I 

109TH CONGRESS 

1ST SESSION H. R. 3437 

To amend titles XVIII and XIX of the Social Security Act with respect 

to reform of Federal survey and certification process of nursing facilities 

under the Medicare and Medicaid Programs. 

IN THE HOUSE OF REPRESENTATIVES 

JULY 26, 2005 

Mr. CAMP introduced the following bill; which was referred to the Committee 

on Ways and Means, and in addition to the Committee on Energy and 

Commerce, for a period to be subsequently determined by the Speaker, 

in each case for consideration of such provisions as fall within the jurisdiction of the committee concerned 

A BILL 

To amend titles XVIII and XIX of the Social Security Act 

with respect to reform of Federal survey and certification 

process of nursing facilities under the Medicare and Medicaid Programs. 

1 Be it enacted by the Senate and House of Representa2 tives of the United States of America in Congress assembled, 

3 SECTION 1. SHORT TITLE. 

4 This Act may be cited as the ‘‘Medicare and Medicaid 

5 Nursing Facility Quality Improvement Act of 2005’’. 
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1 SEC. 2. QUALITY IMPROVEMENT FOR NURSING FACILITIES 

2 UNDER THE MEDICARE AND MEDICAID PRO3 GRAMS. 

4 (a) INCENTIVES FOR IMMEDIATE IMPROVEMENT AND

5 PROTECTION OF NEEDED TRAINING PROGRAMS.— 

6 (1) MEDICARE PROGRAM.—Section 1819(f)(2) 

7 of the Social Security Act (42 U.S.C. 1395i–3(f)(2)) 

8 is amended— 

9 (A) in subparagraph (B)— 

10 (i) by adding ‘‘and’’ at the end of 

11 clause (i); 

12 (ii) by striking ‘‘; and’’ at the end of 

13 clause (ii) and inserting a period; and 

14 (iii) by striking clause (iii); and 

15 (B) by striking subparagraphs (C) and 

16 (D). 

17 (2) MEDICAID PROGRAM.—Section 1919(f)(2) 

18 of such Act (42 U.S.C.1396r(f)(2)) is amended— 

19 (A) in subparagraph (B)— 

20 (i) by adding ‘‘and’’ at the end of 

21 clause (i); 

22 (ii) by striking ‘‘; and’’ at the end of 

23 clause (ii) and inserting a period; and 

24 (iii) by striking clause (iii); and 

25 (B) by striking subparagraphs (C) and 

26 (D). 
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1 (b) SPECIFIED REMEDIES.— 

2 (1) MEDICARE PROGRAM.—Section 

3 1819(h)(2)(B) of such Act (42 U.S.C. 1395i– 

4 3(h)(2)(B)) is amended— 

5 (A) by redesignating clause (iii) as clause 

6 (iv); and 

7 (B) by inserting after clause (ii) the fol8 lowing new clause: 

9 ‘‘(iii) DISAPPROVAL OF NURSE AIDE

10 TRAINING AND COMPETENCY EVALUATION

11 PROGRAMS.—In consultation with the 

12 State, the Secretary may disapprove nurse 

13 aide training and competency evaluation 

14 programs offered by the facility.’’. 

15 (2) MEDICAID PROGRAM.—Section 

16 1919(h)(2)(A) of such Act (42 U.S.C. 

17 1396r(h)(2)(A)) is amended— 

18 (A) by redesignating clauses (iii) and (iv) 

19 as clauses (iv) and (v), respectively; and 

20 (B) by inserting after clause (ii) the fol21 lowing new clause: 

22 ‘‘(iii) In consultation with the State, 

23 the Secretary may disapprove nurse aide 

24 training and competency evaluation pro25 grams offered by the facility.’’. 
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1 (c) PROMOTING INNOVATION AND QUALITY IM2 PROVEMENT THROUGH STATE WAIVERS.— 

3 (1) MEDICARE PROGRAM.—Section 1819(g) of 

4 such Act (42 U.S.C. 1395i–3(g)) is amended by add5 ing at the end the following new paragraph: 

6 ‘‘(6) WAIVER DEMONSTRATION AUTHORITY TO

7 PROMOTE INNOVATION AND QUALITY IMPROVE8 MENT.— 

9 ‘‘(A) IN GENERAL.—At the request of a 

10 State, but not to exceed a total of 3 States, the 

11 Secretary may waive provisions of this sub12 section relating to survey and certification pro13 cedures in order to test and implement innova14 tive alternatives to the survey process otherwise 

