Senate Democrats Issue RFI Seeking Radical Changes to SNFs

Calling the Nursing Home Reform Act of 1987 long overdue for an overhaul, Sen. Ron Wyden (D-Ore.), ranking member of the Senate Finance Committee, on Oct. 16 issued a broad and sweeping Request for Information (RFI) for “improving long-term care for all Americans.”

In the crosshairs of this RFI are nursing homes, with a big chunk – if you consider 7,600 words a big chunk -- of the actual document focused on possibly making radical changes to how the sector operates.

The document is the latest pre-midterms salvo in what could be a Democratic takeover of Congress, which would make these policy blueprints all the more important to gauge for nursing home owners/operators, staff, and residents/families.

“Long-term care and the decisions that surround it are among the most personal and sensitive any American family must face,” Wyden said in a press statement. “Today, those decisions are too often driven by financial considerations rather than what is best for a loved one and their family. Senate Democrats are determined to deliver an equitable and affordable home care guarantee for all Americans in need, improve the quality of long-term care across the board, and make sure there are workers in good jobs to meet that need.”

The RFI seeks feedback on a range of policy proposals that “create universal, simple and flexible access to long-term care for Americans in every circumstance, while investing in a strong workforce and creating safeguards that protect people and taxpayer dollars alike.”

Three general areas for feedback include:

-          Making home care affordable and accessible especially for Americans with disabilities and seniors.

-          Improving the quality of care in nursing homes

-          Strengthening the long-term care workforce

The text of the RFI is at this link. 

Reading the RFI

The section on nursing homes is Section II: Improve the Quality of Care in Nursing Homes.

The words that follow are directly from the RFI, which can be read from the link above, and reflect the views of Senate Democrats who issued the document.

“In this section, Senate Democrats seek feedback on policies to make nursing homes a safe, high-quality setting.

These include:

-          Ensuring taxpayer dollars are spent on direct care rather than siphoned off through profit-hiding shell games.

-          Improving the transparency of nursing home ownership, operations, quality, and cost reporting.

-          Aligning incentives to strengthen nursing home staffing standards so residents are safe and workers are supported.

-          Updating the survey, certification, and quality measurement of nursing homes and available technical assistance and support to ensure facilities consistently meet high-quality standards…

…Despite the long-term trend toward de-institutionalization and advances that allow more skilled care to be delivered at home, nursing homes are still a crucial part of the nation’s LTC infrastructure. Seniors and people with disabilities should be able to receive care in the setting of their choice, and for some, a nursing home is the preferable, or only, option.

Congress passed the Nursing Home Reform Act of 1987 to raise the standard of the quality of care provided in America’s nursing homes. Specifically, the law established the Nursing Home Resident Bill of Rights and core nursing home quality and safety standards. These standards require a physician's supervision of each resident's care, 24-hour nursing services provided by a range of clinical staff, a personalized plan of care for each nursing home resident, and pharmaceutical, dietician, dental, and other supportive services to implement that plan of care.

The landmark law also established safeguards for nursing home resident rights, state licensure and oversight requirements, and state training standards for Certified Nursing Assistants in nursing homes. As the 40th anniversary of these federal standards nears, there has been no comprehensive statutory update since its passage. These standards must be updated to reflect the growing and changing needs of nursing home residents and the increasing role of private equity and corporate ownership of nursing homes…”

Breaking it Down

The RFI then outlines the specific areas of concern for Senate Democrats.

Among these are questions on SNF ownership, and the role of private equity (PE) and REITs in the sector and how this relates to the expenditure of Medicare and Medicaid dollars on direct care of residents.

“PE firms and other corporate entities invest in the nursing home sector, but government watchdogs, regulators, and researchers lack the data to obtain an accurate understanding of their presence. The Government Accountability Office estimated that 5% of the nation’s nursing homes enrolled in Medicare had PE ownership in 2022, and the Medicare Payment Advisory Commission found as much as 11% of the sector may be PE-owned,” the RFI said.

“The Biden administration required states to report to CMS the percentage of Medicaid payments for services in nursing homes that is spent on compensation for direct care workers and support staff in nursing homes. The intent of this proposal was to hold nursing homes accountable for investing taxpayer dollars in the LTC workforce,” the RFI said.

“Ranking Member Wyden successfully defended this important data collection when Congressional Republicans attempted to repeal it in H.R. 1. To build on these advances, Senate Democrats request feedback on extending this requirement to Medicare and requiring nursing homes to spend a specific percentage of Medicare and Medicaid reimbursement on the direct care of nursing home residents."

Several states, the RFI said, including Massachusetts, New York, and New Jersey require nursing homes to spend a certain share of their revenue, including revenue from Medicare and Medicaid, on direct patient care.

