CMS Nursing Home Ratings as a Loan Criteria?

The Centers for Medicare & Medicaid Services (CMS) created the Five-Star Quality Rating System in order to help consumers, families, and caregivers compare nursing homes easily and help identify areas they may have questions about. The site rates each nursing home on a scale of 1 to 5; nursing homes with 5 star ratings are considered to be above average quality and homes with a 1 star rating is considered to have lower than average quality.  In order to obtain a high rating from CMS it is important to have adequate measures in place in order to that focus on prevention and early detection for wound/skin care, falls, and urinary incontinence. It is also important to have measures in place that focus on weight loss, dehydration, infection, and dementia care.

A bill proposed in October 2015 called The Nursing Home Accountability Act set forth guidelines that would make a nursing home facility with two or less stars ineligible for a future mortgage/loan.  This method is far more stringent than the  current Housing and Urban Development (HUD) standards.  HUD is a major lender for nursing home facilities.  Although this legislation is not likely to pass, it provides a glance into possible future legislation surrounding this topic.

In October 2015, CMS announced their Bundled Payment for Care Improvement (BCPI) program that would set a single spending target for all healthcare services that apply during a clinical episode of care over a specified time period. CMS released their final rule for their new Comprehensive Care for Joint Replacement (CJR) initiative in November, a mandatory bundled payment program for total hip/knee replacement in 67 metropolitan areas. As a result of bundled payment programs, hospitals, managed care and accountable care organizations are now looking to CMS’s Five-Star rating to select candidates for their networks. If facilities are not rated by CMS well, they risk missing out on revenue. This would place far greater significant on the Five-Star system.  Whether it is fair to tie a nursing home’s funding to the CMS rating is a valid question.  How reliable is the rating system?  Does it accurately reflect the care or lack thereof at the facility?

Appropriate care should always be the goal, and it seems like a noble goal to provide funding only to the facilities providing good care.  The question then becomes is it fair to have CMS be the judge and jury regarding which facilities meet the standard.  Do we want the goal of nursing home owners to be the provision of good care or the receipt of a rating some might view as unfair or arbitrary?   Regardless of your position on the proposed legislation, for Administrators/owners at nursing facilities would be to learn how the Five-Star system scores sites and gain a deep understanding of how ratings are calculated.

 If you or a loved one has been a victim of nursing home abuse, please do not hesitate to contact the experienced nursing home abuse attorneys at the Law Offices of Thomas L. Gallivan, PLLC.

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