15 applicable. The Secretary shall provide special 

16 consideration to the application of alternative 

17 procedures that increase the use of outcome 

18 measures, the incorporation of quality of life 

19 measures, and improve consistency and accu20 racy in deficiency determinations and survey re21 sults. The Secretary shall approve a waiver re22 quest if applicant demonstrates significant po23 tential for improving the quality of care, quality 

24 of life, and safety of residents. 
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1 ‘‘(B) CONSIDERATION OF VIEWS OF

2 STAKEHOLDERS.—The Secretary shall only con3 sider waiver applications under this paragraph 

4 from a State under this paragraph if the State 

5 has convened and consulted with appropriate 

6 stakeholders in the State, including representa7 tives of nursing facilities, consumers groups, 

8 the State long term care ombudsman, labor or9 ganizations (and where such organizations are 

10 not present in the industry, other employee rep11 resentatives), and licensed health care pro12 viders, to assist in developing their alternative 

13 system. In determining whether to grant such 

14 waivers the Secretary shall take into consider15 ation the views of the stakeholders convened by 

16 the State.’’. 

17 (2) MEDICAID PROGRAM.—Section 1919(g) of 

18 such Act (42 U.S.C. 1396r(g)) is amended by add19 ing at the end the following new paragraph: 

20 ‘‘(6) WAIVER DEMONSTRATION AUTHORITY TO

21 PROMOTE INNOVATION AND QUALITY IMPROVE22 MENT.— 

23 ‘‘(A) IN GENERAL.—At the request of a 

24 State, but not to exceed a total of 3 States, the 

25 Secretary may waive provisions of this sub-
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1 section relating to survey and certification pro2 cedures in order to test and implement innova3 tive alternatives to the survey process otherwise 

4 applicable. The Secretary shall provide special 

5 consideration to the application of alternative 

6 procedures that increase the use of outcome 

7 measures, the incorporation of quality of life 

8 measures, and improve consistency and accu9 racy in deficiency determinations and survey re10 sults. The Secretary shall approve a waiver re11 quest if it demonstrates significant potential for 

12 improving the quality of care, quality of life, 

13 and safety of residents. 

14 ‘‘(B) CONSIDERATION OF VIEWS OF

15 STAKEHOLDERS.—The Secretary shall only con16 sider waiver applications under this paragraph 

17 from a State under this paragraph if the State 

18 has convened and consulted with appropriate 

19 stakeholders in the State, including representa20 tives of nursing facilities, consumers groups, 

21 the State long term care ombudsman, labor or22 ganizations (and where such organizations are 

23 not present in the industry, other employee rep24 resentatives), and licensed health care pro25 viders, to assist in developing their alternative 
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1 system. In determining whether to grant such 

2 waivers the Secretary shall take into consider3 ation the views of the stakeholders convened by 

4 the State.’’. 

5 (d) REMOVAL OF INFLEXIBILITY IN PROVIDER TER6 MINATION.— 

7 (1) MEDICARE PROGRAM.—Section 1819(h)(2) 

8 of such Act (42 U.S.C. 1395i–3(h)(2)) is amended— 

9 (A) in subparagraph (D), by striking ‘‘If’’ 

10 and inserting ‘‘Subject to subparagraph (F), 

11 if’’; 

12 (B) in subparagraph (E), by striking ‘‘In’’ 

13 and inserting ‘‘Subject to subparagraph (F), 

14 in’’; and 

15 (C) by adding at the end the following new 

16 subparagraph: 

17 ‘‘(F) CONTINUATION OF PAYMENTS PEND18 ING REMEDIATION WHEN FLEXIBILITY NEEDED

19 TO PROTECT RESIDENTS.—The Secretary may 

20 continue payments, over a period not longer 

21 than 12 months after the effective date of the 

22 findings, under this title with respect to a nurs23 ing facility not in compliance with a require24 ment of subsection (b), (c), or (d), if— 
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1 ‘‘(i) the State survey agency finds 

2 that ceasing payments is not in the best 

3 interests of residents and that continuation 

4 of payments would not jeopardize resi5 dents’ health and safety; 

6 ‘‘(ii) the State survey agency finds 

7 that it is more appropriate to take alter8 native action to assure compliance of the 

9 facility with the requirements than to ter10 minate the certification of the facility; and 

11 ‘‘(iii) the State has submitted a plan 

12 and timetable for corrective action to the 

13 Secretary for approval and the Secretary 

14 approves the plan of corrective action.’’. 

