I
107TH CONGRESS
1ST SESSION
H. R. 2677
To amend title XIX of the Social Security Act to improve the quality of
care furnished in nursing homes.
IN THE HOUSE OF REPRESENTATIVES
JULY 30, 2001
Mr. WAXMAN (for himself, Mr. GEPHARDT, Mr. DINGELL, Mr. STARK, Mr.
BROWN of Ohio, Mr. GEORGE MILLER of California, Mr. CARSON of
Oklahoma, Ms. SCHAKOWSKY, Mr. RODRIGUEZ, Mr. BLAGOJEVICH, Mr.
HOEFFEL, Mr. HOLT, Mr. LANTOS, Ms. LEE, Mrs. MALONEY of New
York, Mr. WEXLER, Mr. CLAY, Ms. DELAURO, Mr. EDWARDS, Mr.
EVANS, Mr. HINCHEY, Ms. KAPTUR, Mr. LAMPSON, Mr. MCGOVERN, Mr.
MURTHA, Ms. NORTON, Mr. TIERNEY, Mr. UDALL of New Mexico, and
Mr. WYNN) introduced the following bill; which was referred to the Com-
mittee on Energy and Commerce
A BILL
To amend title XIX of the Social Security Act to improve
the quality of care furnished in nursing homes.
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled,
SECTION 1. SHORT TITLE; TABLE OF CONTENTS.
(a) SHORT TITLE.—This Act may be cited as the
‘‘Nursing Home Quality Protection Act of 2001’’.
(b) TABLE OF CONTENTS.—The table of contents of
this Act is as follows:
Sec. 1. Short title; table of contents.
Sec. 2. Increased resources.
Sec. 3. Increased nurse staffing.
Sec. 4. Increased sanctions.
Sec. 5. Increased public disclosure.
Sec. 6. Background checks.
Sec. 7. Clarification of applicability of protections.
Sec. 8. Financial accountability.
SEC. 2. INCREASED RESOURCES.
(a) PURPOSE.—In 1997, Congress repealed the
Boren amendment, which required that the States make
reasonable and adequate payments to nursing homes and
other health care facilities in order to provide quality care
to residents. The purpose of this section is to restore the
Boren amendment so that those facilities can provide bet-
ter care to residents.
(b) REINSTITUTION OF BOREN AMENDMENT PAY-
MENT METHODOLOGY.—
(1) IN GENERAL.—Section 1902(a)(13) of the
Social Security Act (42 U.S.C. 1396a(a)(13)) is
amended to read as follows:
‘‘(13) provide for payment of services through
the use of rates determined pursuant to the criteria
under this paragraph as in effect on August 1,
1997;’’.
(2) 
ESTABLISHMENT
OF
SAFE
HARBOR
RATES.—Section 1902 of such Act (42 U.S.C.
1396a) is amended by adding at the end the fol-
lowing: ‘‘The Secretary may, by regulation, promul-
gate standards or methodologies for determining
rates that comply with paragraph (13), and a State
that pays rates that meet such standards or meth-
odologies is deemed to be in compliance with para-
graph (13).’’.
(c) EFFECTIVE DATE.—The amendment made by
subsection (b) shall apply to services furnished on or after
the date that is one year after the date of the enactment
of this Act.
SEC. 3. INCREASED NURSE STAFFING.
Section 1919(b)(4) of the Social Security Act (42
U.S.C. 1396r(b)(4)) is amended by adding at the end the
following new subparagraph:
‘‘(D) MINIMUM STAFFING LEVELS.—
‘‘(i) DEADLINE
FOR
COMPLIANCE
WITH MINIMUM STANDARDS.—With respect
to nursing facility services provided after
the date that is the end of the 2-year pe-
riod beginning on the date of the enact-
ment of this subparagraph, a nursing facil-
ity shall comply with the minimum staffing
levels promulgated by the Secretary under
clause (ii).
