News from The National Citizens' Coalition for Nursing Home Reform (NCCNHR)

November 9, 2007

Washington Shifts Into High Gear; Congressional Hearings Next Thursday, Nov. 15, 2007

The nursing home reform doldrums are over!A year that started off commemorating of the 20th anniversary of the last major nursing home legislation, OBRA '87, shifted into high gear after the Sept. 23 New York Times article exposing declines in staffing and quality in facilities purchased by private equity investors. Next Thursday, Nov.15, two congressional committees will hold hearings:

The Health Subcommittee of the House Ways and Means Committee, which hasjurisdiction over Medicare, will examine the effect of nursing home ownership trends on quality and accountability. Rep. Pete Stark (D-CA), who chairs the subcommittee, was one of the original sponsors of the Nursing Home Reform Act and received a Special Policy Leadership Award from NCCNHR this year. In announcing the hearing, Stark said, ""It has been far too long since Congress has focused on nursing home quality issues. I am concerned about quality issues and lack of accountability, particularly as more and more beneficiaries are now living in private equity-owned homes."" The hearing will begin at 10 a.m. in Room 1100, Longworth House Office Building. NCCNHR met with subcommittee staff to provide recommendations for legislation to address the lack of transparency in nursing home ownership, operations, and expenditures. 

The Senate Special Committee on Aging will hold its second nursing home hearingof the year on Nov. 15. (NCCNHR Executive Director Alice Hedt testified at a May hearing about the 20th anniversary of OBRA.) Witnesses will include Senator Chuck Grassley (IA), Ranking Republican on the Finance Committee; Sarah Slocum, Michigan State Long-Term Care Ombudsman; Kerry Weems, Acting Administrator of the Centers for Medicare and Medicaid Services; David Zimmerman, long-time University of Wisconsin researcher on nursing home quality measurement; and Arvid Muller, research director at the Service Employees International Union. Committee Chair Herb Kohl (D-WI) spoke at the NCCNHR Annual Meeting's closing plenary on Capitol Hill Oct. 24 and said that he would be introducing legislation. reforms!

Other Members of Congress Address the Private-Equity Issue

Rep. John Dingell (D-MI), chairman of the Energy and Commerce Committee, which has authority over Medicaid, and Rep. Barney Frank (D-MA), chairman of the Financial Services Committee, said Oct. 23 that they also plan to investigate private-equity ownership of nursing homes, but hearings have not been scheduled. Rep. Dingell also was a recipient this year of a NCCNHR Special Policy Leadership Award for being an original sponsor of OBRA '87.
Senators Max Baucus (D-MT) and Chuck Grassley (R-IA), chair and ranking member respectively of the Finance Committee, which has jurisdiction over Medicare and Medicaid, sent letters to five private investment firms requesting ownership and management information about their nursing home chains. (See Grassley, Baucus ask about oversight and operation of nursing homes taken over by large private investment firms.) Grassley and Senator Hillary Clinton (D-NY) have also asked the Government Accountability Office to investigate private-equity investments in nursing homes.

NCCNHR Provides Congress Recommendations on Transparency and Accountability

Today seven other national organizations are joining with NCCNHR in a letter to Congress asking for legislation to increase transparency and accountability in corporate ownership of nursing homes. The provisions would:

Require corporations to disclose owners and all affiliated entities with direct or indirect financial interest in a nursing facility, and require all these entities to be parties to the Medicare and Medicaid provider agreement and to be disclosed on Nursing Home Compare.

* Require owners to post ""surety bonds"" to cover fines; civil monetary penalties; temporary managers or receivers; attorney fees, litigation costs, and damage awards to plaintiffs in civil damage suits; and operational costs when residents are abandoned or workers are not paid.

* Require CMS to certify provider agreements annually.

* Require CMS to post enforcement actions and maintain actual survey reports (CMS Form 2567) on Nursing Home Compare.

* Require CMS to collect nurse staffing data electronically from nursing home payroll records on a quarterly basis; audit the data; and report facilities' staffing ratios and turnover and retention rates on Nursing Home Compare.

* Require that costs on Medicare cost reports be reported for five cost centers: direct care nursing services; other direct care services; indirect care; capital costs; and administrative costs; and require them to be reported on Nursing Home Compare.

* Require CMS to audit cost reports and establish penalties for filing false reports.

What Next?

Independent bills are relatively rare these days -- most legislation ends up on a larger ""vehicle"" that is likely to move through both housesbefore the end of the congressional term. Congressional committees are currently working on a Medicare bill that would be the logical vehicle for any nursing home measures that pass this year. Only a few working days remain in this Congress, but given the intensity of the interest in the committees with Medicare jurisdiction (Finance, Ways and Means) and nursing home oversight (Aging), we are encouraged that some measures will pass this year. Next year, interest will resume with the publication of the GAO reports on private equity companies and promised additional hearings.