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Federal and State Enforcement of the 1987 Nursing Home Reform Act

Background

The Nursing Home Reform Act of 1987 established quality standards for nursing homes nationwide, established resident rights, and defined the state survey and certification process to enforce the standards (See PPI Fact Sheet Number 84: "The Nursing Home Reform Act of 1987.")

Ten years after the passage of the Nursing Home Reform Act, however, a series of research studies and Senate hearings called attention to serious threats to residents' well-being. These problems were attributed to weaknesses in federal and state survey and enforcement activities.

Nursing Home Quality In California

In 1997, the Senate Committee on Aging, chaired by Senator Charles Grassley, received reports of widespread death and suffering in California nursing homes caused by inadequate care. In response to these reports, the Committee held a hearing on California nursing homes in July 1998.

A General Accounting Office (GAO) report presented at the hearing revealed that, despite the requirements of the Nursing Home Reform Act, weak enforcement put many residents at risk of substandard care. Between 1995 and 1998, state surveyors cited 30 percent of nursing homes in California for violations that put residents in immediate jeopardy or caused actual harm to residents. Another 33 percent of facilities were cited with substandard conditions that caused less serious harm, and another 35 percent had more than minimal deficiencies. Only 2 percent of California facilities were found to have minimal or no deficiencies.

While state surveyors identified widespread serious problems, the report suggested that many other care problems went undetected due to weaknesses in federal and state nursing home oversight. Even when serious problems were identified, enforcement actions often failed to ensure that they were corrected and did not recur.

Although the study focused on California, the findings were indicative of broader problems in the nursing home enforcement system. Based on their findings, GAO recommended strengthening federal and state oversight of nursing homes to better protect residents throughout the country.

The Survey Process Compared With The Alternatives

Also in July 1998, the Health Care Financing Administration (HCFA) published a report that examined the effectiveness of the current survey and certification process and the proposed alternatives of private accreditation and incentives. While the study indicated that the Nursing Home Reform Act of 1987 had resulted in improved resident outcomes, it also concluded that many of the enforcement processes were not working as intended. Despite the flaws in the survey and certification process, however, the study found federal enforcement to be more effective in protecting residents than either private accreditation or incentives.

The 1998 Nursing Home Initiative

Concurrent with the Senate Committee on Aging hearing, the GAOreport on California nursing homes, and the HCFA study, the ClintonAdministration announced the 1998 Nursing Home Initiative. TheInitiative included a series of proposed steps designed to improveenforcement of nursing home quality standards.

To implement the Nursing Home Initiative, HCFA has begun a series of steps to improve nursing home enforcement procedures. These include:

  • Staggering nursing home inspections, with a set number occurring on weekends and evenings;
  • Inspecting more frequently nursing homes that are repeat offenders with serious violations, without decreasing frequency of inspections for other facilities;
  • Enhancing the HCFA review of nursing home surveys conducted by the states;
  • Terminating federal nursing home survey funding to states that fail to perform adequate surveys;
  • Imposing immediate sanctions on nursing homes found guilty of a second offense for violations harming residents; such facilities will not receive a "grace period" allowing them to correct problems and avoid penalties;
  • Allowing states to impose civil monetary penalties for each instance of a serious or chronic violation; and
  • Ensuring that state survey agencies enforce sanctions against nursing homes with serious violations and that sanctions are not lifted until after an onsite visit has verified compliance.

Some states have also implemented their own efforts to improve nursing home quality enforcement.

Funding For Enforcement

State survey, certification, and enforcement activities arefunded through the Medicare and Medicaid programs. The federalgovernment finances 100% of the Medicare budget and 75% of theMedicaid budget for state survey and certification activities.States provide the remaining 25% of the Medicaid survey andcertification budget.

Currently, HCFA distributes federal funds to states based on past state practices and costs, thereby perpetuating low budgets in states that have spent less for survey and certification activities. HCFA is now exploring options for better distribution of future survey and certification funding.

In the meantime, recognizing the increased costs associated with the Nursing Home Initiative, the Administration and Congress have significantly increased the federal Medicare and Medicaid budget for state survey and certification activities. Federal funding grew from $290.2 million in fiscal year 1998 to $310.1 million in 1999, and to $358.7 million in fiscal year 2000.

