CMS announces enhanced enforcement actions for nursing homes and publishes data on long-term care facilities with coronavirus (COVID-19) cases



June 05, 2020

Government Investigations & White Collar Defense Alert

Author(s): Brian K. French, Adam R. Tarosky, Hannah Bornstein, Tina Sciocchetti

Nursing homes are operating under intense regulatory scrutiny and face increased risks of government enforcement actions because of the virus’s disproportionate effect on residents. We discuss CMS’s recent guidance, which confirms the government’s intention to rely on punitive measures to address the ongoing struggles of care facilities.

On June 1, 2020, the Centers for Medicare & Medicaid Services (CMS) announced enhanced enforcement actions and remedies for nursing homes with deficient infection control practices, along with updated survey requirements and performance-based metrics for the allocation of Coronavirus Aid, Relief, and Economic Security (CARES) Act funding to states. Three days later, CMS published detailed information about coronavirus (COVID-19) outbreaks in specific long-term care facilities (LTCFs) throughout the country in a searchable, online database.

COVID-19 has ravaged the nation’s nursing homes. Residents of LTCFs are typically older, suffer from high levels of chronic illness, and live together in close quarters, all factors that place patients and caregivers at high-risk of contracting and transmitting a coronavirus. Nursing homes are operating under intense regulatory scrutiny and face increased risks of government enforcement actions because of the virus’s disproportionate effect on residents. The guidance CMS announced on June 1, detailed in its memorandum to state agencies that same day, confirms the government’s intention to rely on punitive measures to address the ongoing struggles of LTCFs to control COVID-19 infections in their facilities.

The publication of nursing home data

CMS published an interim final rule, effective May 8, 2020, requiring LTCFs to electronically report—on at least a weekly basis—confirmed and suspected COVID-19 cases to the Center for Disease Control and Prevention (CDC). On June 4, 2020, CMS posted the CDC-reported data on a publicly available website. According to this data, as of June 5, 2020, nursing homes have reported 95,515 confirmed cases of COVID-19, 58,288 suspected cases, and 31,782 deaths.

The data that CMS posted is broken down by provider name; address; number of beds, residents, and staff; number of confirmed and suspected COVID-19 cases among residents and staff; number of COVID-19 deaths among residents and staff; whether the facility has a shortage of staff; whether the facility has supplies of personal protective equipment (PPE) on hand; and other data points. CMS believes that this information will enable patients and families to assess the quality of the nursing homes in their service areas and reinforce the agency’s commitment to transparency.

Unfortunately, while transparency itself is a worthy goal and may assist patients and their families when choosing a nursing home, the data that CMS has published does not provide the full context surrounding COVID-19 infection rates at each facility. For example, the published information does not explain why certain facilities are experiencing staffing shortages or a lack of available PPE or testing capabilities, nor does it reflect whether coronavirus outbreaks occurred despite a facility’s good faith efforts and robust infection control program. Without more context, nursing homes that show high numbers of COVID-19 cases may be wrongfully perceived as having been negligent in their efforts to prevent and contain the virus and unfairly singled out for government investigations or in news reports.

Experience with CMS’s Open Payments database reveals that these risks are very real. Under the Open Payments program, CMS hosts an online, searchable database that identifies payments to specific physicians and teaching hospitals across the country from drug and device companies. Open Payments data has proved to be of limited practical value to patients and consumers but has served as an investigative resource for government enforcement agencies and the press. Indeed, especially in the early years of the Open Payments program, when CMS posted its physician payment data each year, news reports quickly followed in which the media used the published information to identify local physicians and hospitals that received seemingly large payments from industry, often suggesting impropriety with no context for the payments or any discussion about the legitimate purposes of the arrangements.

Since government regulators may use the COVID-19 data to target facilities for investigation, LTCFs should review the online information to assess how they compare with their peer facilities. Although all nursing homes should document their efforts to contain and mitigate the spread of infectious diseases within their facilities, it is particularly important for LTCFs to do so if they appear to be outliers within the database. Nursing facilities should keep contemporaneous documentation proving that they have continued to monitor and implement the relevant COVID-19 guidance from CMS, CDC, and state and local health officials; that they have established and follow a robust infection prevention and control program; and that they have made good-faith efforts to address any shortages of equipment, staff, or testing capabilities that may have impaired their efforts to prevent and contain the spread of the coronavirus.

Enhanced enforcement for infection control deficiencies

CMS has an established process for identifying the scope and severity of nursing home deficiencies in meeting federal participation requirements, reflected in the following grid:[1]

SEVERITY

SCOPE

Isolated

Pattern

Widespread

Immediate jeopardy[2] to resident health or safety

J

K

L

Actual harm that is not immediately jeopardy

G

H

I

No actual harm with potential for more than minimal harm but not immediate jeopardy

D

E

F

No actual harm with potential for minimal harm

A

B

C

 

According to CMS’s June 1 guidance, because of the increased threat to resident health and safety posed by even low-level infection control citations, the agency is expanding enforcement “to improve accountability and sustained compliance with” crucial infection control. Along with imposing new civil monetary penalties (CMPs) for noncompliance, CMS is also requiring additional measures, such as directed plans of correction,[3] “to facilitate lasting systemic changes within facilities to drive sustained compliance.”

