A proposed federal rule that would force nursing-home owners to fully disclose their ownership structures is being supported by Massachusetts Attorney General Andrea Joy Campbell, 17 other attorneys general as well as a number of advocacy groups.
Some in the industry are pushing back on the proposal by the U.S. Centers for Medicare and Medicaid Services. The rule is meant to increase transparency so regulators can better do their job amid widespread neglect and substandard care of nursing-home residents.
Some reform groups say the rule doesn’t go far enough for detailed transparency.
The Centers, known by the initials CMS, had asked for public comment on the proposed rule. Campbell is co-leading a coalition of the attorneys general that last week submitted its comments to CMS.
In a statement, Campbell’s office described the proposed policies as “common sense” that will help attorneys general and their Medicaid fraud control units “hold bad actors accountable for providing substandard care in nursing facilities.”
The CMS proposal, at the urging of the Biden Administration, would require nursing homes to disclose ownership information and who the decision-makers are, especially in the cases of those owned by private-equity and real-estate-investment trusts.
Studies have made a connection between those ownership models and bad outcomes, including an increase in deaths.
One study of private-equity ownership also found “worsening mobility of residents, declines in nurse availability per resident, and elevated use of antipsychotic medications in nursing facilities,” Campbell’s office said.
Residents and staff members in Berkshire County nursing homes are often reporting neglect and poor care that can lead to the deterioration of health or the deaths of residents.
Chronic understaffing that is the root of such problems long predates the pandemic, an Eagle investigation found, but COVID brought the problems to the surface.
For every two people who died of or with the virus in a nursing home, one died “prematurely of other causes,” according to a study cited by Campbell’s office.
Staff members often don’t make a living wage, and the crisis has prompted the industry, arguing that Medicaid isn’t covering operating costs, to ask for more taxpayer money this year for pay increases. The state has paid nursing homes more than $300 million in the last two years.
Reform advocates say the industry shouldn’t get a dime more until nursing homes fully open their books, and do, in part, what CMS is seeking with its proposed rule.
The murky ownership and management structure also “hampers and delays law enforcement efforts,” Campbell’s office said.
Some executives in the industry say the CMS rule will pile on layers of bureaucracy and not accomplish what it intends, according to an article in Skilled Nursing News, an industry publication.
They also say that the rule is targeting ownership models that make up only small percentage of U.S. nursing homes. A study by researchers at Weill Cornell Medical College published in November of 2021 found that only about 5 percent of nursing homes have private-equity ownership, and Mark Parkinson, president and CEO at the American Health Care Association/National Center for Assisted Living, said about 12 percent of facilities are owned by real-estate-investment trusts.
Parkinson, in a statement, called the rule’s focus on ownership a “red herring,” and a “distraction from the real issues that impact the majority of providers, like Medicaid underfunding and workforce shortages.”
The American Association for Justice, an advocacy nonprofit and lobby for plaintiff’s lawyers, applauds CMS for the proposal but wants the agency to take the rule a step further. The association wants CMS to force nursing-home owners to identify their parent companies and clarify the entire ownership structures, among its other suggestions.
Increasingly, nursing homes “are owned by entities that create complex networks of subsidiaries to manage their vast holdings,” the association said in a news release, adding that the public needs to know exactly where all the billions in taxpayer money is going.