Nursing Home Reform: Continued Attention Is Needed to Improve Quality of Care in Small but Significant Share of Homes
Published: 2007-05-02T00:00:00

Fast Facts:

Highlights:
section_title: Why GAO Did This Study
paragraphs: With the Omnibus Budget Reconciliation Act of 1987 (OBRA '87), Congress responded to growing concerns about the quality of care that nursing home residents received by requiring reforms in the federal certification and oversight of nursing homes. These reforms included revising care requirements that homes must meet to participate in the Medicare or Medicaid programs, modifying the survey process for certifying a home's compliance with federal standards, and introducing additional sanctions and decertification procedures for noncompliant homes. GAO's testimony addresses its work in evaluating the quality of nursing home care and the enforcement and oversight functions intended to ensure high-quality care, the progress made in each of these areas since the passage of OBRA '87, and the challenges that remain. GAO's testimony is based on its prior work; analysis of data from the Centers for Medicare & Medicaid Services' (CMS) On-Line Survey, Certification, and Reporting system (OSCAR), which compiles the results of state nursing home surveys; and evaluation of federal comparative surveys for selected states (2005-2007). Federal comparative surveys are conducted at nursing homes recently surveyed by each state to assess the adequacy of the state's surveys.
section_title: What GAO Found
paragraphs: The reforms of OBRA '87 and subsequent efforts by CMS and the nursing home industry to improve the quality of nursing home care have focused on resident outcomes, yet a small but significant share of nursing homes nationwide continue to experience quality-of-care problems. In fiscal year 2006, almost one in five nursing homes was cited for serious deficiencies, those that caused actual harm or placed residents in immediate jeopardy. While this rate has fluctuated over the last 7 years, GAO has found persistent variation in the proportion of homes with serious deficiencies across states. In addition, although the understatement of serious deficiencies--that is, when federal surveyors identified deficiencies that were missed by state surveyors--has declined since 2004 in states GAO reviewed, it has continued at varying levels. CMS has strengthened its enforcement capabilities since OBRA '87 in order to better ensure that nursing homes achieve and maintain high-quality care, but several key initiatives require refinement. CMS has implemented additional sanctions authorized in the legislation, established an immediate sanctions policy for homes found to repeatedly harm residents, and developed a new enforcement management data system. However, the immediate sanctions policy is complex and appears to have induced only temporary compliance in some homes with a history of repeated noncompliance. Furthermore, CMS's new data system's components are not integrated and national reporting capabilities are incomplete, which hamper CMS's ability to track and monitor enforcement. CMS oversight of nursing home quality has increased significantly, but CMS initiatives continue to compete for staff and financial resources. Attention to oversight has led to greater demand on limited resources, and to queues and delays in certain key initiatives. For example, a new survey methodology has been in development for over 8 years and resource constraints threaten the planned expansion of this methodology beyond the initial demonstration states. Significant attention from the Special Committee on Aging, the Institute of Medicine, and others served as a catalyst to focus national attention on nursing home quality issues, culminating in the nursing home reform provisions of OBRA '87. In response to many GAO recommendations and at its own initiative, CMS has taken many important steps; however, the task of ensuring high-quality nursing home care for all residents is not complete. In order to guarantee that all nursing home residents receive high-quality care, it is important to maintain the momentum begun by the reforms of OBRA '87 and continue to focus national attention on those homes that cause actual harm to vulnerable residents.

section_title: Letter
paragraphs: I am pleased to be here today as you acknowledge the 20th anniversary of  the passage of the Omnibus Budget Reconciliation Act of 1987 (OBRA ‘87),  which contained nursing home reform provisions. In March 1986, the  National Academy of Sciences’ Institute of Medicine (IOM) released a  report concluding that quality of care and quality of life in many nursing  homes were not satisfactory, despite the existence of government  regulation, and that more effective government regulation could  substantially improve nursing home quality. In July 1987, we issued a  report recommending that Congress pass legislation that would strengthen  enforcement of federal nursing home requirements, consistent with the  IOM’s recommendations. Largely in response to these reports, Congress  passed the nursing home reform provisions of OBRA ‘87, which was  significant in that it changed the focus of quality standards from a home’s  capability to provide care to its actual delivery of care and resident  outcomes. OBRA ‘87 directed the Health Care Financing Administration,  now known as the Centers for Medicare & Medicaid Services (CMS), to  reform its certification and oversight of nursing homes for Medicare and  Medicaid, which includes surveys to ensure the quality of resident care,  complaint investigations, and remedies and penalties for nursing homes  not in compliance with federal standards.
The nation’s 1.5 million nursing home residents are a highly vulnerable  population of elderly and disabled individuals for whom remaining at  home is no longer feasible. With the aging of the baby boom generation,  the number of individuals needing nursing home care and the associated  costs are expected to increase dramatically. Combined Medicare and  Medicaid payments for nursing home services were about $72.7 billion in  2005, including a federal share of about $49 billion. The federal  government plays a key role in ensuring that nursing home residents  receive appropriate care by setting quality-of-care, quality-of-life, and life  safety requirements that nursing homes must meet to participate in the  Medicare and Medicaid programs and by contracting with states to  routinely inspect homes and conduct complaint investigations. To  encourage compliance with these requirements, Congress has authorized  certain enforcement actions.
Since this Committee requested us to investigate California nursing homes  in 1997, we have reported to Congress and testified numerous times on the  quality of resident care, identified significant weaknesses in federal and  state activities designed to detect and correct quality problems in nursing  homes, and made many recommendations to improve the survey process  and federal oversight of nursing home quality. In response to our  recommendations as well as needed improvements CMS identified in its  own self-assessment in 1998, CMS announced a set of initiatives intended  to address many of these weaknesses. Over time, CMS has refined and  expanded these initiatives in order to continue to improve nursing home  quality.