Under CMS’s latest guidance, infection control deficiencies at Levels D to L of the scope and severity grid will lead to the following enforcement remedies:

COVID-19 ENFORCEMENT REMEDIES

Noncompliance for infection control deficiencies when none have been cited in the last year or in the last standard survey:

Remedies if nursing home cited for noncompliance that is not widespread (Level D and E):

  • Direct plan of correction

Remedies if nursing home cited for noncompliance that is widespread (Level F):

  • Direct plan of correction
  • Discretionary denial of payment for new admissions, with 45 days to show compliance

Noncompliance for infection control deficiencies cited once in the last year or in the last standard survey:

Remedies if nursing home cited for noncompliance that is not widespread (Levels D and E):

  •  Directed plan of correction
  • Discretionary denial of payment for new admissions, with 45 days to show compliance
  •  $5,000 per instance CMP

Remedies if nursing home cited for noncompliance that is widespread (Level F):

  •  Directed plan of correction
  • Discretionary denial of payment for new admissions, with 45 days to show compliance
  • $10,000 per instance CMP

Noncompliance for infection control deficiencies cited twice or more in the last two years or twice since the second-to-last standard survey:

Remedies for nursing home cited for noncompliance that is not widespread (Level D and E):

  •  Directed plan of correction
  • Discretionary denial of payment for new admissions, with 30 days to show compliance
  • $15,000 per instance CMP (or per day CMP as long as the total amount exceeds $15,000)

Remedies for nursing home cited for noncompliance that is widespread (Level F):

  •  Directed plan of correction
  • Discretionary denial of payment for new admissions, with 30 days to show compliance
  • $20,000 per instance CMP (or per day CMP as long as the total amount exceeds $20,000)

Remedies for nursing home cited for noncompliance for infection control deficiencies at Levels G, H, or I, regardless of past history:

  • Directed plan of correction
  • Discretionary denial of payment for new admissions, with 30 days to show compliance
  • Enforcement imposed by CMS location per current policy, but CMP imposed at the highest amount option within the appropriate (non-immediate jeopardy) range in the CMP analytic tool

Remedies for nursing home cited for noncompliance for infection control deficiencies at the Immediate Jeopardy level (Levels J, K, L), regardless of past history:

  • Mandatory termination or imposition of a temporary manager to oversee correction of the deficiencies and assure the health and safety of the facility’s residents while corrections are being made
  • Directed plan of correction
  • Discretionary denial of payment for new admissions, with 15 days to show compliance
  • Enforcement imposed by CMS location per current policy, but CMP imposed at highest amount option within the appropriate (immediate jeopardy) range in the CMP analytic tool

 

Focused infection control surveys and CARES Act funding

In March 2020, CMS authorized state survey agencies to focus solely on immediate jeopardy complaints, targeted infection control surveys, and certain initial certification surveys. As part of this triage, CMS issued a COVID-19 Focused Infection Control survey tool to assess whether LTCFs are implementing proper infection prevention and control practices to prevent the development and transmission of COVID-19 and other communicable diseases and infections.

Based on data that CMS published with its June 1 guidance, out of 15,412 nursing homes nationwide, states have conducted focused infection control surveys at 8,332 facilities, an average of roughly 54%. CMS notes that there is a wide variation in the number of focused infection control surveys conducted by the states, ranging from 11% to 100% of facilities in each state. Although this variation may be attributable to many factors, including the number of nursing homes in each state, the rate of statewide COVID-19 infections, and the availability of testing and protective equipment, CMS contends that “further direction” is needed to prioritize the completion of focused infection control surveys at LTCFs.

To that end, CMS announced that states that fail to complete 100% of their COVID-19 Focused Infection Control surveys by July 31, 2020, will have to submit a corrective action plan to CMS outlining their strategy for completing the surveys within 30 days. If, after the 30-day period, a state still has not surveyed 100% of its nursing homes, the state’s fiscal year 2021 CARES Act supplemental funding for survey work may be reduced by 10%. Subsequent 30-day extensions could lead to additional 5% reductions. These funds would then be redistributed to states that completed all of their focused infection control surveys on time.

Some states may be struggling to complete focused infection control surveys because of the high number of nursing homes and COVID-19 infections within their borders. According to CMS data, for example, the percentage of nursing homes surveyed in Massachusetts and New York is about 23% and 37%, respectively. While it is unclear whether these low-percentage states will have the capacity to meet the July 31 deadline, it is reasonable to assume that they will make every effort to do so and that nursing homes within those states will experience an increase in infection control survey activity.

