While the Centers for Medicare & Medicaid Services has published a laundry list of possible enforcement actions for nursing homes that fail to meet new staffing requirements, providers can only wonder how the agency might actually penalize non-compliance.
In the final rule published May 10 in the Federal Register, CMS said remedies available to surveyors citing facilities that are “not in substantial compliance” could include termination of a Medicare provider agreement, denial of payment for new admissions and civil money penalties.
Lesser requirements would impose directed training, additional state monitoring, a plan of correction, transfer of residents or enlistment of a temporary manager at facilities that cannot meet specific facets of the rule.
Exactly how or when any those penalties would be meted out, however, won’t be detailed until closer to the implementation dates for the different components of the rule, CMS has said.
“We will publish more details on how compliance will be assessed … in advance of each implementation date for the different components of the rule,” the agency said in its Federal Register entry. “We envision using a combination of PBJ data and onsite surveys to assess compliance with various aspects of the requirements. We note that since the requirements specify specific staffing minimum thresholds, the determination of compliance with these thresholds will be objective, and not subjective.”
The mandate requires facilities to provide 3.48 hours of daily direct care per patient, with 0.55 of that delivered by a registered nurse and 2.45 delivered by certified nurse aides. The remaining time can be provided by those nurses or licensed practical nurses.
The rule also requires all facilities to have an updated facility assessment by this August. By May 2026, most facilities must also meet the 3.48-hourly standard and a requirement for 24/7 RN staffing. The following year brings the 0.55 hourly requirement for RN direct care and 2.45 hourly requirement for CNAs.
Rural providers have two additional years to comply with most provisions but would presumably be subject to the same penalty structure, if they do not qualify for an exemption.
Providers see unforgiving survey environment
Waiting for each of those deadlines to get more clarity on how frequently CMPs might be issued is a nagging worry for some providers, especially given the rule’s estimated upfront hiring costs of $6.5 billion annually.
“We’re terribly concerned,” Steve LaForte, chief legal officer and executive vice president of Corporate Affairs for Cascadia Healthcare, told McKnight’s Long-Term Care News Monday. “There’s so much about this rule that becomes existential for the operator.”
Annual CMP data is hard to calculate nationally and has been impacted over the last several years by unusual survey activity related to COVID.
But there’s little question the survey environment has become more punitive, said LaForte. He predicts staffing penalties alone could surpass $3.5 billion annually, bringing the actual cost of the rule to more than $10 billion a year for providers. While companies like his may be able to spread those costs out over their chain, LaForte said the larger threat is to the average provider operating three facilities on a razor-thin margin.
Because exemptions are only provided after a survey is completed, LaForte also sees another reason to be concerned. Even a one-time penalty cited at a high enough scope and severity could push providers across the CMP threshold that prevents them from being allowed to train their own CNAs — creating a vicious cycle.
“It seems like the way this is designed,” he said. “I don’t expect any part of it to be forgiving.”
Still, some providers are holding out hope that CMS may take a more collaborative approach, especially if ongoing staffing challenges persist.
“Until the rules are established, it’s impossible to assess their total impact,” said PruittHealth Chairman and CEO Neil L. Pruitt, Jr. “However, the purpose of civil monetary penalties (remedies) is not to punish a facility but to achieve compliance. Our goal is that CMS would work cooperatively with the centers who are unable to find appropriate staff to help them build a workforce to address the staffing requirements.”
New approach aligns with new rule
Another provider told McKnight’s that with “so little known” around enforcement and penalties — and raging debate about whether the mandate will be allowed to go into effect — that “most companies” haven’t given the topic much thought yet.
But providers may have reason to be concerned.
CMS earlier this spring proposed a new approach to broadened CMPs as part of its 2025 payment rule for nursing homes. Under that change, surveyors could impose either per-day or per-instance but not both during the same survey.
“CMS is proposing to expand its ability to impose financial penalties to drive sustained correction of health and safety deficiencies,” an agency notice said. “These revisions will allow CMS to expand the mix and number of penalties in response to situations that put residents’ health and safety at risk.”
CMS pointed to that change in response to commenters on the staffing mandate who wanted the agency to take a hard line on compliance.
While some letter writers told CMS enforcement actions are often too severe, the agency noted that others asked for “detailed guidelines” on when a surveyor should assess appropriate penalties at the harm or Immediate Jeopardy level whenever there is serious harm, injury, impairment or death of a resident.
“Many commenters expressed concerns related to the importance of identifying noncompliance and taking appropriate enforcement actions so that residents’ health and safety are protected,” CMS said. “We appreciate and will consider the comments as we move forward and recognize that rigorous data-driven enforcement will be critical to the successful implementation of this rule.”
CMS noted that it generally remains up to the state survey agency to select the appropriate enforcement remedies, based on the deficiency’s impact on resident health and safety and how many residents were affected by the deficiency.