‘‘(ii) FINAL REGULATIONS.—
‘‘(I) IN
GENERAL.—Not later
than 1 year after the date of the en-
actment of this subparagraph, and
consistent with the provisions of this
clause, the Secretary shall promulgate
standards for minimum staffing levels
for nursing facilities. Such standards
shall be established to ensure that
residents of nursing facilities receive
the level of care necessary to meet the
objectives of subsection (b)(2), and
shall provide for appropriate adjust-
ments to account for resident case
mix.
‘‘(II) MINIMUM
STANDARDS.—
Subject to subclauses (III) and (IV),
standards promulgated under sub-
clause (I) shall be, at a minimum, the
Hartford staffing standards (as de-
fined in clause (v)(I)).
‘‘(III) ALTERNATIVE
MINIMUM
STANDARDS.—Standards promulgated
under subclause (I) may be lower than
the standards described in subclause
(II) if the Secretary determines that
use of the staffing levels under those
standards does not compromise the
ability of facilities to meet the objec-
tives of subsection (b)(2), but in no
case may standards under this sub-
clause be lower than the HHS staffing
standards 
(as 
defined 
in 
clause
(v)(II)).
‘‘(IV) AUTHORITY TO PHASE IN
FACILITY COMPLIANCE WITH STAND-
ARDS.—If the Secretary determines
that compliance with the Hartford
staffing standards is not feasible for
nursing facilities by the end of the 2-
year period applicable under clause
(i), the Secretary may delay the im-
plementation of those Hartford staff-
ing standards until such time as the
Secretary determines such compliance
is feasible. In the interim, facilities
shall comply with standards promul-
gated by the Secretary, such stand-
ards in no case being lower than the
HHS staffing standards.
‘‘(V) EXPLANATION OF EXERCISE
OF AUTHORITY.—If the Secretary de-
cides to exercise the authority under
subclauses (III) or (IV), the Secretary
shall submit to Congress a report de-
scribing the facts and circumstances
of the decision, and shall include the
data and assumptions used in making
that decision and an assessment of
the impact on resident care.
‘‘(iii) FAILURE TO TIMELY PROMUL-
GATE
FINAL
REGULATIONS.—If the Sec-
retary does not publish the final regula-
tions under clause (ii) by the date required
under that clause, effective for services fur-
nished in nursing facilities on or after the
date under clause (ii), such facilities, at a
minimum, shall comply with the Hartford
staffing standards.
‘‘(iv) INCREASE IN PAYMENT RATE.—
Rates applicable to facilities under section
1902(a)(13) shall reflect appropriate ad-
justments for compliance with minimum
standards under this subparagraph.
‘‘(v) DEFINITIONS.—In this subpara-
graph:
‘‘(I) 
HARTFORD
STAFFING
STANDARDS.—The 
term 
‘Hartford
staffing standards’ means the staffing
standards recommended in January
2000 by the Hartford Institute for
Geriatric Nursing and the National
Citizens Coalition for Nursing Home
Reform, appropriately adjusted by the
Secretary to account for resident case
mix.
‘‘(II) HHS 
STAFFING
STAND-
ARDS.—The 
term 
‘HHS 
staffing
standards’ means the preferred min-
imum staffing levels identified in the
report to Congress entitled ‘Appro-
priateness of Minimum Nurse Staff-
ing Ratios in Nursing Homes’ sub-
mitted by the Secretary in the sum-
mer of 2000, appropriately adjusted
by the Secretary to account for resi-
dent case mix.’’.
SEC. 4. INCREASED SANCTIONS.