My remarks today will focus on GAO’s work in evaluating the quality of  nursing home care and the enforcement and oversight functions intended  to ensure high-quality care. I will address the progress made in these three  areas since OBRA ‘87, as well as the challenges that remain. This  statement is based primarily on prior GAO work. In addition, we  interviewed CMS officials; analyzed data from CMS’s On-Line Survey,  Certification, and Reporting system (OSCAR), which compiles the results  of state nursing home surveys; and evaluated the results of federal  comparative surveys for selected states for the period January 2005  through March 2007. Federal comparative surveys are conducted at  nursing homes recently surveyed by each state to assess the adequacy of  the state’s surveys. We considered these data sufficiently reliable for our  purposes. We discussed the highlights of this statement including our new  analyses with CMS officials, and they provided us additional information,  which we incorporated as appropriate. We conducted our work from  March through April 2007 in accordance with generally accepted  government auditing standards.
In summary, despite the reforms of OBRA ‘87 and subsequent efforts by  CMS and the nursing home industry to improve the quality of nursing  home care, a small but significant share of nursing homes nationwide  continues to experience quality-of-care problems. In 2006, one in five  nursing homes nationwide was cited for serious deficiencies—those  deficiencies that cause actual harm or place residents in immediate  jeopardy. While this rate has fluctuated over the last 7 years, we have  regularly found (1) significant variation across states in their citation of  serious deficiencies, indicating inconsistencies in states’ assessments of  quality of care and (2) understatement of these deficiencies—when  deficiencies are found on federal comparative surveys but not cited on  corresponding state surveys. Among the five large states we reviewed— California, Florida, New York, Ohio, and Texas—understatement of  serious deficiencies has declined from 18 percent prior to December 2004  to 11 percent for the most recent time period ending in March 2007, but  understatement has continued at varying levels.
Since the passage of OBRA ‘87, CMS has strengthened its enforcement  capabilities—for example, by implementing sanctions authorized in the  legislation, establishing an immediate sanctions policy for nursing homes  found to repeatedly harm residents, and developing a new enforcement  management data system—but several key initiatives require refinement.  The immediate sanctions policy is complex and appears to have induced  only temporary compliance in certain nursing homes with histories of  repeated noncompliance. In addition, the term “immediate sanctions”  policy is misleading because it requires only that homes be notified  immediately of CMS’s intent to implement sanctions, not that sanctions be  implemented immediately. Furthermore, when a sanction, such as a denial  of payment for new admissions (DPNA), is implemented, there is a lag  time between when the deficiency citation occurs and the effective date of  the sanction. Finally, although CMS has developed a new data system, the  system’s components are not integrated and the national reporting  capabilities are incomplete, hampering the agency’s ability to track and  monitor enforcement.
CMS oversight of nursing home quality and state surveys has increased  since OBRA ‘87, but certain key initiatives continue to compete for  resources. To increase its oversight of quality of care in nursing homes,  CMS has focused its resources and attention in areas such as prompt  investigation of complaints and allegations of abuse, more frequent federal  comparative surveys, stronger fire safety standards, and upgrades to data  systems. However, this increased emphasis on nursing home oversight  coupled with growth in the number of Medicare and Medicaid providers  has caused greater demand on limited resources, which, in turn, has led to  queues and delays in certain key initiatives. For example, the  implementation of a new survey methodology, the Quality Indicator  Survey (QIS), has been in development for over 8 years and resource  constraints threaten the planned expansion of this methodology beyond  the initial five demonstration states.
Significant attention from the Special Committee on Aging, the Institute of  Medicine, and others served as a catalyst to focus national attention on  nursing home quality issues, culminating in the nursing home reform  provisions of OBRA ‘87. Since then, in response to many GAO  recommendations and at its own initiative, CMS has taken many important  steps to respond in a timelier, more rigorous, more consistent manner to  identified problems. Nevertheless, the task of ensuring high-quality  nursing home care is still not complete. To guarantee that all nursing home  residents receive high-quality care, it is important to maintain the  momentum begun by the reforms of OBRA ‘87 and continue to focus  national attention on those homes that cause actual harm to vulnerable  residents.
subsections: section_title: Background
paragraphs: Titles XVIII and XIX of the Social Security Act establish minimum  requirements that all nursing homes must meet to participate in the  Medicare and Medicaid programs, respectively. With the passage of OBRA  ‘87, Congress responded to growing concerns about the quality of care that  nursing home residents received by requiring major reforms in the federal  regulation of nursing homes. Among other things, these reforms revised  care requirements that facilities must meet to participate in the Medicare  or Medicaid programs, modified the survey process for certifying a home’s  compliance with federal standards, and introduced additional sanctions  and decertification procedures for homes that fail to meet federal  standards. Following OBRA ‘87, CMS published a series of regulations and  transmittals to implement the changes. Key implementation actions have  included the following: In October 1990, CMS implemented new survey  standards; in July 1995, it established enforcement actions for nursing  homes found to be out of compliance; and it enhanced oversight through  more rigorous federal monitoring surveys beginning in October 1998 and  annual state performance reviews in fiscal year 2001. CMS has continued  to revise and refine many of these actions since their initial  implementation.
subsections: section_title: Survey Process
paragraphs: Every nursing home receiving Medicare or Medicaid payment must  undergo a standard survey not less than once every 15 months, and the  statewide average interval for these surveys must not exceed 12 months.  During a standard survey, separate teams of surveyors conduct a  comprehensive assessment of federal quality-of-care and life safety  requirements. In contrast, complaint investigations, also conducted by  surveyors, generally focus on a specific allegation regarding resident care  or safety.
