enforcement Have Not
Deterred Some Homes from Repeatedly Harming Residents. [hyperlink,
http://www.gao.gov/products/GAO-07-241]. Washington, D.C.: March 26,
2007.
Nursing Homes: Despite Increased Oversight, Challenges Remain in
Ensuring High-Quality Care and Resident Safety. [hyperlink,
http://www.gao.gov/products/GAO-06-117]. Washington, D.C.: December 28,
2005.
Nursing Home Quality: Prevalence of Serious Problems, While Declining,
Reinforces Importance of Enhanced Oversight. [hyperlink,
http://www.gao.gov/products/GAO-03-561]. Washington, D.C.: July 15,
2003.
Nursing Homes: Quality of Care More Related to Staffing than Spending.
[hyperlink, http://www.gao.gov/products/GAO-02-431R]. Washington, D.C.:
June 13, 2002.
Nursing Homes: Sustained Efforts Are Essential to Realize Potential of
the Quality Initiatives. [hyperlink,
http://www.gao.gov/products/GAO/HEHS-00-197]. Washington, D.C.:
September 28, 2000.
Nursing Home Care: Enhanced HCFA Oversight of State Programs Would
Better Ensure Quality. [hyperlink,
http://www.gao.gov/products/GAO/HEHS-00-6]. Washington, D.C.: November
4, 1999.
Nursing Homes: Proposal to Enhance Oversight of Poorly Performing Homes
Has Merit. [hyperlink, http://www.gao.gov/products/GAO/HEHS-99-157].
Washington, D.C.: June 30, 1999.
Nursing Homes: Additional Steps Needed to Strengthen Enforcement of
Federal Quality Standards. [hyperlink,
http://www.gao.gov/products/GAO/HEHS-99-46]. Washington, D.C.: March
18, 1999.
California Nursing Homes: Care Problems Persist Despite Federal and
State Oversight. [hyperlink,
http://www.gao.gov/products/GAO/HEHS-98-202]. Washington, D.C.: July
27, 1998.
[End of section]
Footnotes:
[1] Medicare is the federal health care program for elderly and
disabled people. Medicaid is the joint federal-state health care
financing program for certain categories of low-income individuals.
Medicare covers up to 100 days of skilled nursing home care following a
hospital stay; Medicaid also pays for long-term care services,
including nursing home care.
[2] CMS is an agency within the Department of Health and Human
Services.
[3] PDQ is an online reporting system that provides a variety of
reports using CMS survey data. From fiscal year 1995--the first year
the federal temporary management sanction was available--through fiscal
year 2002, the sanction was used in 11 homes. Because of the likelihood
that information on sanctions used so long ago would be limited, we
focused on those instances in which the sanction was used from fiscal
years 2003 through 2008.
[4] The 10 states that used federal temporary management were
California, Colorado, Connecticut, Maine, Michigan, New Jersey, South
Dakota, Tennessee, Texas, and Vermont. These states are located in the
Atlanta, Boston, Chicago, Dallas, Denver, New York, and San Francisco
CMS regions.
[5] Throughout this report, we refer to state survey agencies,
including the District of Columbia agency, as "states."
[6] One of the 14 homes began participating in Medicare and Medicaid
the same year that temporary management was used, and therefore
compliance history data prior to temporary management were not
available for this home.
[7] One state provided information about its experience using federal
temporary management, but did not provide information about obstacles
to the use of the sanction and how they could be addressed.
[8] Delaware, the District of Columbia, Nevada, and New York did not
respond.
[9] By law, obtaining a state license to operate--by meeting specific
state requirements--is one prerequisite for a home to participate in
Medicare and Medicaid. 42 U.S.C. §§ 1395i-3(d)(2)(A), 1396r(d)(2)(A).
[10] Pub. L. No. 100-203, §§ 4201, 4211, 101 Stat. 1330, 1330-160, 1330-
182 (codified in pertinent part at 42 U.S.C. § 1395i-3 and 42 U.S.C. §
1396r).
[11] Every nursing home receiving Medicare or Medicaid payment must
undergo a standard survey not less than once every 15 months, and the
statewide average interval for these surveys must not exceed 12 months.
[12] As of December 31, 2008, almost 91 percent of nursing homes were
certified to participate in Medicare and Medicaid, about 5 percent were
only certified to participate in Medicare, and about 4 percent were
only certified to participate in Medicaid.