(a) REFUND
OF
FEDERAL
MONEYS
FOR
SUB-
STANDARD NURSING CARE.—
(1) IN GENERAL.—Section 1919 of the Social
Security Act (42 U.S.C. 1396r) is amended—
(A) by redesignating subsection (i) as sub-
section (j); and
(B) by inserting after subsection (h) the
following new subsection:
‘‘(i) REFUND
OF FEDERAL MONEYS
FOR SUB-
STANDARD NURSING CARE.—
‘‘(1) IN GENERAL.—From amounts paid under
a State plan to a nursing facility, the nursing facil-
ity shall refund to the Secretary for deficiencies
identified in a survey under subsection (g), the fol-
lowing amounts:
‘‘(A) $2,000 for each deficiency that had
the potential to cause more than minimal harm
to a resident of the nursing facility.
‘‘(B) $10,000 for each deficiency that
caused actual harm to a resident of the nursing
facility.
‘‘(C) $25,000 for each deficiency that
placed a resident of the nursing facility in im-
mediate jeopardy.
Amounts under this subparagraph shall be adjusted
annually to account for inflation in the manner pro-
vided for in section 1924(g).
‘‘(2) DEADLINE FOR SUBSTANDARD CARE RE-
FUND.—Payment of the amounts payable by a nurs-
ing facility to the Secretary under paragraph (1)
shall be made not later than 30 days after the nurs-
ing facility receives notice of the deficiencies and the
amount of substandard care refund due.
‘‘(3) WITHHOLDING OF PAYMENTS FOR FAIL-
URE TO PAY A SUBSTANDARD CARE REFUND TO THE
SECRETARY.—In the case of a nursing facility that
does not pay a substandard care refund required
under paragraph (1), in order to ensure that pay-
ments under the State plan to the facility are re-
duced by the amount of substandard care refund
due from the facility, the Secretary shall withhold
from payments attributable to this section the
amount of such substandard care refund, and the
State shall withhold such amount from payments to
that nursing facility.
‘‘(4) APPEAL.—
‘‘(A) IN
GENERAL.—The Secretary shall
establish a procedure for a nursing facility to
appeal to the Secretary a substandard care re-
fund paid or an amount withheld under this
paragraph.
‘‘(B) REPAYMENTS BY THE SECRETARY.—
If a nursing facility is successful on appeal, the
Secretary shall pay to the nursing facility an
amount equal to the amount of the substandard
care refund paid under paragraph (1), or the
amount withheld under paragraph (3), or both,
if applicable, plus interest accruing on such
amount at the rate applicable under section
1903(d)(5).
‘‘(5) RELATION TO OTHER SANCTIONS.—
‘‘(A) IN
GENERAL.—A substandard care
refund paid by or an amount withheld from a
nursing facility for a deficiency under this
paragraph—
‘‘(i) shall not affect the authority of a
State or the Secretary to take enforcement
actions or impose sanctions against the
nursing facility under any other provision
of law with respect to the deficiency;
‘‘(ii)(I) shall be deducted from civil
money penalties otherwise assessed and
collected by the Secretary with respect to
the deficiency under other provisions of
this Act, and
‘‘(II) with respect to the amounts so
deducted 
under 
subclause 
(I), 
those
amounts shall be used only in the same
manner and for the same purposes as such
civil money penalties otherwise assessed
and collected; and
‘‘(iii) shall not affect any remedy
available to an individual at common law.
‘‘(B) PRESERVING
RIGHT
TO
APPEAL.—
The failure of a nursing facility to appeal a
substandard care refund paid by or amount
withheld from the facility for a deficiency under
this paragraph shall have no effect on the right
of the facility to appeal any enforcement action
taken or sanction imposed by the Secretary
with respect to the deficiency under other provi-
sions of this Act.’’.
(2) EFFECTIVE DATE.—The amendments made
by paragraph (1) shall apply with respect to surveys
conducted on or after the date that is one year after
the date of the enactment of this Act, without re-
gard to whether or not final regulations to carry out
such amendments have been promulgated by such
date.
