A new report on the Centers for Medicare and Medicaid Services’ (CMS) Special Focus Facility (SFF) program, released by Health & Human Services (HHS) Office of Inspector General (OIG) found that nearly two-thirds of nursing homes that graduated from the SFF program over a nine year period later showed a return to the types of quality problems for which they were initially referred to the program.

The  “CMS’s Special Focus Facility Program for Nursing Homes Has Not Yielded Lasting Improvements” report and accompanying data snapshot released on October 29 evaluated the performance of 495 SFF program nursing home participants between 2013 – 2022. In addition to finding many providers’ return to previous quality problems, the report further concluded that CMS relied too heavily on financial penalties such as civil money penalties instead of other non-financial penalties to bring about quality improvement. In addition, the agency did not consistently apply progressive enforcement according to program requirements.

OIG also found that nursing homes with higher staffing levels in the years following graduation from the SFF program were more likely to show sustained quality improvement and that in some cases, owners of nursing homes selected for the SFF program in a given state also owned nursing homes with quality issues or SFF program participation in other states, prompting OIG to suggest that staffing and ownership should play a larger role in SFF considerations.

Ultimately, OIG made three recommendations to CMS:

1. CMS should impose more non-financial enforcement remedies to encourage sustained compliance.
2. CMS should assess the extent to which it took enhanced enforcement actions for SFF graduates and the effectiveness of those actions, particularly for graduates that received a deficiency for staffing.
3. CMS should incorporate nursing home ownership information into the SFF program, such as in selecting SFFs and identifying patterns of poor performance.

LeadingAge supports OIG’s recommendations, particularly in regard to the use of non-financial enforcement remedies, an issue LeadingAge has raised with CMS in the past. While we appreciate this SFF program evaluation, we note that CMS has implemented several changes to the SFF program and to policies around nursing home ownership transparency since the time period studied. It would be useful to see an update to this report evaluating the effectiveness of these policies in consideration of any future policy changes.