Posts Tagged ‘Nursing Homes’

Maryland Medicaid Agency Settles Multi-Million Dollar Lawsuit

MARCH 22, 2010  VOLUME 17, NUMBER 10

This week’s Elder Law Issues was written by our friend and Maryland colleague Ron M. Landsman. He describes the resolution of a class lawsuit he initiated in Maryland, challenging that state’s practice of setting Medicaid patients’ co-payment amount too high to allow them to pay nursing home bills incurred while they were waiting for Medicaid eligibility.

Preliminary approval of settlement of a class action suit in Maryland implements protection for nursing home residents who mess up their Medicaid eligibility and run out of money to pay for their care before they actually qualify for Medicaid benefits.

This is a common problem. The nursing home resident who is spending down misunderstands the rules or is careless, and finds himself with too much to qualify for Medicaid but not enough to pay the current nursing home bill.

The way Maryland was calculating residents’ co-payments, he would not have money to pay the old bill. Federal law requires – and the settlement implements – co-payment calculations that allow the resident to pay the old bill.

The resident is relieved of the risk of discharge for non-payment, and the nursing home gets paid for providing services. Legal Aid Bureau lawyers said they were using the new rules, which have been partly in effect while the suit was pending, to protect their clients from involuntary discharge because it gave them a way to pay the old bills once on Medicaid.

The Maryland class action, Eunice Smith, et al. v. John Colmers, et al., is believed to be the largest settlement ever paid by the Maryland Medicaid agency – up to $16 million in 2010-2012 to nursing homes that were underpaid because of the co-payment miscalculation. The nursing homes will then apply the previous resident co-payments to the old nursing home bills. If there is a shortfall and not enough to pay the old bills, the nursing homes receiving payment will have to forgive those old debts. That may amount to up to $64 million in claims against residents forgiven.

The settlement also requires the Maryland Medicaid agency to make comprehensive changes in the way it calculates co-payments so that it does it correctly in the future.

Cy Smith and Bill Meyer of Zuckerman Spaeder LLP in Baltimore, and Ron Landsman of Rockville, represented the plaintiff class. Landsman obtained the federal agency ruling that Maryland’s old rules for co-payments violated federal law, which then triggered the private lawsuit. Smith and Meyer led the negotiations resulting in a complicated 16-page “protocol” for making claims and payments to nursing homes.

The order signed on March 11 gives the settlement preliminary approval as “fair, reasonable, and adequate.” Notice will be sent to all class members, and they can “opt out” of the class action, if they want, to pursue their own claims for corrected co-payment calculations. But those doing so will be subject to a limit of three months for most old bills, which does not apply to the settlement, and they will not automatically have any unpaid portion of their old bills forgiven by the nursing home.

The settlement is scheduled for final approval on May 12, 2010.

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Court Distinguishes Between Undue Influence, Incapacity

DECEMBER 28 , 2009  VOLUME 16, NUMBER 66

Contrary to public perceptions, will contests are actually rare. In fact, few wills are written in such a way that anyone would benefit from a contest — most wills leave property to the same people who would inherit if there was no will. When there is a will contest, however, the two most common grounds are allegations of (1) lack of testamentary capacity, or (2) undue influence exerted by someone. A recent Texas case highlights the differences between those two allegations.

Evelyn Marie Reno died at age 81. She had been married twice, and left three children from her first marriage and one daughter from the second. The youngest child, Jan LeGrand, did not get along well with her half-siblings. Relationships between Ms. Reno and the three children from her first marriage were also strained — at least partially because two of them had initiated a guardianship proceeding (which was later dismissed) against their mother.

Ms. Reno spent the last year of her life in a nursing home. Ms. LeGrand visited her regularly, paid all her bills, and kept her location a secret from her half-siblings. At some point in the year before she died, Ms. Reno asked her daughter to help her prepare a new will disinheriting her other three children and leaving her entire estate to Ms. LeGrand.

The will was prepared (by Ms. LeGrand), and signed in Ms. Reno’s nursing home room. The witnesses were a hospice worker and chaplain, and the notary public was a nursing home employee. Ms. LeGrand was asked to leave the room while the three non-family members discussed the will and watched her sign it.

After Ms. Reno’s death the will was filed with the probate court by Ms. LeGrand. The three half-siblings proposed an earlier will, which left most of the estate to the four children equally.

The Probate Court ruled that Ms. Reno lacked testamentary capacity at the time the last will was signed, and that she was subjected to undue influence by her daughter. The earlier will (and a codicil) were instead admitted to probate.