The quality-of-care component of a survey focuses on determining  whether (1) the care and services provided meet the assessed needs of the  residents and (2) the home is providing adequate quality care, including  preventing avoidable pressure sores, weight loss, and accidents. Nursing  homes that participate in Medicare and Medicaid are required to  periodically assess residents’ care needs in 17 areas, such as mood and  behavior, physical functioning, and skin conditions, in order to develop an  appropriate plan of care. Such resident assessment data are known as the  minimum data set (MDS). To assess the care provided by a nursing home,  surveyors select a sample of residents and (1) review data derived from  the residents’ MDS assessments and medical records; (2) interview nursing  home staff, residents, and family members; and (3) observe care provided  to residents during the course of the survey. CMS establishes specific  investigative protocols for state survey teams—generally consisting of  registered nurses, social workers, dieticians, and other specialists—to use  in conducting surveys. These procedural instructions are intended to make  the on-site surveys thorough and consistent across states.
The life safety component of a survey focuses on a home’s compliance  with federal fire safety requirements for health care facilities. The fire  safety requirements cover 18 categories, ranging from building  construction to furnishings. Most states use fire safety specialists within  the same department as the state survey agency to conduct fire safety  inspections, but some states contract with their state fire marshal’s office.
Complaint investigations provide an opportunity for state surveyors to  intervene promptly if problems arise between standard surveys.  Complaints may be filed against a home by a resident, the resident’s  family, or a nursing home employee either verbally, via a complaint  hotline, or in writing. Surveyors generally follow state procedures when  investigating complaints but must comply with certain federal guidelines  and time frames. In cases involving resident abuse, such as pushing,  slapping, beating, or otherwise assaulting a resident by individuals to  whom their care has been entrusted, state survey agencies may notify state  or local law enforcement agencies that can initiate criminal investigations.  States must maintain a registry of qualified nurse aides, the primary  caregivers in nursing homes, that includes any findings that an aide has  been responsible for abuse, neglect, or theft of a resident’s property. The  inclusion of such a finding constitutes a ban on nursing home  employment.
Effective July 1995, CMS established a classification system for  deficiencies identified during either standard surveys or complaint  investigations. Deficiencies are classified in 1 of 12 categories according to  their scope (i.e., the number of residents potentially or actually affected)  and their severity. An A-level deficiency is the least serious and is isolated  in scope, while an L-level deficiency is the most serious and is considered  to be widespread in the nursing home (see table 1). States are required to  enter information about surveys and complaint investigations, including  the scope and severity of deficiencies identified, in CMS’s OSCAR  database.
section_title: Enforcement
paragraphs: In an effort to better ensure that nursing homes achieve and maintain  compliance with the new survey standards, OBRA ‘87 expanded the range  of enforcement sanctions. Prior to OBRA ‘87, the only sanctions available  were terminations from Medicare or Medicaid or, under certain  circumstances, DPNAs. OBRA ‘87 added several new alternative sanctions,  such as civil money penalties (CMP) and requiring training for staff  providing care to residents, and expanded the types of deficiencies that  could result in DPNAs. To implement OBRA ‘87, CMS published  enforcement regulations, effective July 1995. According to these  regulations, the scope and severity of a deficiency determine the  applicable sanctions. CMS imposes sanctions on homes with Medicare or  dual Medicare and Medicaid certification on the basis of state referrals.  CMS normally accepts a state’s recommendation for sanctions but can  modify it.
Effective January 2000, CMS required states to refer for immediate  sanction homes found to have harmed one or a small number of residents  or to have a pattern of harming or exposing residents to actual harm or  potential death or serious injury (G-level or higher deficiencies on the  agency’s scope and severity grid) on successive surveys. This is known as  the double G immediate sanctions policy. Additionally, in January 1999,  CMS launched the Special Focus Facility program. This initiative was  intended to increase the oversight of homes with a history of providing  poor care. When CMS established this program, it instructed each state to  select two homes for enhanced monitoring. For these homes, states are to  conduct surveys at 6-month intervals rather than annually. In December  2004, CMS expanded this program to require immediate sanctions for  those homes that fail to significantly improve their performance from one  survey to the next and termination for homes with no significant  improvement after three surveys over an 18-month period.
Unlike other sanctions, CMPs do not require a notification period before  they go into effect. However, if a nursing home appeals the deficiency, by  statute, payment of the CMP—whether received directly from the home or  withheld from the home’s Medicare and Medicaid payments—is deferred  until the appeal is resolved. In contrast to CMPs, other sanctions,  including DPNAs, cannot go into effect until homes have been provided a  notice period of at least 15 days, according to CMS regulations; the notice  period is shortened to 2 days in the case of immediate jeopardy. Although  nursing homes can be terminated involuntarily from participation in  Medicare and Medicaid, which can result in a home’s closure, termination  is used infrequently.
section_title: Oversight
paragraphs: CMS is responsible for overseeing each state survey agency’s performance  in ensuring quality of care in nursing homes participating in Medicare or  Medicaid. Its primary oversight tools are (1) statutorily required federal  monitoring surveys and (2) annual state performance reviews. Pursuant to  OBRA ‘87, CMS is required to conduct annual monitoring surveys in at  least 5 percent of the state-surveyed Medicare and Medicaid nursing  homes in each state, with a minimum of five facilities in each state. These  federal monitoring surveys can be either comparative or observational. A  comparative survey involves a federal survey team conducting a complete,  independent survey of a home within 2 months of the completion of a  state’s survey in order to compare and contrast the findings. In an  observational survey, one or more federal surveyors accompany a state  survey team to a nursing home to observe the team’s performance. State  performance reviews measure state survey agency compliance with seven  standards: timeliness of the survey, documentation of survey results,  quality of state agency investigations and decision making, timeliness of  enforcement actions, budget analysis, timeliness and quality of complaint  investigations, and timeliness and accuracy of data entry. These reviews  replaced state self-reporting of their compliance with federal  requirements.
