The Department of Health and Human Services (HHS) has issued a new rule proposal that would require nursing homes to disclose more information on their ownership and management than what is currently required.
Nursing homes that are enrolled in Medicare and Medicaid are already required to report certain ownership and management data, but other information, such as those who provide cash management services, are not required to be disclosed. This new rule would push for more information to be divulged so that customers have a clearer sense of who is owning, managing and operating nursing homes.
The rule proposal also includes definitions of private equity and real estate investment trust to better determine whether nursing homes are owned by private equity investors or real estate investment trusts.
“President Biden has made clear: improving our nation’s nursing homes is an urgent priority, and this Administration is not afraid to take bold action to tackle this head-on,” HHS Secretary Xavier Becerra said in a statement.
Last month, the Government Accountability Office (GAO) released a report in which it found that nursing home ownership information is not structured in a way that allows consumers to know if different nursing homes share the same owners.
The Centers for Medicare & Medicaid Services (CMS) collects relevant information regarding nursing home ownership including profit status, names of individual and organizational owners, and chain ownership. The agency makes this information available on the online tool Care Compare.
CMS performs oversight for more than 15,000 nursing homes in the U.S. that participate in Medicare and Medicaid programs.
GAO recommended that CMS “fully align nursing home ownership information” on Care Compare with “characteristics of effective transparency tools.” These characteristics include organizing ownership information so customers can see quality ratings for homes under the same ownership and the use of plain language for key terms.
According to HHS, the proposed rule would include the implementation of part of the Affordable Care Act which would require nursing homes enrolled in Medicare and Medicaid to provide information on “individuals or entities that provide administrative services or clinical consulting.”
Bharat Ramamurti, deputy director of the White House National Economic Council, said in a press briefing that this rule was needed as many people are often unaware of who is being hired to provide for their family members.
In discussing the needs for this rule, the department cited studies which indicated nursing homes acquired by private equity were more likely to have preventable emergency department visits hospitalizations in comparison to nursing homes not associated with private equity.
“What is absolutely true is that we see more risks, that we see more harm when nursing homes change ownership. They can change owners to companies that don’t have experience — that don’t have the knowledge, the staff, the experience to ensure high quality care,” Jonathan Blum, CMS’s principal deputy administrator, said on Monday.