15 (2) MEDICAID PROGRAM.—Section 1919(h)(2) 

16 of such Act (42 U.S.C. 1396r(h)(2)) is amended— 

17 (A) in subparagraph (C), by striking ‘‘If’’ 

18 and inserting ‘‘Subject to subparagraph (G), 

19 if’’; 

20 (B) in subparagraph (D), by striking ‘‘In’’ 

21 and inserting ‘‘Subject to subparagraph (G), 

22 in’’; and 

23 (C) by adding at the end the following new 

24 subparagraph: 
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1 ‘‘(G) CONTINUATION OF PAYMENTS PEND2 ING REMEDIATION WHEN FLEXIBILITY NEEDED

3 TO PROTECT RESIDENTS.—The Secretary may 

4 continue payments, over a period not longer 

5 than 12 months after the effective date of the 

6 findings, under this title with respect to a nurs7 ing facility not in compliance with a require8 ment of subsection (b), (c), or (d), if— 

9 ‘‘(i) the State survey agency finds 

10 that ceasing payments is not in the best 

11 interests of residents and that continuation 

12 of payments would not jeopardize resi13 dents’ health and safety; 

14 ‘‘(ii) the State survey agency finds 

15 that it is more appropriate to take alter16 native action to assure compliance of the 

17 facility with the requirements than to ter18 minate the certification of the facility; and 

19 ‘‘(iii) the State has submitted a plan 

20 and timetable for corrective action to the 

21 Secretary for approval and the Secretary 

22 approves the plan of corrective action.’’. 

23 (e) ACCESS TO INFORMAL DISPUTE RESOLUTION

24 PROCESS.— 
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1 (1) MEDICARE PROGRAM.—Section 1819(g)(1) 

2 of such Act (42 U.S.C. 1395i–3(g)(1)) is amended 

3 by adding at the end the following new subpara4 graph: 

5 ‘‘(F) ESTABLISHMENT OF INFORMAL, 

6 INDEPENDENT DISPUTE RESOLUTION PROC7 ESS.—Each State shall establish an informal 

8 dispute resolution process that allows facilities 

9 to settle disputes involving compliance with the 

10 standards established under this section. Such 

11 process shall rely on independent third parties, 

12 not related to the State survey agency or the 

13 facilities, in resolving disputes.’’. 

14 (2) MEDICAID PROGRAM.—Section 1919(g)(1) 

15 of such Act (42 U.S.C. 1396r(g)(1)) is amended by 

16 adding at the end the following new subparagraph: 

17 ‘‘(F) ESTABLISHMENT OF INFORMAL, 

18 INDEPENDENT DISPUTE RESOLUTION PROC19 ESS.—Each State shall establish an informal 

20 dispute resolution process that allows facilities 

21 to settle disputes involving compliance with the 

22 standards established under this section. Such 

23 process shall rely on independent third parties, 

24 not related to the State survey agency or the 

25 facilities, in resolving disputes.’’. 
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1 (f) REMOVING BARRIERS THAT DETER NEW MAN2 AGEMENT FROM TAKING OVER AND IMPROVING PROB3 LEM FACILITIES.— 

4 (1) MEDICARE PROGRAM.—Section 1819(h) of 

5 such Act (42 U.S.C. 1395i–3(h)) is amended by 

6 adding at the end the following new paragraph: 

7 ‘‘(7) FOSTERING IMPROVEMENT OF FACILITIES

8 WITH POOR COMPLIANCE HISTORIES.—The Sec9 retary shall provide incentives for operators with his10 tories of good compliance to acquire facilities with 

11 poor compliance histories. Such incentives shall be 

12 designed to promote the sustained provision of high13 quality care and shall only be made available in the 

14 case of bona fide, arm’s-length sale of facilities with 

15 poor compliance histories.’’. 

16 (2) MEDICAID PROGRAM.—Section 1919(h) of 

17 such Act (42 U.S.C. 1396r(h)) is amended by add18 ing at the end the following new paragraph: 

19 ‘‘(10) FOSTERING IMPROVEMENT OF FACILI20 TIES WITH POOR COMPLIANCE HISTORIES.—The 

21 Secretary shall provide incentives for operators with 

22 histories of good compliance to acquire facilities with 

23 poor compliance histories. Such incentives shall be 

24 designed to promote the sustained provision of high25 quality care and shall only be made available in the 
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1 case of bona fide, arm’s-length sale of facilities with 

2 poor compliance histories.’’. 

3 (g) ALLOWING APPEALS OF ALL DEFICIENCIES.— 

4 (1) MEDICARE PROGRAM.—Section 1819(h) of 

5 such Act, as amended by subsection (f)(1), is further 

6 amended by adding at the end the following new 

7 paragraph: 

8 ‘‘(8) RIGHT TO APPEAL ALL DEFICIENCY CITA9 TIONS.—Notwithstanding any other provision of law, 

10 a facility may appeal any deficiency determination 

11 under this section with respect to which a penalty 

12 has not been imposed in the same manner as the fa13 cility may appeal such determination if a penalty 

14 had been imposed.’’. 