section_title: Quality of Care Remains a Problem for a Small but Significant Proportion of Nursing Homes Nationwide
paragraphs: A small but significant proportion of nursing homes nationwide continue  to experience quality-of-care problems—as evidenced by the almost 1 in 5  nursing homes nationwide that were cited for serious deficiencies in  2006—despite the reforms of OBRA ‘87 and subsequent efforts by CMS  and the nursing home industry to improve the quality of nursing home  care. Although there has been an overall decline in the numbers of nursing  homes found to have serious deficiencies since fiscal year 2000, variation  among states in the proportion of homes with serious deficiencies  indicates state survey agencies are not consistently conducting surveys.  Challenges associated with the recruitment and retention of state  surveyors, combined with increased surveyor workloads, can affect survey  consistency. In addition, federal comparative surveys conducted after  state surveys found more serious quality-of-care problems than were cited  by state surveyors. Although understatement of serious deficiencies  identified by federal surveyors in five states has declined since 2004,  understatement continues at varying levels across these states.
CMS data indicate an overall decline in reported serious deficiencies from  fiscal year 2000 through 2006. The proportion of nursing homes  nationwide cited with serious deficiencies declined from 28 percent in  fiscal year 2000 to a low of 16 percent in 2004, and then increased to   19 percent in fiscal year 2006 (see fig. 1).
Despite this national trend, significant interstate variation in the  proportion of homes with serious deficiencies indicates that states  conduct surveys inconsistently. (App. II shows the percentage of homes,  by state, cited for serious deficiencies in standard surveys across a 7-year  period.). In fiscal year 2006, 6 states identified serious deficiencies in   30 percent or more of homes surveyed, 16 states found such deficiencies  in 20 to 30 percent of homes, 22 found these deficiencies in 10 to   19 percent of homes, and 7 found these deficiencies in less than 10 percent  of homes. For example, in fiscal year 2006, the percentage of nursing  homes cited for serious deficiencies ranged from a low of approximately   2 percent in one state to a high of almost 51 percent in another state.
The inconsistency of state survey findings may reflect challenges in  recruiting and retaining state surveyors and increasing state surveyor  workloads. We reported in 2005 that, according to state survey agency  officials, it is difficult to retain surveyors and fill vacancies because state  survey agency salaries are rarely competitive with the private sector.  Moreover, the first year for a new surveyor is essentially a training period  with low productivity. It can take as long as 3 years for a surveyor to gain  sufficient knowledge, experience, and confidence to perform the job well.  We also reported that limited experience levels of state surveyors resulting  from high turnover rates was a contributing factor to (1) variability in  citing actual harm or higher-level deficiencies and (2) understatement of  such deficiencies. In addition, the implementation of CMS’s nursing home  initiatives has increased state survey agencies’ workload. States are now  required to conduct on-site revisits to ensure serious deficiencies have  been corrected, promptly investigate complaints alleging actual harm on- site, and initiate off-hour standard surveys in addition to quality-of-care  surveys. As a result, surveyor presence in nursing homes has increased  and surveyor work hours have effectively been expanded to weekends,  evenings, and early mornings.
In addition, data from federal comparative surveys indicate that quality-of- care problems remain for a significant proportion of nursing homes. In  fiscal year 2006, 28 percent of federal comparative surveys found more  serious deficiencies than did state quality-of-care surveys. Since 2002,  federal surveyors have found serious deficiencies in 21 percent or more of  comparative surveys that were not cited in corresponding state quality-of- care surveys (see fig. 2). However, some serious deficiencies found by  federal, but not state surveyors, may not have existed at the time the state  survey occurred.
In December 2005, we reported on understatement of serious deficiencies  in five states—California, Florida, New York, Ohio, and Texas—from  March 2002 through December 2004. We selected these states for our  analysis because the percentage of their state surveys that cited serious  deficiencies decreased significantly from January 1999 through January  2005. Our analysis of more recent data from these states showed that  understatement of serious deficiencies continues at varying levels.  Altogether, we examined 139 federal comparative surveys conducted from  March 2002 through March 2007 in the five states. Understatement of  serious deficiencies decreased from 18 percent for federal comparative  surveys during the original time period to 11 percent for federal  comparative surveys during the period January 2005 through March 2007.
Federal comparative surveys for Florida and Ohio for this most recent  time period found that state surveys had not missed any serious  deficiencies; however, since 2004 all five states experienced increases in  the percentage of homes cited with serious deficiencies on state surveys  (see app. II). Understatement of serious deficiencies varied across these  five states, as the percentage of serious missed deficiencies ranged from a  low of 4 percent in Ohio to a high of 26 percent in New York during the 5- year period March 2002 to March 2007. Figure 3 summarizes our analysis  by state, from March 2002 through March 2007.
section_title: CMS Has Strengthened Its Enforcement Capabilities, although Key Initiatives Still Need Refinement
paragraphs: CMS has strengthened its enforcement capabilities since OBRA ‘87 by, for  example, implementing additional sanctions and an immediate sanctions  policy for nursing homes found to repeatedly harm residents and  developing a new enforcement management data system; however, several  key initiatives require refinement. The immediate sanctions policy is  complex and appears to have induced only temporary compliance in  certain nursing homes with histories of repeated noncompliance. The term  “immediate sanctions” is misleading because the policy requires only that  homes be notified immediately of CMS’s intent to implement sanctions,  not that sanctions must be implemented immediately. Furthermore, when  a sanction is implemented, there is a lag time between when the deficiency  citation occurs and the sanction’s effective date. In addition to the  immediate sanctions policy, CMS has taken other steps that are intended  to address enforcement weaknesses, but their effectiveness remains  unclear. Finally, although CMS has developed a new data system, the  system’s components are not integrated and the national reporting  capabilities are incomplete, hampering the agency’s ability to track and  monitor enforcement.