The Texas Court of Appeals analyzed the findings of the Probate Court, and modified the basis for its findings — while not changing the result. The evidence, according to the appellate court, showed that Ms. Reno DID have testamentary capacity. Though she was often confused, the two witnesses and the notary agreed that the will was signed on a good day. Evidence of confusion and occasional disorientation on days before and after the will signing was not enough to overcome the testimony that she knew what she was signing, who her children were and what she intended to do at the time she signed the will.

The appeals judges agreed with the Probate Court, however, on the subject of undue influence. A key part of the evidence considered by the Court of Appeals: the fact that the will was actually prepared by Ms. LeGrand. As the Court wrote: “the fact that LeGrand personally prepared teh will without the intervention of an atotrney or other third party is significant.”

Also important to the court’s analysis: Ms. LeGrand had sole access to Ms. Reno for more than a year (during which time their mother’s whereabouts were not shared with the other three children). During that time, noted the Court of Appeals, Ms. Reno was completely dependent on Ms. LeGrand for bill-paying, care management and personal contact.

A more subtle distinction is drawn by the appellate judges with regard to Ms. Reno’s declining mental status. Though her condition at the moment of signing the will did not support the allegations of lack of testamentary capacity, her growing confusion and periodic mental weakness made her susceptible to undue influence.

Finally, the Court of Appeals notes that the will prepared by Ms. LeGrand for her mother was a complete shift from her prior wills. In each of those she made specific bequests to her four children and thirteen grandchildren, plus hospitals, her church and her pastor. The last will, however, left everything to one daughter — and this significant change in her dispositive plan was yet another indication of undue influence.

Though family members often confuse the concepts of testamentary capacity and undue influence, the legal analysis of the two different approaches to will contests is well-developed. It is also important to note that not every attempt to talk someone into making a new will is automatically subject to challenge. As the Reno court opined, in somewhat dry legalistic language: “One may request, importune, or entreat another to create a favorable dispositive instrument, but unless th eimportunities or entreaties are shown to be so excessive as to subver the will of the maker, they will not taint the validity of the instrument.”

The difference between “lack of testamentary capacity” and “undue influence” is legalistic, to be sure, but it is more than just academic. Interestingly, the Texas Court of Appeals noted that there is a difference in the burden of proof borne by the parties in the two different kinds of cases. In a case alleging lack of testamentary capacity the proponent of the will has the burden of proving that the testator understood what she was doing. In an allegation of undue influence, the challenger carries the burden of proof.

That means that each side in Ms. Reno’s case met their burden of proof. That is, Ms. LeGrand showed that her mother understood what she was doing, but the other three children demonstrated that Ms. LeGrand unduly influenced their mother. Estate of Reno, December 18, 2009.

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January Session Will Focus On Paying for Long-Term Care

NOVEMBER 16, 2009  VOLUME 16, NUMBER 61

Do you wonder what will happen if you are no longer able to live independently? Will you have to “go into a home?” Is a nursing home the only way to go, or are there other living situations that might allow more independence? What will happen to your spouse? And who will pay for all of this? Medicare? Medigap insurance? Your kids? Is long term care insurance the answer?

Elders whose care is not covered by Medicare (and beware, Medicare covers only a limited period of “skilled” nursing care) have to look to Medicaid for help. Arizona has its own Medicaid program, the Arizona Long Term Care System (ALTCS). Unlike Medicare, which is available to elders above age 65, ALTCS applicants must qualify both medically and financially. The financial eligibility criteria are stringent and complex.

Victoria Blair, one of the partners at Fleming & Curti, PLC, offers a two hour program to address just these sorts of questions on Wednesday, January 27th and Thursday, January 28th. We will serve a continental breakfast and we promise to answer your questions about planning for (and paying for) long term care.

Both programs will include a discussion of the basics of ALTCS. Wednesday’s session will focus on our clients who are considering long term care options for themselves or a loved one. Thursday’s session will be a little more technical, and aimed at case managers, social workers and other professionals who want to better assist their clients. You are welcome to attend either session. There will be no charge for either program, but space is limited and reservations must be secured in advance.

Who should come to ALTCS School? Anyone who is thinking seriously about nursing home care, assisted living or in-home care, or is just curious about the options. Anyone who is contemplating purchasing a long term care insurance policy. Case managers and social workers are welcome (especially at Thursday’s session) and will leave with a clearer understanding and with answers to their questions about the system.

Ms. Blair will explain the medical and financial eligibility criteria for ALTCS. She will review what resources the “healthy” spouse can keep — a house, a car, money to live on — and strategies for “spend down.” She will review the penalties for making gifts (or selling assets for less than their value) to family members. And she will go over long term care insurance policies: what they cost, what they cover, and whether purchasing such a policy makes sense for you and your family.