Nursing Home Quality Nationwide

Following the California study and the announcement of the1998 Nursing Home Initiative, GAO and HCFA conducted additionalresearch that included nursing homes nationwide. The findings werepresented at a series of additional hearings on nursing homequality held by the Senate Committee on Aging in 1999 and 2000.

These reports and hearings confirmed that problems of substandard quality, weak survey procedures, and ineffective enforcement were not limited to California, but were widespread throughout the nation. Key findings include:

  • In 1997 to 1998, over one-fourth of nursing homes nationwide (27%) were cited with violations that caused actual harm to residents or placed them at risk of death or serious injury. Another 43 percent of homes were cited with violations that created a potential for more than minimal harm.
  • During annual surveys, state surveyors often missed significant care problems, such as pressure sores, malnutrition, and dehydration. This problem reflected both weaknesses in state survey methods and the predictable timing of the surveys.
  • Complaints made by residents, family members, or nursing home staff often went uninvestigated for weeks or months. In addition, states frequently had procedures that discouraged the filing of complaints.
  • When serious quality deficiencies were detected, enforcement mechanisms frequently failed to ensure that the problems were corrected and remained corrected.
  • Federal procedures for overseeing state monitoring were limited in their scope and effectiveness.
  • Over half (54%) of nursing homes had fewer than the minimum number of nurse aide time per resident to avoid harming residents. These facilities put residents at increased risk of hospitalization for avoidable causes, pressure sores, and significant weight loss due to inadequate staffing.

As a result of these findings, GAO recommended additional steps to improve enforcement of quality standards, many of which are being addressed by HCFA's new efforts at enforcement.

Effects of the Nursing Home Initiative

In September 2000, the Senate Committee on Aging held ahearing on the outcomes of the Nursing Home Initiatives. A GAOofficial testified at the hearing that the Initiatives had resultedin improvements to state survey and federal oversight procedures,including:

  • Several states have increased, or plan to increase, the number of surveyors;
  • Several states are automating their information systems to track complaints more effectively;
  • States have begun to use new methods introduced by the initiatives to spot serious deficiencies when conducting surveys; and
  • HCFA has made organizational changes to improve nursing home oversight activities and to help ensure consistency across regions.

At the same time, a GAO report noted that many of the new policies and practices have only recently begun and will need time to be fully implemented. Moreover, HCFA is in the process of implementing the Nursing Home Initiative, some parts of which may not be introduced until 2002 or 2003. Hence, it may take a few more years before the full effects of the efforts to improve quality of care can be known.

Conclusion

Inadequate implementation and enforcement have seriouslylimited the effectiveness of the Nursing Home Reform Act of 1987.To address this problem, the Senate Committee on Aging beganholding hearings on nursing home quality, and the ClintonAdministration introduced the 1998 Nursing Home Initiative. Whilethese efforts have resulted in some improvements, more work needsto be done to improve quality in the nation's nursing homes. Asa recent GAO report concludes, "Sustained efforts by HCFA andthe states are essential to realize the potential of the qualityinitiatives" (GAO, 2000).

References

GAO (1998) California Nursing Homes:Care Problems Persist Despite Federal and State Oversight

GAO (1999) Nursing Homes: Additional Steps Needed to Strengthen Enforcement of Federal Quality Standards

GAO (1999) Nursing Homes: Complaint Investigation Processes Often Inadequate to Protect Residents;

GAO (1999) Nursing Home Care: Enhanced HCFA Oversight of State Programs Would Better Ensure Quality

GAO (1999) Nursing Homes: HCFA Initiatives to Improve Care Are Under Way but Will Require Continued Commitment

GAO (2000) Nursing Homes: Sustained Efforts Are Essential to Realize Potential of the Quality Initiatives;

HCFA (1998) Study of Private Accreditation (Deeming) of Nursing Homes, Regulatory Incentives and Non-Regulatory Incentives, and Effectiveness of the Survey and Certification System

HCFA (2000) Appropriateness of Minimum Nurse Staffing Ratios in Nursing Homes.

Written by Bernadette Wright, AARP Public Policy Institute
February 2001
©2001 AARP
May be copied only for noncommercial purposes and with attribution; permission required for all other purposes.
Public Policy Institute, Public Affairs, AARP, 601 E Street, NW, Washington, DC 20049

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