subsections: section_title: Despite Changes in Federal Enforcement Policy, Immediate Sanctions Do Not Always Deter Noncompliance and Often Are Not Immediate
paragraphs: Despite CMS’s efforts to strengthen federal enforcement policy, it has not  deterred some homes from repeatedly harming residents. Effective  January 2000, CMS implemented its double G immediate sanctions policy.  The policy is complex and does not always appear to deter  noncompliance, nor are the sanctions always implemented immediately.  We recently reported that the immediate sanctions policy’s complex rules,  and the exceptions they include, allowed homes to escape immediate  sanctions even if they repeatedly harmed residents. CMS acknowledged  that the complexity of the policy may be an inherent limitation and  indicated that it intends to either strengthen the policy or replace it with a  policy that achieves similar goals through alternative methods.
In addition to the complexity of the policy, it does not appear to always  deter noncompliance. We recently reported that our review of 63 homes  with prior serious quality problems in four states indicated that sanctions  may have induced only temporary compliance in these homes because  surveyors found that many of the homes with implemented sanctions were  again out of compliance on subsequent surveys. From fiscal year 2000  through 2005, 31 of these 63 homes cycled in and out of compliance more  than once, harming residents, even after sanctions had been implemented,  including 8 homes that did so seven times or more. During this same time  period, 27 of the 63 homes were cited 69 times for deficiencies that  warranted immediate sanctions, but 15 of these cases did not result in  immediate sanctions.
We also recently reported that the term “immediate sanctions” is  misleading because the policy is silent on how quickly sanctions should be  implemented and there is a lag time between the state’s identification of  deficiencies during the survey and when the sanction (i.e., a CMP or  DPNA) is implemented (i.e., when it goes into effect). The immediate  sanctions policy requires that sanctions be imposed immediately. A  sanction is considered imposed when a home is notified of CMS’s intent to  implement a sanction—15 days from the date of the notice. If during the  15-day notice period the nursing home corrects the deficiencies, no  sanction is implemented. Thus, nursing homes have a de facto grace  period. In addition, there is a lag time between the state’s identification of  deficiencies and the implementation of a sanction. CMS implemented  about 68 percent of the DPNAs for double Gs among the homes we  reviewed during fiscal year 2000 through 2005 more than 30 days after the  survey. In contrast, CMPs can go into effect as early as the first day the  home was out of compliance, even if that date is prior to the survey date  because, unlike DPNAs, CMPs do not require a notice period. About   98 percent of CMPs imposed for double Gs took effect on or before the  survey date. However, the deterrent effect of CMPs was diluted because  CMS imposed CMPs at the lower end of the allowable range for the homes  we reviewed. For example, the median per day CMP amount imposed for  deficiencies that do not cause immediate jeopardy to residents was $500 in  fiscal year 2000 through 2002 and $350 in fiscal year 2003 through 2005; the  allowable range is $50 to $3,000 per day.
Although CMPs can be implemented closer to the date of survey than  DPNAs, the immediacy and the effect of CMPs may be diminished by   (1) the significant time that can pass between the citation of deficiencies  on a survey and the home’s payment of the CMP and (2) the low amounts  imposed, as described earlier. By statute, payment of CMPs is delayed  until appeals are exhausted. For example, one home we reviewed did not  pay its CMP of $21,600 until more than 2 years after a February 2003  survey had cited a G-level deficiency. This citation was a repeat deficiency:  less than a month earlier, the home had received another G-level  deficiency in the same quality-of-care area. This finding is consistent with  a 2005 report from the Department of Health and Human Services’ (HHS)  Office of Inspector General that found that the collection of CMPs in  appealed cases takes an average of 420 days—a 110 percent increase in  time over nonappealed cases—and “consequently, nursing homes are  insulated from the repercussions of enforcement by well over a year.”
CMS has taken additional steps intended to improve enforcement of  nursing home quality requirements; however, the extent to which—or  when—these initiatives will address enforcement weaknesses remains  unclear. First, to ensure greater consistency in CMP amounts proposed by  states and imposed by regions, CMS, in conjunction with state survey  agencies, developed a grid that provides guidance for states and regions.  The CMP grid lists ranges for minimum CMP amounts while allowing for  flexibility to adjust the penalties for factors such as the deficiency’s scope  and severity, the care areas where the deficiency was cited, and a home’s  past history of noncompliance. In August 2006, CMS completed the  regional office pilot of its CMP grid but had not completed its analysis of  the pilot as of April 2007. CMS plans to disseminate the final grid to states  soon. Second, in December 2004, CMS expanded the Special Focus  Facility program from about 100 homes to include about 135 homes. CMS  also modified the program by requiring immediate sanctions for those  homes that failed to significantly improve their performance from one  survey to the next and by requiring termination for homes with no  significant improvement after three surveys over an 18-month period.  According to CMS, 11 Special Focus Facilities were terminated in fiscal  year 2005 and 7 were terminated in fiscal year 2006. Despite the expansion  of the program, many homes that could benefit from enhanced oversight  and enforcement are still excluded from the program. For example, of the  63 homes with prior serious quality problems that we recently reviewed,  only 2 were designated Special Focus Facilities in 2005, and the number  increased to 4 in 2006.
section_title: While CMS Collects Valuable Enforcement Data, Its Enforcement Monitoring Data Systems Need Improvement
paragraphs: In March 1999, we reported that CMS lacked a system for effectively  integrating enforcement data nationwide and that the lack of such a  system weakened oversight. Since 1999, CMS has made progress  developing such a system—ASPEN Enforcement Manager (AEM)—and,  since October 1, 2004, CMS has used AEM to collect state and regional  data on sanctions and improve communications between state survey  agencies and CMS regional offices. CMS expects that the data collected in  AEM will enable states, CMS regional offices, and the CMS central office  to more easily track and evaluate sanctions against nursing homes as well  as respond to emerging issues. Developed by CMS’s central office  primarily for use by states and regions, AEM is one of many modules of a  broader data collection system called ASPEN. However, the ASPEN  modules—and other data systems related to enforcement such as the  financial management system for tracking CMP collections—are  fragmented and lack automated interfaces with each other. As a result,  enforcement officials must pull discrete bits of data from the various  systems and manually combine the data to develop a full enforcement  picture.
