Legislative Proposals to Improve Nursing Home Quality

Vested Partners A Multi-Family Office Blog

Senior woman sitting in wheelchair alone
White House officials recently outlined more than 20 separate actions, many of them sought by advocates and opposed by the industry.

Nursing home residents represent a disproportionate share of deaths in the COVID-19 pandemic, and the Biden administration has been working to develop home- and community-based care as an alternative.

Fox 29’s recent article “Biden to launch ambitious overhaul of nursing home quality” reports that the cornerstone of Biden’s nursing home plan is a new requirement for minimum staffing levels. The president is ordering the Centers for Medicare and Medicaid Services to conduct a study on staffing and publish proposed regulations within a year.

Experts say staffing levels are the single most critical factor for nursing home quality, and many facilities lack sufficient numbers of nurses, nursing assistants and other staff to give direct care to patients. The coronavirus pandemic has resulted in many workers leaving the industry, even as nursing homes raised wages. Thus, a new federal staffing requirement may take time to put into place.

Congress has been debating legislation to require minimum staffing standards for facilities that accept payment from Medicare and Medicaid, as virtually all do. The original plan was set to include staffing requirements in the president’s domestic agenda bill. However, with that legislation stalled, the administration seems to be shifting to using its regulatory powers to bring about changes.

The plan also has a move toward private rooms for nursing home residents, directing federal regulators to examine how to phase out living arrangements that house three or more residents in the same room.

“Despite the tens of billions of federal taxpayer dollars flowing to nursing homes each year, too many continue to provide poor, substandard care that leads to avoidable resident harm,” said a White House policy document that outlined Biden’s plan.

More oversight is another priority for President Biden, whose plan calls for increasing the nursing home inspection budget by $500 million—an increase of almost 25%. Nursing home inspections are usually done by the states, following guidelines from Medicare. The president is planning to redo a special inspection program that focuses on low-performing facilities, to raise fines on nursing homes that fail to improve and, if necessary, cut off Medicare and Medicaid payments.

More than half of the nation’s nursing homes are owned by for-profit companies, and the Biden administration wants to look at the growing trend of private equity firms buying up ownership of facilities. The White House said the private equity stake in the industry grew from $5 billion in 2000 to more than $100 billion by 2018.

“Too often, the private equity model has put profits before people, a particularly dangerous model when it comes to the health and safety of vulnerable seniors and people with disabilities,” the White House policy document said.

Officials said federal agencies will be directed to examine the role of private equity investors in the nursing home industry “and inform the public when corporate entities are not serving their residents’ best interests.”

The private equity industry believes that investor ownership can mean better management of nursing homes, including the use of standardized care procedures and evaluation of nursing home administrators.

Reference: Fox 29 (Feb. 28, 2022) “Biden to launch ambitious overhaul of nursing home quality”


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