“Senate Democrats request information on the effectiveness of state-level proposals and how to apply them at the federal level. Senate Democrats are also interested in feedback on the specific percentage thresholds that are linked to improved outcomes for nursing home residents,” the RFI said.

Senate Democrats request input on the following policies:

-          Reinstating requirements for nursing homes to submit detailed ownership and management information to CMS that the Trump administration indefinitely postponed.

-          Limiting PE involvement in nursing home care by restricting the ability of PE and corporate owners to inappropriately influence nursing home operations that impact resident care, based on Senators Warren and Wyden’s bill, the Stop Corporate Takeovers of Physicians Act of 2026 (S. 5419).

-          Reinstating the requirements of the Corporate Transparency Act, which was enacted in 2021 and includes provisions that create a central repository of beneficial ownership information for business entities, including those operating nursing homes and related entities.

-          Requiring CMS to evaluate the track record of nursing home operators, including the financial stability of and quality of care provided by health care entities they previously invested in, during the Change in Ownership (CHOW) or Change of Operator (CHOP) processes. This could require CMS to review every prior nursing home or other health care facility an individual or entity operated, use existing quality metrics to evaluate CHOW/CHOP approval, or require beneficial ownership disclosure as a condition of CHOW/CHOP approval.”

Senate Democrats also request feedback on policies to increase regulation of related party transactions in nursing homes. These include:

-          Establishing market-rate benchmarks for common related party services like management fees, pharmacy services administration, lease payments, and home office costs, against which reported related party costs can be evaluated, and allowing CMS to recover charges for costly related party transactions without clear justification.

-          Modernizing the definition of “related party.” Under current regulations, CMS defines related party costs in a manner that lacks specificity and can be difficult to oversee. We request feedback on updating these definitions to provide explicit examples of common relationships between nursing homes and other entities that rise to the levels of possessing “significant ownership or equity” and having the power to “significantly…influence or direct” a nursing home’s actions or policies.

Staffing Mandates

The next focus of the nursing home section of the RFI centered on “Strengthening Nursing Home Staffing Standards,” which dovetailed into the hot-button topic of staffing mandates.

“Advocates for nursing home residents, researchers, and labor unions emphasized the importance of increasing nursing home staffing levels beyond the current standard in order to improve the quality of nursing home care and the quality of nursing home jobs. At the same time, nursing home trade associations and individual nursing homes emphasized that staffing regulations would be very difficult to meet without significant workforce investments and improvements, and they predicted that nursing homes, particularly those in rural areas, would close if higher federal nursing home standards went into effect,” the RFI said.

Senate Democrats request feedback on the following proposals included in the Nurses Belong in Nursing Homes Act (S. 3886), which Wyden and other Senate Democrats introduced earlier this year. These include:

-          Requiring an RN to be in a nursing home 24/7.

-          Setting an initial federal minimum staffing standard to make sure that each resident receives at least three and a half hours of nursing care per day.

-          Ensuring regular, evidence-based updates to staffing standards to reflect resident needs.

-          Providing permanent funding for nursing home inspections, surveys, and enforcement to ensure compliance with staffing requirements.

-          Bolstering the nursing home workforce by reinvesting civil monetary penalties imposed on nursing homes into supporting recruitment and retention of nursing home workers.

-          Holding nursing homes accountable for investing taxpayer dollars into the frontline nursing home workforce rather than increasing their own profits.

“In evaluating these proposals, Senate Democrats request specific feedback on how the federal government can best continually update federal staffing standards, so they reflect emerging technology and new standards of care. Senate Democrats specifically request feedback on the following questions:

-          What frequency and with what standard of evidence should CMS update staffing standards for nursing homes? Should this evidence base account for specific populations, such as individuals with Alzheimer’s disease and other forms of dementia?

-          How should patient acuity factor into CMS’ update of staffing standards?

-          What quality measures and outcomes should be considered when updating and evaluating the effectiveness of nursing home staffing standards?

-          What is the evidence that technologies like remote monitoring and telehealth can improve the quality of care delivered in nursing homes? How can these technologies be deployed along with sufficient staffing to keep residents safe?”

Senate Democrats said they are also interested in soliciting feedback on whether there can be policy proposals to ensure adequate staffing absent a federal staffing standard.

“Respondents are encouraged to submit evidence demonstrating the effectiveness of alternative proposals in achieving the results that a staffing standard delivers, such as lower patient mortality, lower worker burnout, or other patient and worker well-being metrics,” the RFI said.

Finally, recognizing the important role workforce investments play in effective, durable nursing home staffing standards, Senate Democrats request information on proposals to pair staffing standards with workforce investments.

Finale

The RFI continues on and covers questions the RFI requested feedback on, including the Star rating system, the survey system, and workforce funding, among a host of issues.

Contact Patrick Connole at pconnole@parkplacelive.com for further information on this article.