March 26, 2019

CMS Presents Skilled Nursing Regulatory Update

BY LeadingAge

In a memo on March 5, CMS stated that in-depth analysis to assess the impact of the new survey process introduced with Phase 2 of the Requirements of Participation on the health inspection domain of the Five Star Quality Rating System was complete and results concluded that the number of deficiencies cited under the two processes remained consistent, thus leading to the famous “unfreeze” of the health inspection star rating. CMS’s Bonnie Reed provided more details on the survey analysis. The chart below shows a comparison between the average number of citations under the new survey process compared to the processes in place prior (including both the QIS survey and the paper-based survey).


New Process

(after Phase 2)

Old Process

(prior to Phase 2)

Citations per survey



Deficiency-free surveys



Immediate Jeopardy (IJ) citations



Substandard Care citations



Scope / Severity – D



Scope / Severity – G



Additionally, Ms. Reed reported on the top 10 most-cited F-tags under the current survey process and the deficient practice(s) commonly leading to these citations, as below.


Deficient Practice Area

F880 Infection Control

Hand hygiene

F812 Food Procurement

Food temperatures at the time of serving, food labeling and storage

F656 Develop Care Plan

Failure to develop the comprehensive care plan

F689 Accidents

Falls, lack of supervision

F761 Drug Storage

Improper storage

F684 Quality of Care

Skin condition, medication side-effects, edema, change in condition, hospitalization, death

F657 Care Planning

Failure to revise the comprehensive care plan

F758 Unnecessary Psychotropic

Lack of documentation around PRN medications and Gradual Dose Reductions (GDR)

F641 Accurate Assessment

Skin assessments, nursing assessments

F550 Resident Rights

Dignity during the Dining Process, failure to act upon concerns of the Resident Council, information obtained during resident interview

Regarding the implementation of Phase 3, CMS’s Evan Shulman stated that, as in Phase 2, draft guidance and training would be released prior to the implementation date. He stated these resources were “coming soon” but was unable to provide a more detailed timeline. Mr. Shulman reviewed the upcoming changes to the Five Star Quality Rating System on Nursing Home Compare effective April 24, 2019 and provided rationale for some of the changes we will see. Regarding changes to the staffing rating, particularly those related to registered nurse (RN) staffing, CMS cites a “very strong relationship” between RN staffing and hospitalizations and RN staffing and other quality measures. Mr. Shulman further qualified that CMS research indicates a “clear quality difference” between the care provided by registered nurses and care provided by licensed nurses. When questioned about short-stay vs. long-stay measures, Mr. Shulman referenced the recently updated Quality Measure User Manual, which describes how quality measures are calculated and includes information on exemptions, such as the exemption of hospice patients from certain quality measures.

Survey processes and enforcement remedies generated significant discussion, with many providers describing relationships focused on punitive measures rather than a constructive, educational process in which the focus is on working together to improve care. Mr. Shulman stated that while CMS is working to resolve inconsistencies in citations and the issuance of fines and penalties, the survey functions to identify areas of noncompliance, whether this represents a pattern of noncompliance or not, and providers should be working with the Quality Improvement Organizations (QIOs) for constructive support. Mr. Shulman additionally recommended the use of webinars and other educational resources and stated that CMS is “very open” to developing these resources with providers. Mr. Shulman also reviewed changes to guidance for citing immediate jeopardy and the end of the moratorium on Phase 2 enforcements.

CMS’s John Kane provided a brief overview of the Patient-Driven Payment Model (PDPM), coming October 1, 2019, with a comparison of what will change and will not change between the new model and the old RUG-IV model. Mr. Kane cautioned that unless a clinical change occurs, a given resident’s care should not change with the implementation of PDPM and certain changes, such as a change in therapy intensity, duration, or delivery (e.g. group therapy), increased utilization of mechanically altered diets or significant changes to comorbidity coding will raise red flags. And while the overall assessment burden is anticipated to be lower as a result of drastically reduced numbers of required assessments, documentation will be more important than ever as PDPM shifts focus to a broader view of the individual resident’s needs. Also regarding program integrity, Mr. Kane discussed the new “interrupted stay” policy by which an individual’s variable per diem will not change if he or she is out of the facility for fewer than three consecutive days during a Part A-covered stay.

Mr. Kane also briefly highlighted the relationship between PDPM and Medicaid payment. As many states currently utilize RUGS-III or RUGS-IV for case-mix to calculate Medicaid payment, CMS has created the Optional State Assessment (OSA) to replace the PPS assessments that will be retired with the implementation of PDPM. This assessment may be required by states in order for nursing facilities to report changes to patient status for Medicaid stays. Mr. Kane urged providers to check with states regarding both the requirement of the OSA as well as the Upper Payment Limit (UPL) calculation to understand changes to Medicaid payments. Mr. Kane notes that the OSA is intended to be a temporary measure as states work to implement new Medicaid payment systems.

Lastly, if we can draw any conclusions from CMS-initiated discussions during the Leadership Summit, it would be to say this: it seems likely that CMS will begin focusing on substance abuse and behavioral health in the near future. Long-term care is evolving to meet the changing needs of those we serve and LeadingAge will continue to support members in this journey by providing educational resources and advocating for transparency in policy processes.