15 (2) MEDICAID PROGRAM.—Section 1919(h) of 

16 such Act, as amended by subsection (f)(2), is further 

17 amended by adding at the end the following new 

18 paragraph: 

19 ‘‘(11) RIGHT TO APPEAL ALL DEFICIENCY CITA20 TIONS.—Notwithstanding any other provision of law, 

21 a facility may appeal any deficiency determination 

22 under this section with respect to which a penalty 

23 has not been imposed in the same manner as the fa24 cility may appeal such determination if a penalty 

25 had been imposed.’’. 
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1 (h) JOINT PROVIDERS/SURVEYOR TRAINING.— 

2 (1) MEDICARE PROGRAM.—Section 1819(e) of 

3 such Act (42 U.S.C. 1395i–3(e)) is amended by add4 ing at the end the following new paragraph: 

5 ‘‘(6) JOINT PROVIDER/SURVEYOR TRAINING.— 

6 The Secretary shall require the State to establish a 

7 process for joint training and education of surveyors 

8 and providers at least annually and periodically as 

9 changes to regulations, guidelines, and policy gov10 erning nursing facility operations are implemented 

11 and used in surveys of participating facilities.’’. 

12 (2) MEDICAID PROGRAM.—Section 1919(e) of 

13 such Act (42 U.S.C. 1396r(e)) is amended by adding 

14 at the end the following new paragraph: 

15 ‘‘(8) JOINT PROVIDER/SURVEYOR TRAINING.— 

16 The State shall establish a process for joint training 

17 and education to surveyors and providers at least 

18 annually and periodically as changes to regulations, 

19 guidelines, and policy governing nursing facility op20 erations are implemented and used in surveys of 

21 participating facilities.’’ 

22 (i) FACILITY-BASED TRAINING FOR NEW SUR23 VEYORS.— 

24 (1) MEDICARE PROGRAM.—Section 1819(e) of 

25 such Act (42 U.S.C. 1395i–3(e)), as amended by 
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1 subsection (h)(1), is amended by adding at the end 

2 the following new paragraph: 

3 ‘‘(7) FACILITY-BASED TRAINING FOR NEW SUR4 VEYORS.—The Secretary shall require the State to 

5 establish a process for assuring that— 

6 ‘‘(A) each individual newly hired as a nurs7 ing home surveyor, as part of the individual’s 

8 basic training, is assigned full-time to a partici9 pating nursing facility for at least 5 days within 

10 a 7-day period to observe actual operations out11 side of the survey process before the individual 

12 begins oversight responsibilities; 

13 ‘‘(B) such individual shall not assume 

14 oversight responsibility during this training pe15 riod and such observations may not be the sole 

16 basis of a deficiency citation against the facility; 

17 and 

18 ‘‘(C) such individual shall not be assigned 

19 as a member of a survey team for the facility 

20 in which the individual received training for two 

21 standard surveys following the training period 

22 in the facility.’’. 

23 (2) MEDICAID PROGRAM.—Section 1919(e) of 

24 such Act (42 U.S.C. 1396r(e)), as amended by sub-
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1 section (h)(2), is amended by adding at the end the 

2 following new paragraph: 

3 ‘‘(9) FACILITY-BASED TRAINING FOR NEW SUR4 VEYORS.—The State shall establish a process for as5 suring that— 

6 ‘‘(A) each individual newly hired as a nurs7 ing home surveyor, as part of the individual’s 

8 basic training, is assigned full-time to a partici9 pating nursing facility for at least 5 days within 

10 a 7-day period to observe actual operations out11 side of the survey process before the individual 

12 begins oversight responsibilities; 

13 ‘‘(B) such individual shall not assume 

14 oversight responsibility during this training pe15 riod and such observations may not be the sole 

16 basis of a deficiency citation against the facility; 

17 and 

18 ‘‘(C) such individual shall not be assigned 

19 as a member of a survey team for the facility 

20 in which the individual received training for two 

21 standard surveys following the training period 

22 in the facility.’’. 

23 (j) EFFECTIVE DATE.—The amendments made by 

24 this section shall take effect one month after the date of 

25 the enactment of this Act, except in cases where regula-
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1 tions are needed to implement these amendments and in 

2 such cases shall be effective 6 months after such enact3 ment date. 

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