(b) GRANT PROGRAM TO IMPROVE QUALITY
OF
CARE FURNISHED IN NURSING HOMES.—Section 1919 of
the Social Security Act (42 U.S.C. 1396r), as amended
by subsection (a), is further amended—
(1) by redesignating subsection (j) as sub-
section (k); and
(2) by inserting after subsection (i) the fol-
lowing new subsection:
‘‘(j) NURSING FACILITY QUALITY IMPROVEMENT AC-
COUNT.—
‘‘(1) ESTABLISHMENT
OF
NURSING
FACILITY
QUALITY IMPROVEMENT ACCOUNT.—
‘‘(A) IN GENERAL.—There is hereby cre-
ated on the books of the Treasury an expendi-
ture account to be known as the ‘Nursing Facil-
ity Quality Improvement Account’ (in this sub-
section referred to as the ‘Account’).
‘‘(B) DEPOSIT
OF
FUNDS
IN
THE
AC-
COUNT.—The Secretary shall deposit in the
Account—
‘‘(i) all substandard care refunds from
nursing facilities under subsection (i)(1),
other than amounts described in subsection
(i)(5)(A)(ii)(II) (relating to deductions
from civil money penalties); and
‘‘(ii) amounts withheld under sub-
section (i)(3), other than amounts de-
scribed in subsection (i)(5)(A)(ii)(II) (re-
lating to deductions from civil money pen-
alties).
‘‘(C) APPROPRIATED AMOUNTS FROM SUB-
STANDARD CARE REFUNDS.—There are hereby
appropriated to the Account such amounts as
the Secretary deposits to the Account under
this paragraph.
‘‘(2) GRANTS FOR IMPROVEMENT OF QUALITY
OF CARE.—
‘‘(A) IN
GENERAL.—Subject to the suc-
ceeding provisions of this paragraph, from
amounts available in the Account, the Secretary
shall make grants to States for the purpose of
improving the quality of care furnished in nurs-
ing facilities operating in the State.
‘‘(B) USE
OF
GRANT
FUNDS.—Grants
made available to States under subparagraph
(A) may be used for any or all of the following
specified purposes:
‘‘(i) To enable a nursing facility to re-
cruit additional nursing staff or to retain
existing nursing staff (including through
the use of financial incentives).
‘‘(ii) To increase education and train-
ing of nursing staff, including through
educational programs offered by commu-
nity colleges and other institutions of high-
er education.
‘‘(iii) To improve workplace safety for
nursing staff.
‘‘(C) TERMS AND CONDITIONS.—The Sec-
retary shall establish such terms and conditions
as the Secretary determines to be appropriate
for the receipt of grant funds under this para-
graph. Such terms and conditions shall include
the following requirements:
‘‘(i) A State shall develop a plan for
the use of grant funds.
‘‘(ii)(I) In developing the plan re-
quired under clause (i), the State shall es-
tablish advisory councils comprised of rep-
resentatives of nursing facility residents, of
nursing facilities, of nursing staff, and of
other interested parties.
‘‘(II) Such councils shall participate
in determining the manner in which grant
funds are used under the plan, and shall
give priority to proposals for the use of
grant funds that are mutually agreed to by
the representatives of facility residents, of
nursing facilities, and of nursing staff.
‘‘(iii) The State shall submit to the
Secretary annual reports on the use of
grant funds under the plan.
‘‘(D) AGGREGATE
AMOUNT
OF
GRANT
FUNDS FOR STATES.—The amount of a grant
to a State under this subsection may not exceed
the aggregate amount of substandard care re-
funds (under subsection (i)) from nursing facili-
ties operating in the State.
‘‘(E) NONPARTICIPATION
BY
STATES.—
Notwithstanding subparagraph (D), if a State
does not receive a grant under this subsection,
the Secretary may redistribute, in a manner
consistent with section 2104(f), the sub-
standard care refunds received from nursing fa-
cilities in that State to other States.
‘‘(F) LIMITATIONS
ON
USE
OF
GRANT
AMOUNTS.—A State may not use amounts
made available under a grant under this
paragraph—
‘‘(i) to satisfy any requirement for the
expenditure of non-Federal funds as a con-
dition for the receipt of Federal funds; or
‘‘(ii) to make payments to a nursing
facility that is not in compliance with Fed-
eral labor and employment laws or that
has a pattern of violations of such laws.