Furthermore, CMS has not defined a plan for using the AEM data to inform  the tracking and monitoring of enforcement through national enforcement  reports. While CMS is developing a few such reports, it has not developed  a concrete plan and timeline for producing a full set of reports that use the  AEM data to help assess the effectiveness of sanctions and its  enforcement policies. In addition, while the full complement of  enforcement data being recorded by the states and regional offices in AEM  is now being uploaded to CMS’s national system, CMS does not intend to  upload any historical data, which could greatly enhance enforcement  monitoring efforts. Finally, AEM has quality control weaknesses, such as  the lack of systematic quality control mechanisms to ensure accuracy of  data entry.
CMS officials told us they will continue to develop and implement  enhancements to AEM to expand its capabilities over the next several  years. However, until CMS develops a plan for integrating the fragmented  systems and for using AEM data—along with other data the agency  collects—efficient and effective tracking and monitoring of enforcement  will continue to be hampered. As a result, CMS will have difficulty  assessing the effectiveness of sanctions and its enforcement policies.
section_title: CMS Has Strengthened Oversight, although Competing Priorities Impede Certain Key Initiatives
paragraphs: CMS oversight of nursing home quality and state surveys has increased  significantly through several efforts, but CMS initiatives for nursing home  quality oversight continue to compete with each other, as well as with  other CMS programs, for staff and financial resources. Since OBRA ‘87  required CMS to annually conduct federal monitoring surveys for a sample  of nursing homes to test the adequacy of state surveys, CMS has developed  a number of initiatives to strengthen its oversight. These initiatives have  increased federal surveyors’ workload and the demand for resources.  Greater demand on limited resources has led to queues and delays in  certain key initiatives. In particular, the implementation of three key  initiatives—the new Quality Indicator Survey (QIS), investigative protocols  for quality-of-care problems, and an increase in the number of federal  quality-of-care comparative surveys—was delayed because they compete  for priority with other CMS projects.
subsections: section_title: Intensity of Federal Efforts Has Increased Significantly
paragraphs: CMS has used both federal monitoring surveys and annual state  performance reviews to increase its oversight of quality of care in nursing  homes. Through these two mechanisms it has focused its resources and  attention on (1) prompt investigation of complaints and allegations of  abuse, (2) more frequent and timely federal comparative surveys,   (3) stronger fire safety standards, and (4) upgrades to data systems.
subsections: section_title: Complaint Investigations
paragraphs: To ensure that complaints and allegations of abuse are investigated and  addressed in accordance with OBRA ‘87, CMS has issued guidance and  taken other steps. CMS guidance issued since 1999 has helped strengthen  state procedures for investigating complaints. For example, CMS  instructed states to investigate complaints alleging harm to a resident  within 10 workdays; previously states could establish their own time  frames for complaints at this level of severity. In addition, CMS guidance  to states in 2002 and 2004 clarified policies on reporting abuse, including  requiring notification of local law enforcement and Medicaid Fraud  Control Units, establishing time frames, and citing abuse on surveys.
CMS has taken three additional steps to improve its oversight of state  complaint investigations, including allegations of abuse. First, in its annual  state performance reviews implemented in 2002, it required that federal  surveyors review a sample of complaints in each state. These reviews  were done to determine whether states (1) properly categorized  complaints in terms of how quickly they should be investigated,   (2) investigated complaints within the time specified, and (3) properly  included the results of the investigations in CMS’s database. Second, in  January 2004, CMS implemented a new national automated complaint  tracking system, the ASPEN Complaints and Incidents Tracking System.  The lack of a national complaint reporting system had hindered CMS’s and  states’ ability to adequately track the status of complaint investigations  and CMS’s ability to maintain a full compliance history on each nursing  home. Third, in November 2004, CMS requested state survey agency  directors to self-assess their states’ compliance with federal requirements  for maintaining and operating nurse aide registries. CMS has not issued a  formal report of findings from these assessments, but in 2005 we reported  that CMS officials noted that resource constraints have impeded states’  compliance with certain federal requirements. As a part of this effort,  CMS is also conducting a Background Check Pilot Program. The pilot  program will test the effectiveness of state and national fingerprint-based  background checks on employees of long-term care facilities, including  nursing homes.
section_title: Federal Comparative Surveys
paragraphs: CMS has increased the number of federal comparative surveys for both  quality of care and fire safety and decreased the time between the end of  the state survey and the start of the federal comparative surveys. These  improvements allow CMS to better distinguish between serious problems  missed by state surveyors and changes in the home that occurred after the  state survey. The number of comparative quality-of-care surveys  nationwide per year increased from about 10 surveys a year during the   24-month period prior to October 1998 to about 160 per year for fiscal  years 2005 and 2006. The number of fire safety comparative surveys  increased as well from 40 in fiscal year 2003 to 536 in fiscal year 2006. In  addition, the average elapsed time between state and comparative quality- of-care surveys has decreased from 33 calendar days for the 64  comparative surveys we reviewed in 1999 to 26 days for all federal  comparative surveys completed through fiscal year 2006.