[13] CMS can also impose federal sanctions that the state has not
recommended. Throughout this report, we refer to the imposition and
implementation of a sanction as "use" of the sanction.
[14] Overall, CMPs and DPNAs accounted for about 76 percent of federal
sanctions imposed from fiscal years 2003 through 2008. Terminating a
nursing home eliminates its eligibility to receive Medicare and
Medicaid payments and can result in a home's closure; termination
accounted for less than 1 percent of federal sanctions imposed from
fiscal years 2003 through 2008.
[15] 42 U.S.C. §§ 1395i-3(h), 1396r(h); see 42 C.F.R. § 488.408 (2008).
In the absence of immediate jeopardy, temporary management, another
sanction, or termination may also be used.
[16] See 42 U.S.C. §§ 1395i-3(h)(2)(A), 1396r(h)(3); 42 C.F.R. §
488.410 (2008).
[17] See 42 U.S.C. § 1396r(h)(2)(B)(ii); 42 C.F.R. § 488.406 (c). Homes
must meet certain state-determined criteria for the state to impose a
state alternative sanction.
[18] Throughout this report, we refer to CMS-approved alternative
sanctions or state licensure sanctions as state alternative sanctions.
[19] See 42 U.S.C. §§ 1395i-3(h)(2)(B)(iii), 1396r(h)(3)(C)(iii).
Through the State Operations Manual, CMS provides guidance based on the
statutes to regional offices and states on the use of the federal
temporary management sanction.
[20] The temporary manager's salary must be at least equivalent to the
prevailing annual salary of nursing home administrators in the home's
area including the cost of benefits, prorated for the amount of time
the temporary manager spends in the home.
[21] When CMS appoints a state-recommended temporary manager and a home
agrees, the temporary manager and the home negotiate the terms of
temporary management--such as the temporary manager's authorities,
duties, and compensation.
[22] In the case of a Medicaid-only nursing home, the state Medicaid
agency selects the temporary manager.
[23] CMS decided not to require that temporary managers be licensed
nursing home administrators in order to expand the number of eligible
candidates.
[24] The SFF Program focuses on 136 nursing homes in every state except
Alaska; the number of SFFs per state ranges from 1 to 6 based on the
number of homes in the state. See GAO, Nursing Homes: CMS's Special
Focus Facility Methodology Should Better Target the Most Poorly
Performing Homes, Which Tended to Be Chain Affiliated and For Profit,
[hyperlink, http://www.gao.gov/products/GAO-09-689] (Washington, D.C.:
Aug. 28, 2009).
[25] A two-star rating means a home ranks "below average;" a three-star
rating means "about average;" and a four-star rating means "above
average."
[26] The second component of the five-star quality rating--staffing
levels--is based on nursing homes' reported total nursing hours per
resident day and registered nurse hours per resident day. The third
component is based on nursing home performance on 10 quality-of-care
measures, such as the percentage of high-risk residents who have
pressure sores.
[27] In calculating the compliance history rating, the most recent
survey findings are weighted more than the prior two surveys. The
overall quality rating is capped in two circumstances. First, if a
nursing home's compliance history is one star, then the overall quality
rating cannot exceed two stars. Second, nursing homes currently in the
SFF program have their overall quality rating capped at three stars
even if they have high ratings in individual components.
[28] For the remaining home, officials told us that they used temporary
management solely because of multiple immediate jeopardy deficiencies.
CMS typically uses other federal sanctions before turning to temporary
management.
[29] The three homes where immediate jeopardy was not identified in the
survey that led to temporary management were not subject to the 23-day
termination time frame.
[30] We previously reported that many homes frequently cycle in and out
of compliance; see GAO, Nursing Homes: Efforts to Strengthen Federal
Enforcement Have Not Deterred Some Homes from Repeatedly Harming
Residents, [hyperlink, http://www.gao.gov/products/GAO-07-241]
(Washington, D.C.: Mar. 26, 2007).
[31] The 14 nursing homes in which the sanction was used were located
throughout the United States, mostly for-profit, and generally not part
of a nursing home chain (see enclosure II).
[32] The average includes two homes with a high number of D-L
deficiencies in comparison to the other homes. Excluding these two
homes results in an average of 30 D-L deficiencies during the year
prior to temporary management.
