Biden Administration Takes Action to Improve Competition, Transparency and Quality for Hospitals and Nursing Homes


The Facilities for Medicare & Medicaid Companies (CMS) lately printed detailed databases summarizing modifications of possession of Medicare-enrolled hospitals and expert nursing amenities (SNFs). The databases presently embrace data from 2016 to 2022, however the information can be up to date and launched quarterly. CMS additionally launched the expert nursing facility potential cost system (SNF PPS) proposed rule (the Proposed Rule), together with proposed updates to cost primarily based on high quality and value-based care measures.


In line with the Biden-Harris administration’s said targets of enhancing transparency, security, accountability and high quality in healthcare, and particularly in nursing homes, on April 20, 2022, the White Home issued the first-ever launch of public information by the Facilities for Medicare & Medicaid Companies (CMS) on modifications of possession involving hospitals and nursing properties enrolled in Medicare. Relatedly, on April 11, 2022, CMS additionally issued the fiscal 12 months (FY 2023) proposed rule for Medicare cost insurance policies and charges for nursing properties beneath the Expert Nursing Facility Potential Fee System (SNF PPS) (the Proposed Rule). The Proposed Rule consists of numerous potential metrics for the SNF Quality Reporting Program and the SNF Worth-Based mostly Program for FY 2023. We talk about these developments in flip on this alert.

  1. Transparency on Hospital and Nursing Dwelling Possession

Suppliers that take part in Medicare are required to enroll and present detailed possession data of all direct and oblique house owners, no matter whether or not such house owners are organizations or people. Suppliers are additionally required to replace their possession data inside 30 days of a change of possession. CMS usually makes use of the Supplier Enrollment, Chain and Possession System (PECOS), an digital on-line system, to preserve and replace this enrollment and possession data. Whereas CMS has lengthy maintained this data internally, on April 20, 2022, CMS launched for the primary time information on mergers, acquisitions, consolidations and modifications of possession from 2016 to 2022 for hospitals and nursing properties enrolled in Medicare.

The database features a Hospital Change of Ownership dataset and Skilled Nursing Facility Change of Ownership dataset, in addition to an preliminary Summary Analysis from the HHS Workplace of the Assistant Secretary for Planning and Analysis. The Hospital Change of Possession dataset offers data on particular person and organizational possession curiosity and managerial management related to the customer and vendor organizations, in addition to the function of the proprietor, affiliation date, deal with of the organizational proprietor and different possession particulars. The SNF Change of Possession dataset consists of data on the customer and vendor group’s authorized enterprise title, supplier sort, change of possession sort and the efficient date of the change. CMS expects to launch up to date change of possession information for each databases on a quarterly foundation.

The newly launched data will allow the general public to determine when (1) a Medicare-enrolled hospital or SNF has been bought or leased by one other group, (2) a Medicare-enrolled hospital or SNF purchases or has been bought by one other enrolled supplier, or (3) two or extra enrolled Medicare hospitals or SNFs consolidate to type a brand new enterprise entity. As well as to offering change of possession data, the information consists of detailed details about the direct and oblique house owners of Medicare-enrolled hospitals and SNFs.

The database was first introduced in late February 2022 as a part of the State of the Union Action Plan for Protecting Seniors by Improving Safety and Quality of Care in the Nation’s Nursing Homes. The information is meant to allow researchers, enforcement officers and the general public to analyze developments and look at the connection between possession of healthcare amenities and variables resembling prices and outcomes on sufferers. CMS famous that making change of possession data public will allow researchers to determine developments and points associated to modifications of possession and consolidation, significantly in relation to healthcare costs, accessibility and high quality. The discharge of the database is in furtherance of the Biden-Harris administration’s coverage intentions said within the 2021 Executive Order on Promoting Competition, whereby the administration expressed issues that hospital consolidation has resulted in elevated healthcare costs and insufficient choices in some areas of the nation. Within the announcement accompanying its launch, CMS indicated that publishing the database is “one of many” initiatives to improve transparency and enhance competitors in healthcare, and we anticipate to see additional developments on this matter all through the approaching 12 months.

CMS famous that making possession data publicly out there will allow researchers and policymakers to perceive in additional element how healthcare amenities are owned and the place possession of healthcare amenities could also be extra concentrated. CMS additionally famous that the information could also be utilized by the Justice Division and the Federal Commerce Fee in reference to evaluate of mergers and acquisitions for compliance with federal antitrust regulation.

As well as to selling competitors, CMS highlighted that making change of possession information public could also be helpful in monitoring healthcare high quality. CMS pointed to tutorial analysis on acquisition of SNFs by personal fairness and different personal funding corporations to spotlight potential high quality of care issues with these acquisitions. CMS is all in favour of understanding the affect of various possession sorts on the standard of care furnished by healthcare entities.