section_title: Fire Safety Standards
paragraphs: In addition to conducting more frequent federal comparative surveys for  fire safety, CMS has strengthened fire safety standards. In response to a  recommendation in our July 2004 report to strengthen fire safety  standards, CMS issued a final rule in September 2006 requiring  nonsprinklered nursing homes to install battery-powered smoke detectors  in resident rooms and common areas. In addition, CMS has issued a  proposed rule that would require all nursing homes to be equipped with  sprinkler systems and, after reviewing public comment, intends to publish  a final version of the rule and stipulate an effective date for all homes to  comply.
section_title: Upgrades to Data Systems
paragraphs: CMS has pursued important upgrades to data systems, expanded  dissemination of data and information, and addressed accuracy issues in  the MDS in addition to implementing complaint and enforcement systems.  One such upgrade increased state and federal surveyors’ access to OSCAR  data. CMS now uses OSCAR data to produce periodic reports to monitor  both state and federal survey performance. Some reports, such as survey  timeliness, are used during state performance reviews, while others are  intended to help identify problems or inconsistencies in state survey  activities and the need for intervention. In addition, CMS created a Web- accessible software program called Providing Data Quickly (PDQ) that  allows regional offices and state survey agencies easier access to standard  OSCAR reports, including one that identifies the homes that have  repeatedly harmed residents and meet the criteria for imposition of  immediate sanctions.
Since launching its Nursing Home Compare Web site in 1998, CMS has  expanded its dissemination of information to the public on individual  nursing homes participating in Medicare or Medicaid. In addition to data  on any deficiencies identified during standard surveys, the Web site now  includes data on the results of complaint investigations, information on  nursing home staffing levels, and quality measures, such as the percentage  of residents with pressure sores. On the basis of our recommendations,  CMS is now reporting fire safety deficiencies on the Web site, including  information on whether a home has automatic sprinklers to suppress a  fire, and may include information on impending sanctions in the future.  However, CMS continues to address ongoing problems with the accuracy  and reliability of some of the underlying data. For example, CMS has  evaluated the validity of quality measures and staffing information it  makes available on the Web, and it has removed or excluded questionable  data.
In addition to building the quality measures reported on Nursing Home  Compare, the MDS data are the basis for patient care plans, adjusting  Medicare nursing home payments as well as Medicaid payments in some  states, and assisting with quality oversight. Thus the accuracy of the MDS  has implications for the identification of quality problems and the level of  nursing home payments. OBRA ‘87 required nursing homes that participate  in the Medicare and Medicaid programs to perform periodic resident  assessments; these resident assessments are known as the MDS. In  February 2002, we assessed federal government efforts to ensure the  accuracy of the MDS data. We reported that on-site reviews of MDS data  that compared the MDS to supporting documentation were a very effective  method of assessing the accuracy of the data. However, CMS’s efforts to  ensure the accuracy of the underlying MDS data were too reliant on off- site reviews, which were limited to documentation reviews or data  analysis. To ensure the accuracy of the MDS, CMS signed a new contract  for on-site reviews in September 2005; these reviews are ongoing.
section_title: Competing Priorities Impede Certain Key CMS Initiatives
paragraphs: CMS initiatives for nursing home quality oversight continue to compete  with each other, as well as with other CMS programs, for staff and  financial resources. Greater nursing home oversight and growth in the  number of Medicare and Medicaid providers has created increased  demand for staff and financial resources. Greater demand on limited  resources has led to queues and delays in key initiatives. Three key  initiatives—the new Quality Indicator Survey (QIS), investigative protocols  for quality-of-care problems, and an increase in the number of federal  quality-of-care comparative surveys—were delayed because they compete  for priority with other CMS projects.
The implementation of the QIS, in process for over 8 years, continues to  encounter delays because of a lack of resources. The QIS is a two-stage,  data-driven, structured survey process intended to systematically target  potential problems at nursing homes by using an expanded sample and  structured interviews to help surveyors better assess the scope of any  identified deficiencies. CMS is currently concluding a five-state  demonstration of the QIS system. A preliminary evaluation by CMS  indicates that surveyors have spent less time in homes that are performing  well, deficiency citations were linked to more defensible documentation,  and serious deficiencies were more frequently cited in some  demonstration states. However, CMS officials recently reported that  resource constraints in fiscal year 2007 threaten the planned expansion of  this process beyond the five demonstration states. Although 13 states  applied to transition to QIS, resource limitations may prevent this  expansion. In addition, at least $2 million is needed over 2 years to develop  a production quality software package for the QIS.
Since hiring a contractor in 2001 to facilitate convening expert panels for  the development and review of new investigative protocols, CMS has  implemented eight sets of investigative protocols. In December 2005, we  reported that these investigative protocols provided surveyors with  detailed interpretive guidance and ensured greater rigor in on-site  investigations of specific quality-of-care areas, such as pressure sores,  incontinence, and medical director qualifications. However, the issuance  of additional protocols was slowed because of lengthy consultation with  experts and prolonged delays related to internal disagreement over the  structure of the process. Instead, it has returned to the traditional revision  process even though agency staff believes that the expert panel process  produced a high-quality product. Since issuing several protocols in 2006,  CMS has plans to issue two additional protocols.