Amounts made available under a grant under
this paragraph shall be in addition to, and may
not be used to supplant, any funds that are or
would otherwise be expended under any Fed-
eral, State, or local law by a State or local gov-
ernment.
‘‘(G) DEFINITION.—In this subsection and
subsection (g)(5)(E), the term ‘nursing staff’
means a registered professional nurse, a li-
censed practical or licensed vocational nurse, or
a nurse aide.
‘‘(3) ANNUAL AUDITS.—
‘‘(A) IN
GENERAL.—The Secretary shall
conduct annual audits of the use of grant funds
made available under paragraph (2). The Sec-
retary shall assess the extent to which such
funds have resulted in increased nursing staff,
reduced nursing staff turnover, increased train-
ing of nursing staff, and improvements in the
quality of care furnished in nursing facilities lo-
cated in States receiving such grant funds.
‘‘(B) ADDITIONAL TERMS FOR RECEIPT OF
GRANT
FUNDS.—As a part of a plan under
paragraph (2)(C), the State shall afford the
Secretary access to any records or information
relating to the plan for the purposes of an audit
of the State’s use of grant funds.
‘‘(C) ANNUAL
REPORT.—The Secretary
shall submit to Congress an annual report on
the audits conducted under this paragraph.’’.
SEC. 5. INCREASED PUBLIC DISCLOSURE.
(a) INTERNET DISCLOSURE.—Section 1919(g)(5) of
the Social Security Act (42 U.S.C. 1396r(g)(5)) is amend-
ed by adding at the end the following new subparagraph:
‘‘(E) PUBLICATION ON THE INTERNET OF
NURSING FACILITY INFORMATION.—
‘‘(i) 
FACILITY-SPECIFIC
INFORMA-
TION.—As soon as practicable, but in no
case later than 1 year after the date of the
enactment of this subparagraph, the Sec-
retary shall make available to the public on
the Internet site of the Department of
Health and Human Services, and by such
other means as the Secretary determines
appropriate, the following information with
respect to each nursing facility:
‘‘(I) COMPLIANCE WITH FACILITY
STANDARDS.—A summary of the fa-
cility’s compliance or noncompliance
with Federal nursing facility stand-
ards.
‘‘(II) COPIES
OF
RECENT
SUR-
VEYS.—A copy of the three most re-
cent surveys conducted of the nursing
facility under subsection (g).
‘‘(III) 
COMPLAINTS
FILED
AGAINST THE FACILITY.—A summary
of each substantiated complaint filed
against the nursing facility during the
three most recent years and a sum-
mary of the outcome or current status
of the complaint.
‘‘(IV) ENFORCEMENT
ACTIONS
AGAINST THE FACILITY.—A summary
of each enforcement action under-
taken by the Secretary or a State dur-
ing the three most recent years with
respect to the facility and a summary
of the outcome or current status of
the action.
‘‘(V) 
NURSE
STAFFING
RA-
TIOS.—Data on the nursing staff of
the facility for each of the four pre-
vious calendar quarters, including the
following ratios:
‘‘(aa) The ratio of registered
professional nurses to residents
of the facility.
‘‘(bb) The ratio of licensed
practical or licensed vocational
nurses to residents of the facility.
‘‘(cc) The ratio of nurse
aides to residents of the facility.
‘‘(dd) The ratio of aggregate
nursing staff to residents of the
facility.
Such data shall include information
on such ratios by shift. Such ratios
shall be calculated by comparing the
number of hours such staff expend
providing nursing care to residents of
the facility to the number of residents
in the facility.
‘‘(VI) 
OWNERSHIP
DISCLO-
SURE.—The identity of the owner and
operator of the nursing facility, in-
cluding an identification of whether
the facility is a part of a chain of
nursing facilities, and if so, the iden-
tity of the chain and the number of
facilities in such chain.