[33] In 6 of the 14 homes, CMS or state officials told us they used
other sanctions, such as a CMP, in addition to federal temporary
management.
[34] States cited about 3,900 nursing homes with immediate jeopardy
level deficiencies from fiscal years 2003 through 2008; temporary
management was used 14 times and termination 163 times in those years.
[35] States also have the option of using a state alternative to
temporary management or other state sanctions if the home has not met
state licensing requirements.
[36] According to PDQ, directed plans of correction were used 1,429
times in fiscal years 2003 through 2008.
[37] In most homes for which information was available, the temporary
manager was an individual employed by a management company. In one
case, a company hired as the temporary manager installed a team that
included a licensed nursing home administrator, a medical director, and
a director of nursing, among others, to manage the home.
[38] The duration of temporary management ranged from less than a month
to about 16 months and averaged about 6 months, with generally shorter
durations for homes where temporary management oversaw closure of the
home. Generally, temporary management ended when either the home was
determined to be in substantial compliance or the home closed.
[39] CMS regional office or state officials were only able to provide
the agreement between the home and the temporary manager for these four
homes.
[40] Officials from three states did not provide us with information
regarding factors that influenced the ability of temporary management
to achieve its objective in part because of the amount of time that had
passed since the sanction was used.
[41] The 10th home closed less than 2 years after the conclusion of
temporary management.
[42] This includes three of the five homes that state and CMS regional
officials identified as having continued problems after the conclusion
of temporary management.
[43] For one of the homes with a one-star rating, the results from
complaint investigations that occurred while temporary management was
in place were included in CMS's calculation of the rating.
[44] We did not report the rating for two of the nine homes because the
results from at least two surveys that occurred prior to temporary
management or while temporary management was in place were included in
CMS's calculations of these ratings.
[45] By law, states receive funds from CMPs collected from Medicaid-
only nursing homes, as well as the Medicaid portion of homes that
participate in both Medicare and Medicaid. These funds must be applied
to the protection of the health or property of residents of homes that
the state or CMS finds deficient, such as payment for the costs of
relocation of residents to other homes or operation of a home pending
correction of deficiencies or closure. See 42 U.S.C §
1396r(h)(2)(A)(ii). There is no requirement in the Social Security Act
that the Medicare portion of CMP funds be used for a specific purpose;
the funds are deposited as miscellaneous receipts into the U.S.
Treasury.
[46] An official from one state did not indicate whether the state had
an alternative sanction to federal temporary management. According to
the state's administrative code, the state had the authority to impose
temporary management in nursing homes that participate in Medicaid;
however, we do not know if the state used this sanction from fiscal
years 2003 through 2008.
[47] In addition, officials from Connecticut reported using the state
alternative sanction several times a year.
[48] AHFSA represents survey agencies from all 51 states. During the
course of our work, we collected information from 47 states. AHFSA
agreed to provide us with consolidated comments on our draft report on
behalf of all states.
[49] A change in a nursing home's ownership can occur at any time,
including when federal temporary management is in place or when a
nursing home is on track to being terminated. When a change in
ownership occurs, the new owner has two alternatives. The new owner can
take over the existing provider agreement and be subject to all the
terms and conditions under which the existing agreement was issued,
including (1) meeting the time frames for correcting deficiencies; (2)
assuming responsibility for any sanctions associated with those
deficiencies, with two exceptions--the new owner is not (a) subject to
the loss of the right to train nurses aides if the nursing home was
under a 2-year restriction from the Nurse Aide Training and Competency
Evaluation Programs, and (b) responsible for money owed to the federal
government due to a determination that the previous owner is personally
guilty of fraud; and (3) complying with applicable health and safety
requirements. Alternatively, the new owner can apply to participate in
Medicare as a new provider and enter into a new provider agreement,
which requires enrolling as any other new applicant and undergoing an
initial certification survey.
[50] A fourth home had four stars (above average) in the Five-Star
Quality Rating System as of August 2009. For the two remaining homes
that underwent changes in ownership, we did not report the five-star
ratings because the results from at least two surveys that occurred
prior to temporary management or while temporary management was in
place were included in the calculations of these ratings.
[51] Table 2, GAO report, questionnaire responses from State survey
agencies.
[End of section]
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