Additional COVID-19 survey activities

Besides completing the COVID-19 Focused Infection Control surveys, CMS is requiring states to implement the following COVID-19 survey activities:

  • By July 1, 2020, perform on-site surveys of nursing homes with previous coronavirus outbreaks, defined as
  • Cumulative confirmed cases/bed capacity at 10% or greater; or
  • Cumulative confirmed plus suspected cases/bed capacity at 20% or greater; or
  • Ten or more deaths reported due to COVID-19.
  • Perform on-site surveys within three to five days of identification of any nursing home with three or more new COVID-19 suspected and confirmed cases since the facility’s last report to CDC, or one confirmed resident case in a facility that was previously COVID-19-free.
  • Starting in fiscal year 2021, perform annual focused infection control surveys of 20% of nursing homes based on state discretion or additional data that identifies facility and community risks.

States that fail to perform these survey activities timely and completely could forfeit up to 5% of their CARES Act allocation annually.

Additional COVID-19 activities

The June 1 guidance notes that states may use CARES Act funding for state-specific interventions, “such as Strike Teams, enhanced surveillance, or monitoring of nursing homes.” State priorities may also be informed by the recommendations of the Coronavirus Commission for Safety and Quality in Nursing Homes, which CMS appears to anticipate receiving in August 2020.

Expanded survey activities

Once a state has entered Phase 3 of the federal nursing home reopening guidance, or earlier, at the state’s discretion, states may expand beyond the current survey prioritization (immediate jeopardy, focused infection control, and initial certification surveys) to perform:

  • Complaint investigations that are triaged as non-immediate jeopardy—High Priority[4]
  • Revisit surveys of any facility with removed immediate jeopardy (but still out of compliance)
  • Special focus facility and special focus facility candidate recertification surveys
  • Nursing home and immediate care facility for individuals with intellectual disability (ICF/IID) recertification surveys that are greater than 15 months.

According to CMS, when determining the order in which to schedule more routine surveys, states should prioritize providers based on those with a history of noncompliance, or allegations of noncompliance, with the below items:

  • Abuse or neglect
  • Infection control
  • Violations of transfer or discharge requirements
  • Insufficient staffing or competency
  • Other quality of care issues (e.g., falls, pressure ulcers, etc.)

Accrediting organizations may resume normal survey activities based on state reopening criteria. Any variations from the approved reaccreditation survey process must receive CMS approval before implementation.

HHS-OIG audits

Finally, the Department of Health and Human Services, Office of Inspector General (HHS-OIG), CMS’s law enforcement partner, recently announced in its work plan that it also intends to audit nursing home infection prevention and control programs. HHS-OIG’s Office of Audit Services will investigate whether selected nursing homes “have programs for infection prevention and control and emergency preparedness in accordance with [f]ederal requirements.”

In the announcement, HHS-OIG noted that as of February 2020 (i.e., just before the explosion of COVID-19 cases in the United States), more than 6,600 nursing homes had been cited for infection prevention and control program deficiencies and that effective internal controls must be in place to reduce the likelihood of contracting and spreading COVID-19.

Final thoughts

CMS, HHS-OIG, and other federal, state, and local regulators and enforcement agencies will be auditing and investigating nursing homes and other long-term care providers in the coming months, particularly those that may appear to have experienced disproportionately high rates of COVID-19 infections or deaths. LTCFs should continue to closely monitor guidance from CMS, CDC, and others, and avail themselves of the tools those agencies have issued for addressing critical risk areas and showing that the facility responded to the crisis with appropriate diligence and planning. Counsel is available to assist LTCFs in preparing for audits and responding to other governmental inquiries or investigations.


  1. To select the appropriate enforcement remedies, the state survey agency must assess the scope and severity levels of the deficiencies. The severity level reflects the impact of the deficiency and is categorized by the four levels of harm identified in the grid. The scope level of a deficiency reflects how many residents were affected by the deficiency. See State Operations Manual, Ch. 7, § 7400.3.1.
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  2. Immediate jeopardy means a situation in which the provider’s noncompliance with one or more requirements of participation has caused, or is likely to cause, serious injury, harm, impairment, or death to a resident. 42 C.F.R. § 488.301.
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  3. Directed plans of correction include directed actions from the survey agency that the facility must take to address the noncompliance and its root causes. See State Operations Manual, Ch. 7, § 7304.1.
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  4. Complaints are assigned as “high” priority if the alleged noncompliance with one or more requirements may have caused harm that negatively impacts the individual’s mental, physical, and/or psychosocial status and are of such consequence to the person’s well-being that a rapid response by the state agency is indicated. Usually, specific rather than general information (such as descriptive identifiers, individual names, date/time/location of occurrence, description of harm) factors into the assignment of this level of priority. See State Operations Manual, Ch. 5, § 5075.2.
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