‘‘(VII) LABOR VIOLATIONS.—Vio-
lations of Federal labor and employ-
ment laws, and costs incurred for ac-
tivities directly related to influencing
employees with respect to unioniza-
tion, during the three most recent
years.
‘‘(VIII) OTHER
PERTINENT
IN-
FORMATION.—Any other information
that the Secretary determines appro-
priate to inform the public on condi-
tions and quality of care furnished at
the facility.
After the date of the enactment of this
clause, the Secretary shall continuously up-
date the information posted on such Inter-
net site and shall ensure that such infor-
mation is never more than 90 days out of
date.
‘‘(ii) ESTABLISHMENT AND PUBLICA-
TION OF RATING SYSTEM.—The Secretary
shall establish and implement a rating sys-
tem to compare the quality of care fur-
nished to residents by nursing facilities.
Such system shall be based on the infor-
mation under clause (i), case mix of resi-
dents of the facility, and such other infor-
mation as the Secretary determines appro-
priate to provide for meaningful ratings of
quality of care furnished among facilities.’’.
(b) POSTING OF STAFFING INFORMATION.—Section
1919(c)(8) of the Social Security Act (42 U.S.C.
1396r(c)(8)) is amended by inserting before the period the
following: ‘‘and the nurse staffing ratio information under
subsection (g)(5)(E)(v)’’.
(c) RECORDKEEPING
AND REPORTING REQUIRE-
MENTS.—Section 1919(d) of the Social Security Act (42
U.S.C. 1396r(d)) is amended by adding at the end the
following new paragraph:
‘‘(5) RECORDKEEPING
AND
REPORTING
RE-
QUIREMENTS.—
‘‘(A) IN
GENERAL.—A nursing facility
shall maintain such records and make such re-
ports to the Secretary as the Secretary may re-
quire for the administration and enforcement of
this section, including providing to the Sec-
retary such information as the Secretary may
require to implement subsection (g)(5)(E). The
Secretary may specify the form and manner of
any report required under this section, and
shall establish a procedure for the electronic
transmission of such records.
‘‘(B) CERTIFICATION.—A report required
under this paragraph shall be certified by the
administrator of the nursing facility as being
true, accurate, and complete.’’.
SEC. 6. BACKGROUND CHECKS.
(a) IN GENERAL.—Section 1919(d) of the Social Se-
curity Act (42 U.S.C. 1396r(d)) is amended by adding at
the end the following new paragraph:
‘‘(5) PROHIBITION ON EMPLOYMENT OF CER-
TAIN INDIVIDUALS.—
‘‘(A) BACKGROUND
CHECK
ON
EMPLOY-
EES.—Beginning 1 year after the date of the
enactment of this paragraph, each nursing facil-
ity shall conduct a background check on each
covered employee hired by the facility. The
background check shall include a check of all
relevant Federal and State databases that con-
tain information on—
‘‘(i) violations of Federal or State
criminal law,
‘‘(ii) abuse of residents of nursing fa-
cilities, or misappropriation of resident
property,
‘‘(iii) abuse of hospital patients, or
any other group of patients that the Sec-
retary may specify, or misappropriation of
patient property, and
‘‘(iv) abuse of children.
‘‘(B) PROHIBITION ON EMPLOYMENT.—
‘‘(i) IN GENERAL.—A nursing facility
may 
not 
knowingly 
hire 
a 
covered
employee—
‘‘(I) who has been convicted of a
felony under Federal or State law for
any offense described in paragraphs
(1) through (4) of section 1128(a);
‘‘(II) with respect to whom a
Federal or State department or agen-
cy has made a specific documented
finding of resident or patient abuse,
misappropriation of resident or pa-
tient property, or child abuse; or
‘‘(III) who has been found to
have committed any other offense that
the Secretary specifies in regulations.