Although CMS hired a contractor in 2003 to further increase the number of  federal quality-of-care comparative surveys, it stopped funding this  initiative in fiscal year 2006. The agency reallocated the funds to help state  survey agencies meet the increased workload resulting from growth in the  number of other Medicare providers.
section_title: Concluding Observations
paragraphs: About 20 years ago, significant attention from the Special Committee on  Aging, the Institute of Medicine, and others served as a catalyst to focus  national attention on nursing home quality issues, culminating in the  nursing home reform provisions of OBRA ‘87. Beginning in 1998, the  Committee again served as a catalyst to focus national attention on the  fact that the task was not complete; through a series of hearings, it held  the various stakeholders publicly accountable for the substandard care  reported in a small but significant share of nursing homes nationwide.  Since then, in response to many GAO recommendations and on its own  initiative, CMS has taken many important steps and invested resources to  respond in a timelier, more rigorous, and more consistent manner to  identified problems and improve its oversight process for the care of  vulnerable nursing home residents. This is admittedly no small  undertaking, given the large number and diversity of stakeholders and  caregivers involved at the federal, state, and provider levels. Nevertheless,  despite the passage of time and the level of investment and effort, the  work begun after OBRA ‘87 is still not complete. It is important to continue  to focus national attention on and ensure public accountability for homes  that harm residents. With these ongoing efforts, the momentum of earlier  initiatives can be sustained and perhaps even enhanced and the quality of  care for nursing home residents can be secured, as intended by Congress  when it passed this legislation.
Mr. Chairman, this concludes my prepared remarks. I would be pleased to  respond to any questions that you or other Members of the Committee  may have.
section_title: GAO Contact and Acknowledgments
paragraphs: For future contacts regarding this testimony, please contact Kathryn G.  Allen at (202) 512-7118 or at allenk@gao.gov. Contact points for our  Offices of Congressional Relations and Public Affairs may be found on the  last page of this testimony. Walter Ochinko, Assistant Director; Kaycee M.  Glavich; Leslie V. Gordon; K. Nicole Haeberle; Daniel Lee; and Elizabeth T.  Morrison made key contributions to this statement.
section_title: Appendix I: Prior GAO Recommendations, Related CMS Initiatives, and Implementation Status
paragraphs: Table 2 summarizes our recommendations from 11 reports on nursing  home quality and safety, issued from July 1998 through March 2007; CMS’s  actions to address weaknesses we identified; and the implementation  status of CMS’s initiatives as of April 2007. The recommendations are  grouped into four categories—surveys, complaints, enforcement, and  oversight. If a report contained recommendations related to more than one  category, the report appears more than once in the table. For each report,  the first two numbers identify the fiscal year in which the report was  issued. For example, HEHS-98-202 was released in 1998. The Related GAO  Products section at the end of this statement contains the full citation for  each report. Of our 42 recommendations, CMS has fully implemented 18,  implemented only parts of 7, is taking steps to implement 10, and declined  to implement 7.
section_title: Appendix II: Percentage of Nursing Homes Cited for Actual Harm or Immediate Jeopardy during Standard Surveys
paragraphs: In order to identify trends in the percentage of nursing homes cited with  actual harm or immediate jeopardy deficiencies, we analyzed data from  CMS’s OSCAR database for fiscal years 2000 through 2006 (see table 3).  Because surveys are conducted at least every 15 months (with a required  12-month statewide average), it is possible that a home was surveyed  twice in any time period. To avoid double counting of homes, we included  only homes’ most recent survey from each period.
section_title: Related GAO Products
paragraphs: Nursing Homes: Efforts to Strengthen Federal Enforcement Have Not  Deterred Some Homes from Repeatedly Harming Residents. GAO-07-241.  Washington, D.C.: March 26, 2007.
Nursing Homes: Despite Increased Oversight, Challenges Remain in  Ensuring High-Quality Care and Resident Safety. GAO-06-117.  Washington, D.C.: December 28, 2005.
Nursing Home Deaths: Arkansas Coroner Referrals Confirm Weaknesses  in State and Federal Oversight of Quality of Care. GAO-05-78.  Washington, D.C.: November 12, 2004.
Nursing Home Fire Safety: Recent Fires Highlight Weaknesses in  Federal Standards and Oversight. GAO-04-660. Washington D.C.:   July 16, 2004.
Nursing Home Quality: Prevalence of Serious Problems, While  Declining, Reinforces Importance of Enhanced Oversight. GAO-03-561.  Washington, D.C.: July 15, 2003.
Nursing Homes: Public Reporting of Quality Indicators Has Merit, but  National Implementation Is Premature. GAO-03-187. Washington, D.C.:  October 31, 2002.
Nursing Homes: Quality of Care More Related to Staffing than Spending.  GAO-02-431R. Washington, D.C.: June 13, 2002.
Nursing Homes: More Can Be Done to Protect Residents from Abuse.  GAO-02-312. Washington, D.C.: March 1, 2002.
Nursing Homes: Federal Efforts to Monitor Resident Assessment Data  Should Complement State Activities. GAO-02-279. Washington, D.C.:  February 15, 2002.
Nursing Homes: Sustained Efforts Are Essential to Realize Potential of  the Quality Initiatives. GAO/HEHS-00-197. Washington, D.C.:   September 28, 2000.
Nursing Home Care: Enhanced HCFA Oversight of State Programs  Would Better Ensure Quality. GAO/HEHS-00-6. Washington, D.C.:  November 4, 1999.
Nursing Home Oversight: Industry Examples Do Not Demonstrate That  Regulatory Actions Were Unreasonable. GAO/HEHS-99-154R. Washington,  D.C.: August 13, 1999.
Nursing Homes: Proposal to Enhance Oversight of Poorly Performing  Homes Has Merit. GAO/HEHS-99-157. Washington, D.C.: June 30, 1999.
Nursing Homes: Complaint Investigation Processes Often Inadequate to  Protect Residents. GAO/HEHS-99-80. Washington, D.C.: March 22, 1999.
Nursing Homes: Additional Steps Needed to Strengthen Enforcement of  Federal Quality Standards. GAO/HEHS-99-46. Washington, D.C.:   March 18, 1999.
California Nursing Homes: Care Problems Persist Despite Federal and  State Oversight. GAO/HEHS-98-202. Washington, D.C.: July 27, 1998.
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