To attend: contact Yvette in our office at (520) 622-0400 or by e-mailing our office. Please be sure to provide us with contact information and indicate whether you prefer to attend the client/layperson session on January 27th or the social worker/case manager/allied professional session on January 28th.

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Guardian Not Personally Liable For Alleged Lack of “Due Care”

APRIL 27, 2009  VOLUME 16, NUMBER 38

Who has the obligation to get a proper Medicaid application filed for someone in a nursing home? Can the nursing home resident’s children, spouse, guardian or conservator be forced to pay for care after the patient’s money has run out but before the state Medicaid agency receives the application paperwork in proper order?

The usual answer to that question is a simple “no.” There are exceptions — a spouse may have an obligation of support, for instance, or a child may have separately promised the nursing home that the bills will be covered. The way this question most frequently comes up, though, is when a guardian or a child (and they may sometimes be the same person, though in today’s illustration the guardian was a public agency) has signed the facility’s admission documents but has not followed through with getting Medicaid eligibility established promptly.

That was essentially what happened with Eloise Selby, who resided at Arbor View Healthcare and Rehabilitation Center in St. Joseph, Missouri. Bonnie Sue Lawson, who was the Buchanan County Public Administrator, was appointed as Ms. Selby’s guardian in 2004. A Medicaid application was already pending, but the agency did not have the paperwork necessary to determine the value of two small life insurance policies owned by Ms. Selby. Her new guardian promised to get the missing forms filed.

A month later, with no paperwork in sight, the Medicaid agency denied coverage. A second application filed a month after that included the missing forms, but Ms. Selby was again denied benefits — this time because the value of the two policies exceeded the maximum permissible amount. Yet another month later, another application was filed — and denied for the same reason.

The essential problem with the application became clear at that point: someone would need to cash in the policies, and Ms. Lawson was guardian of the person but not conservator of Ms. Selby’s estate. A conservatorship proceeding was filed, the funds collected, and the final, successful Medicaid application filed a year after the initial involvement of the Public Administrator’s office.

The nursing home then sued the guardian for the fees (and legal costs) it had not collected from Ms. Selby while the failed Medicaid applications were pending. The home’s argument: while Ms. Lawson would not be personally liable for her ward’s nursing home costs in most cases, in this case she had failed to use “due care” in fulfilling her duties.

The trial court agreed, and entered a judgment in favor of the nursing home (and against the Public Administrator) for $16,779.65 — the difference between what the nursing home had collected from Ms. Selby’s income and what it would have collected. The judge also assessed attorney’s fees and costs of $6,597.00 against the Public Administrator.

The Missouri Court of Appeals disagreed, and reversed the finding in favor of the nursing home. In  the appellate court’s analysis, Ms. Lawson’s liability for Ms. Selby’s debts was limited to the money in Ms. Selby’s name. Although the admission contract included specific language requiring the Public Administrator to use “due care,” it also included a provision that dealt directly with the possibility of Medicaid eligibility denial. That more specific section limited the facility’s rights to receiving payment from Ms. Selby’s funds; the court agreed with Ms. Lawson that the specific section controlled over the more general provision. Five Star Quality Care v. Lawson, April 7, 2009.

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Discharge From Nursing Home Must Describe Placement Plans

APRIL 18, 2005  VOLUME 12, NUMBER 42

Samuel Paschall apparently posed some risk to himself and to the other residents of The Washington Home in Washington, D.C. From the day of his first admission to the nursing facility he had been closely monitored because he was difficult to handle, and becoming more so as time went on. When he complained of abdominal pain and was admitted to Walter Reed Hospital, the nursing home saw its chance—it issued what it called an “Advance Notice of Discharge” informing Mr. Paschall (and his daughter, who was managing his affairs) that he could not return to The Washington Home.

There were at least two problems with the notice of discharge sent by the Home. First, federal law requires that such notices must usually be given at least thirty days in advance. Second, any discharge notice from a nursing facility must include a description of the location to which the patient will be discharged. The Home’s notice did not meet either of those requirements.

Mr. Paschall’s daughter hired an attorney and challenged the notice with the District of Columbia Department of Health. An Administrative Law Judge heard the case, and agreed that the notice was deficient—although he ruled that the Home could issue a new notice that could comply with the federal and local requirements.

Instead, the Home did what nursing homes around the country too often do—it told Mr. Paschall’s daughter that his bed had been taken by a new patient, and there were no more Medicaid beds available. Mr. Paschall’s attorney returned to the Department of Health and requested an order that he would be entitled to return to the Home as soon as a Medicaid bed opened up. Ruling that Walter Reed Hospital had become the de facto discharge plan for Mr. Paschall, the Administrative Law Judge decided that an order compelling his readmission to the Home could only be issued by the courts. Mr. Paschall was instead released to a nursing home in nearby Maryland.