‘‘(ii) AUTHORITY
FOR
EXCEPTIONS
FOR
SPECIFIC
FACTORS.—The Secretary
may provide for limited exceptions to the
prohibition under clause (i) based on the
severity of the offense or finding or the pe-
riod of time that has elapsed since the of-
fense or finding occurred and the conduct
of the background check.
‘‘(C) EMPLOYEE APPEAL.—A covered em-
ployee, or a candidate for employment, may ap-
peal (under a procedure similar to petitions
under subsection (g)(1)(D)) to the State in
which the facility is located a decision of a
nursing facility to terminate, or deny, employ-
ment of the covered employee or candidate in
the facility based on erroneous information re-
vealed in the background check.
‘‘(D) PROHIBITION
ON
CHARGING
EM-
PLOYEE FOR COST OF BACKGROUND CHECK.—
A nursing facility that conducts a background
check on a covered employee, or a candidate for
employment, may not directly or indirectly re-
coup the cost of performing such background
check from the employee or candidate.
‘‘(E) DEFINITION.—In this paragraph, the
term ‘covered employee’ means any individual
who under an employment contract or arrange-
ment with a nursing facility furnishes health
care items and services, or furnishes other serv-
ices in the facility in areas of the facility where
residents are present, and who is hired on or
after the date that is one year before the date
of the enactment of this paragraph.’’.
(b) PROCEDURE FOR BACKGROUND CHECKS.—The
Secretary of Health and Human Services shall, by regula-
tion, establish uniform procedures—
(1) for a nursing facility receiving payments
under a State plan under title XIX of the Social Se-
curity Act to conduct background checks under sub-
paragraph (A) of section 1919(d)(5) of such Act, as
added by subsection (a); and
(2) for a covered employee, or a candidate for
employment, to appeal under subparagraph (C) of
that section an employment action of a nursing facil-
ity to the State in which the facility is located.
SEC. 7. CLARIFICATION OF APPLICABILITY OF PROTEC-
TIONS.
(a) SURVEY AND CERTIFICATION.—Section 1919(g)
of the Social Security Act (42 U.S.C. 1396r(g)) is amend-
ed by adding at the end the following new paragraph:
‘‘(6) APPLICABILITY OF PROTECTIONS TO ALL
RESIDENTS.—The provisions of this subsection shall
apply to all residents of a nursing facility, without
regard to whether—
‘‘(A) the resident is entitled to have pay-
ment made for nursing facility services under
the State plan or under any other provision of
this Act, or
‘‘(B) the facility is a distinct part of an in-
stitution under subsection (a).’’.
(b) ENFORCEMENT.—Section 1919(h) of such Act
(42 U.S.C. 1396r(h)) is amended by adding at the end
the following new paragraph:
‘‘(10) APPLICABILITY OF PROTECTIONS TO ALL
RESIDENTS.—The provisions of this subsection shall
apply to all residents of a nursing facility, without
regard to whether—
‘‘(A) the resident is entitled to have pay-
ment made for nursing facility services under
the State plan or under any other provision of
this Act, or
‘‘(B) the facility is a distinct part of an in-
stitution under subsection (a).’’.
SEC. 8. FINANCIAL ACCOUNTABILITY.
(a) IN GENERAL.—Section 1919(g)(2) of the Social
Security Act (42 U.S.C. 1396r(g)(2)) is amended—
(1) by redesignating subparagraphs (C), (D),
and (E) as subparagraphs (D), (E), and (F); and
(2) by inserting after subparagraph (B) the fol-
lowing new subparagraph:
‘‘(C) 
FINANCIAL
ACCOUNTABILITY.—A
standard or an extended survey may include an
examination of the financial records of a facility
to determine whether payments made to the fa-
cility under this section for services furnished to
residents are being used in a manner consistent
with this section.’’.
(b) EFFECTIVE DATE.—The amendment made by
subsection (a) shall apply to surveys conducted on or after
the date of the enactment of this Act.
Æ