  1. Expert Nursing Facility Potential Fee System (SNF PPS) Proposed Rule

Additional constructing upon the White Home’s said dedication to enhancing security and high quality in nursing properties, CMS lately printed its annual SNF PPS Proposed Rule. As well as to proposed charge changes, the Proposed Rule discusses numerous parts showcasing CMS’ continued efforts to prioritize the worth, relatively than quantity, of sure companies sufferers obtain in nursing properties. A abstract of those parts is printed beneath.

  1. Up to date Fee Charges and Recalibrated Parity Adjustment

CMS estimates that the SNF PPS will end in a web lower of roughly $320 million in Medicare Half A funds to SNFs in FY 2023 in contrast to FY 2022. This estimate displays a $1.4 billion (3.9%) improve within the FY 2022 SNF PPS unadjusted federal per diem charges and a $1.7 billion (4.6%) proposed discount in combination SNF spending. The discount in SNF spending, in flip, displays a proposed recalibration of the parity adjustment initially used beneath the Affected person Pushed Fee Mannequin (PDPM). The PDPM, which CMS anticipated to be budget-neutral and neither improve nor lower combination SNF spending, went into impact on October 1, 2019. Nevertheless, the PDPM as a substitute precipitated an unintended improve in SNF funds of roughly 5%, or $1.7 billion, in FY 2020. Consequently, and after contemplating stakeholder suggestions acquired within the FY 2022 SNF PPS rulemaking cycle, CMS is proposing a parity adjustment to the PDPM that would cut back SNF spending by 4.6% in FY 2023.

  1. Minimal Staffing Necessities

CMS is soliciting enter within the Proposed Rule to information its institution of minimal staffing necessities (e.g., nurses, aides and different professionals) for long-term care amenities to guarantee resident wants are met and to enhance resident operate and high quality of life. CMS intends to challenge extra proposed guidelines on minimal staffing degree necessities for nursing properties inside the subsequent 12 months.

  1. SNF Quality Reporting Program Proposed Measures

Pursuant to the SNF Quality Reporting Program, CMS publishes high quality measures that SNFs should report on an annual foundation. Starting with the FY 2025 program 12 months, CMS is proposing the adoption of the Influenza Vaccination Protection amongst Healthcare Personnel (HCP) measure, which might report the share of HCP who obtain an annual influenza vaccine from the time the vaccine first turns into out there via March 31 of the next 12 months. Monitoring and reporting influenza vaccination charges amongst HCP is crucial as a result of HCP are in danger for (1) buying influenza from residents and (2) exposing influenza to residents, given the truth that influenza vaccination protection amongst HCP is often decrease in long-term care settings relative to different care settings. CMS proposes to scale back by 2% the annual charge replace of SNFs that fail to meet the reporting necessities.

  1. SNF Worth-Based mostly Buying Program Proposed Measures

CMS is proposing 4 measures as a part of the SNF Worth-Based mostly Buying Program to incentivize SNFs paid beneath the SNF PPS primarily based on the standard of care they supply to Medicare beneficiaries.
First, the Nursing Dwelling Workers Turnover measure would determine employees turnover ranges in nursing properties by reporting the share of complete nurse employees that left the SNF during the last 12-month interval. This measure is supported by information from CMS exhibiting that as the common employees turnover decreases, a facility’s general score on CMS’ Nursing Dwelling 5 Star Quality Score System will increase. This purportedly means that decrease turnover leads to increased general high quality. By way of a Request for Data, CMS is requesting stakeholder enter on this measure for future inclusion within the Worth-Based mostly Buying Program.

Second, the Expert Nursing Facility Healthcare Related Infections Requiring Hospitalization measure would assess SNF efficiency on an infection prevention and administration, which CMS proposes implementing in the course of the FY 2026 program 12 months.
Third, the Whole Nursing Hours per Resident Day measure would use auditable digital information to calculate complete nursing hours per resident, which CMS proposes to implement as a part of the FY 2026 program 12 months.

Lastly, the Adoption of the Discharge to Group – Publish Acute Care Measure for SNFs would assess the speed of profitable discharges to group from a SNF setting, which CMS is proposing to implement in the course of the FY 2027 program 12 months.

  1. Key Takeaways

The Biden-Harris administration is taking quite a few steps to obtain its targets of enhancing security, accountability, oversight and transparency within the hospital and senior-services trade for sufferers and employees. CMS highlighted that it will likely be publishing minimal staffing ranges for SNFs and will proceed explicitly tying cost for SNF companies to staff-turnover ranges.

Whereas CMS has beforehand launched supplier enrollment recordsdata to the general public, the discharge of change of possession data will allow researchers and the general public to extra intently scrutinize acquisitions and gross sales of Medicare hospitals and SNFs. The discharge additionally consists of extra detailed possession data than has beforehand been launched. CMS has explicitly famous that it’s hoping for nearer scrutiny of this data to inform policymaking, together with analysis on the affect of possession on the standard and price of healthcare furnished by Medicare suppliers. Medicare-enrolled hospitals and SNFs ought to be conscious that this data is now publicly out there and might immediate public scrutiny.

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