‘Temporary management’ imposed on inadequate facilities

A government watchdog agency is recommending that federal officials take steps to use existing authority to impose temporary management on nursing homes found to be placing residents in “immediate jeopardy,” putting them at risk of death or serious injury.

At a glance…

The Government Accountability Office is recommending that federal officials take steps to use existing authority to impose temporary management on nursing homes found to be placing residents in “immediate jeopardy,” putting them at risk of death or serious injury.

“The nation’s 1.4 million nursing home residents are a highly vulnerable population of elderly and disabled individuals for whom remaining at home is no longer feasible,” a statement from the Government Accountability Office (GAO) said. “The federal government plays a key role in ensuring that nursing home residents receive appropriate care by setting quality requirements that nursing homes must meet to participate in the Medicare and Medicaid programs and by contracting with states to conduct routine inspections … and complaint investigations.”

Sanctions authorized

The GAO pointed out that to encourage compliance with quality requirements, Congress has authorized enforcement actions, or sanctions, such as civil money penalties or termination from participating in Medicare and Medicaid. Another sanction, which typically is imposed at the state’s request, is temporarily replacing a home’s management with federally appointed temporary managers.

In a November 20, 2009, report to Congress, the GAO said that power, available to the Centers for Medicare & Medicaid Services (CMS), was used in 14 nursing homes across 10 states from 2003 through 2008.

At the conclusion of a lengthy and detailed investigation, the GAO recommended that CMS:

  • Create and maintain lists of qualified temporary managers capable of replacing the management of nursing homes found to be jeopardizing patients.

  • Develop information that identifies best practices, such as when and how to use the temporary management sanction.

  • Develop guidance for states to help ensure the longer-term compliance of homes that have undergone temporary management.

In its response, CMS said it would “seek state best practices, evaluate, and develop additional information to assist states and regional offices in using temporary management.” However, the agency said the time line would need to be determined “based on current and anticipated workloads.”

CMS also said it does not plan to develop or maintain a list of qualified temporary managers, citing the need for constant updating a list of “at-the-ready” potential temporary managers matched to particular geographical areas with particular skill sets that may be needed for a very diverse array of nursing facilities. It pointed out that such a list would be used infrequently and that staff resources might better be devoted to nursing home oversight and enforcement. However, the GAO responded by saying that the full potential of the temporary management sanction will not be realized without such lists.

CMS said it is unclear from the GAO analysis whether the use of temporary management is superior or inferior to other forms of enforcement, such as denial of payment for new admissions or civil monetary penalties. That determination, the agency said, needs to be made on a case-by-case basis.

Third recommendation

With respect to the GAO’s third recommendation, CMS said it would explore alternatives considering the full array of potential remedies together, rather than temporary management per se.

“As the GAO report indicates,” CMS wrote, “the choice of using a temporary management sanction in lieu of other remedies is typically occasioned by very specific circumstances in the nursing home.”

In some cases, CMS pointed out, temporary management is imposed to help effect an orderly transition of residents to alternative arrangements prior to a nursing home’s closure. In other instances, the decision to use temporary management depends on the facility’s finances, or an assessment of the capabilities of the current management team, or other factors.

“While the unique circumstances on the ground are likely to be more important than any general guidance from CMS, we will explore this topic with a state-federal work group,” the agency said.

According to the GAO, federal temporary management was successful in achieving its intended objective in the short term in 13 of the 14 homes in which it was imposed. In 11 of those homes, the sanction was used with the goal of correcting deficiencies that caused the home to be noncompliant with federal quality requirements. In 10 of these homes, that objective was met, and the remaining home was terminated from Medicare and Medicaid and was closed.

In two of the 14 homes, GAO said, the sanction was used to oversee the orderly closure of and relocation of residents from homes that were successfully closed. In the remaining home, the objective changed from bringing the home into substantial compliance to overseeing orderly closure when the temporary manager determined that the home was not financially viable and could not pay for changes to return it to compliance.

Successful temps

Based on responses from officials in the 10 states and seven CMS regional offices that used federal temporary management from 2003 through 2008, several factors that influenced the successful use of the sanction of imposing a temporary manager were identified:

  • Coordination and communication. In part because the sanction’s use required a considerable investment of time and resources, coordination and frequent communication between the temporary manager, state, and CMS regional office were important to the sanction’s success.

  • Cooperation of nursing home owner. Lack of cooperation from the owner in providing the temporary manager complete control of expenditures, personnel, and policies at the home impeded the success of the temporary manager.

  • Available funding for temporary management. In all but two homes, the home funded temporary management. In one home, funding was provided by the state and in the other, the home’s creditor provided the resources to pay for the temporary manager, whose monthly compensation ranged from less than $15,000 to $60,000 for the six homes where that information was provided.

The GAO said that although most homes corrected deficiencies in the short term, some homes continued to have long-term compliance problems. Nine of the 10 homes that returned to substantial compliance while under temporary management were still participating in the Medicare and Medicaid programs as of August 2009. But state and CMS regional officials informed GAO that five homes continued to have problems, and in two, the state used its own temporary management sanction within two years after the conclusion of federal temporary management.

When a nursing home is found to be placing residents in immediate jeopardy, CMS requires that such risks be removed within 23 calendar days following the citation, with or without the assistance of temporary management. Otherwise, CMS will terminate the home from Medicare and Medicaid.

The GAO said that this short time frame can be an obstacle to the use of federal temporary management, but acknowledged that extending it could result in nursing homes taking more time to resolve deficiencies and place nursing home residents at risk for longer periods of time.

It may be easier to address other obstacles to using federal temporary management that were addressed in its report, the GOA said, such as lack of qualified temporary managers and insufficient information illustrating best practices-obstacles that were addressed in the agency’s recommendations.

Bob Gatty has covered governmental developments of the trade and business press for more than 30 years. He is founder and president of G-Net Strategic Communications, Sykesville, Maryland.

To send your comments to the editor, please e-mail mhrehocik@iadvanceseniorcare.com.

Long-Term Living 2010 March;59(3):16-19

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