Of Carrots and Sticks: CMS’ New and Improved Approach to Surveys

Skilled nursing facilities (SNF) that participate in the Medicare program are required to be “surveyed” annually and not more than every 15 months. Additionally, a complaint regarding resident care will trigger a complaint investigation. When deficiencies that present “immediate jeopardy” are determined during a survey, a follow-up “revisit” survey will occur. (A “deficiency” is a violation of a specific federal regulation found at 42 C.F.R. part 483 regarding Medicare’s Requirements for Participation for SNFs.)

Leslie Eber, MD, CMD, FPALTC, president of PALTmed

When there are deficiencies that either cause harm, have the potential for more than minimal harm or are “likely” to cause death or serious injury, the Centers for Medicare and Medicaid Services (CMS) is authorized by statute to impose one or more “sanctions” such as a civil money penalty (CMP), a denial of payment for new admissions (DPNA), temporary management, a directed in-service, or a directed plan of correction. In extreme cases, CMS may terminate a SNF from the Medicare program.

In addition to the sanctions noted above, a SNF that has serious deficiencies may end up being designated a Special Focus Facility. Further, when deficiencies regarding abuse or neglect are alleged, CMS will post an icon of an outstretched hand on its Nursing Home Care Compare website, which could have a devastating impact on a SNF from a public relations and marketing perspective.

While CMS does not hesitate to penalize poor performing SNFs–nor should it–with one or more of the sanctions noted above, it has not rewarded SNFs that demonstrate high quality performance–until now.

On July 16, 2026, CMS published a QSO Memoranda that introduced the concept of a Risk-Based Survey (RBS). This is a departure from the crushing weight of ever more draconian enforcement actions. Essentially, CMS will now reward “high performing” SNFs in two ways. First, those qualifying SNFs will still undergo their annual “recertification survey,” although it will have a reduced number of surveyors and the amount of time required to complete the survey will be decreased, making for a more efficient and expedited survey. Second, CMS will post a positive icon next to a facility’s name and profile on the Care Compare website. As long as a SNF continues to be eligible for a RBS, the icon will remain on the facility’s profile.

Clifton Porter, president and CEO of AHCA/NCAL

Various stakeholders have called for reform of the survey system for decades. Many have argued that the current survey system is too adversarial and punitive, focusing on the stick, rather than the carrot. Notably, CMS’ new approach is similar to a recommendation made by the Post-Acute and Long-Term Care Medical Association (PALTmed), formerly known as the American Medical Directors Association.

PALTmed is recognized for its advocacy of high-quality, patient-centered care and the development of evidence-based clinical practice guidelines, among its many other contributions to improving quality care. In 2020, PALTmed published recommendations from its Survey Reform Task Force. Among its recommendations was, “Instead of focusing on deficiencies only, surveyors should also account for superior performance, using a net score to determine overall quality.”

Leslie Eber, MD, CMD, FPALTC, president of PALTmed, welcomes the new approach. “This is a wonderful step forward to recognize the excellence in care that can happen in nursing homes,” she says. “Often, nursing homes have been vilified and sometimes without cause. It is useful to recognize that many residents have memory impairments and caring for residents struggling with dementia can be challenging on many levels.

“Caregivers in nursing homes are often doing the very best they can. Elevating and honoring the professional care that occurs in nursing homes not only allows the caregivers in our homes to feel a sense of pride and purpose but also helps to reframe our perceptions of nursing homes in the United States,” she adds. CMS’ new approach to surveys will focus not only on deficiencies, but on a SNF’s “superior performance,” as PALTmed suggested.

In addition to PALTmed, the American Health Care Association/National Center for Assisted Living (AHCA/NCAL), which represents over 15,000 long-term and post-acute care facilities, has long been a proponent of improving the survey system.

Dr. Mehmet Oz, CMS Administrator

“We applaud CMS’s nationwide expansion of the Nursing Home Risk-Based Survey, an approach AHCA has long supported to make the survey process more efficient and effective,” says Clifton Porter, president and CEO of AHCA/NCAL. “This initiative upholds accountability while further incentivizing quality improvement by recognizing high-performing facilities. We look forward to working with CMS and state survey agencies to support a successful implementation as well as explore additional ways to improve the oversight system so that it drives the results for residents we all hope to achieve.”

CMS’ recognition of excellence is welcome news for an industry that tries to do its best at providing quality care, often under challenging circumstances. “At CMS, we are continually looking for ways to recognize excellence for top performers and to encourage lower performers to improve,” says Dr. Mehmet Oz, CMS Administrator. CMS believes the new RBS will “encourage facilities to improve the quality of care they provide to qualify for the RBS and earn the corresponding icon on CMS’ Care Compare tool on Medicare.gov.”

The long-term care industry has responded very favorably to this new approach where CMS recognizes–and rewards–excellence by high-performing SNFs. CMS estimates that approximately 12 percent of all SNFs will meet the criteria for the RBS. Those criteria are “rigorous” according to CMS and are beyond the scope of this article.

Sometimes, carrots work better than sticks.

Learn more about this new approach and the specific criteria by accessing the CMS QSO Memoranda.

Alan C. Horowitz

Alan C. Horowitz, Esq., RN, is principal at Alan C. Horowitz & Associates and a member of the IASC Editorial Advisory Board. He focuses his legal practice on regulatory compliance and risk management for skilled nursing homes, hospices and home health agencies and manages cases where the Centers for Medicare and Medicaid Services (CMS) has imposed an enforcement action.

He is a former partner at Arnall Golden Gregory LLP, and also served as assistant regional counsel Office of the General Counsel, U.S. Department of Health and Human Services. As counsel to CMS, he was involved with hundreds of enforcement actions and successfully handled appeals before administrative law judges, the HHS Departmental Appeal Board and in federal court. He also has clinical healthcare experience as a registered respiratory therapist and registered nurse. He can be reached at AlanHorowitzLaw.com.