The District of Columbia Court of Appeals (the District’s highest court) disagreed with the Administrative Law Judge. The appellate court ruled that the Administrative Law Judge could apply the remedy urged by Mr. Paschall, and order his readmission to the Home. Before doing so, however, he would need to schedule a hearing to determine whether Mr. Paschall still wanted to return to the Home, as well as whether he had given up the right to return (as alleged by the Department of Health) by failing to cooperate with efforts to secure him a place. Most importantly, ruled the court, Mr. Paschall would need to establish that his return to the Home could be accomplished without jeopardizing other residents or himself. Paschall v. DC Department of Health, April 7, 2005.

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LPNs Awarded Damages In Wrongful Termination Case

APRIL 26, 2004 VOLUME 11, NUMBER 43

When LPNs Diane Owens and Alisa Main were fired from their jobs with Fayetteville Health and Rehabilitation Center in April, 2000, they were sure their dismissals were retribution. Ms. Owens and Ms. Main had each complained to Kristy Unkel, the Director of Nursing, about the care provided by several certified nurse assistants (CNAs) at the facility. Ms. Owens had even lodged a complaint with the Office of Long-Term Care about what she saw as abuse and neglect of Fayetteville patients.

At least six CNAs had signed a letter to the nursing home administrator, in which they insisted that Ms. Owens created a difficult work environment for them. The CNAs also claimed that Ms. Owens and Ms. Main had themselves abused and neglected patients. According to the CNAs’ complaints, Ms. Owens had failed to document one patient’s fall and fractured hip, and Ms. Main missed a patient’s scheduled medication and spoke harshly to another resident.

One problem with the CNAs’ allegations was that work schedules made their version of the facts difficult to believe, since Ms. Owens had not even signed to work on the day of the patient’s fall. The CNA accusing Ms. Main of missing a patient’s medication was not signed in to work on the date of that alleged incident.

Ms. Owens and Ms. Mains sued Fayetteville and Ms. Unkel, the Director of Nursing. They alleged that they were discharged in retaliation for their complaints, and that their reputations were injured by the false allegations on which the firings were based.

After four days of testimony an Arkansas jury found in favor of Ms. Main and Ms. Owens. The jury awarded damages totaling $332,740 to the two LPNs. The Arkansas Supreme Court upheld the award.

Fayetteville had argued that it had a duty to report allegations of elder abuse, and that it could not be sued for incidents related to its reports against Ms. Owens and Ms. Main. The problem with that theory, ruled the state’s high court, was that the jury had found that Fayetteville did not act in good faith when it filed reports.

The facility also argued that Ms. Owens and Ms. Main were “at-will” employees, and could be fired for any reason or no reason at all. The high court pointed out that public policy considerations require protection for individuals who report abuse or neglect of vulnerable seniors, and employers may not retaliate against employees for such reports. The jury found that the firings were retaliatory and the high court agreed. Northport Health Services v. Owens, April 8, 2004.

As it turns out, Fayetteville’s problems with claims of inadequate care have continued since the firing of Ms. Owens and Ms. Main. In November of 2000–less than a year after Ms. Owens and Ms. Main were discharged–Fayetteville fell so far below the level of care required by the Medicare program that civil penalties were imposed and the facility was denied payment for new Medicare admissions for a two-month period.

Fayetteville’s problems included failing to notify two residents’ physicians about emergency medical conditions, and failure to protect one resident from the possibility of inappropriate administration of medication by a visiting family member. The ruling of the Administrative Law Judge in Medicare’s action against Fayetteville is available online at http://www.hhs.gov/dab/decisions/CR1050.htm. More recent information (still not encouraging as of the most recent survey date) is synopsized on the MemberOfTheFamily.Net website, which includes state-by-state and facility-by-facility information on nursing home survey results.

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Fund Earmarked For Nursing Homes Frozen In Budget Crisis

DECEMBER 9, 2002 VOLUME 10, NUMBER 23

Nursing home operators, often joined by advocates of better care for seniors and the disabled, have maintained that government-set payment rates for nursing homes are inadequate to ensure quality care. Most of the focus of those complaints falls on Medicaid reimbursement rates and, to a lesser extent, Medicare payments for long-term care.

The State of Missouri came up with an interesting idea to address the problem. As part of its state Medicaid plan, it announced late in 2000 that it would begin paying an “enhanced” Medicaid reimbursement rate to seven nursing homes in the state, all of them owned and operated by local governments. Those government agencies, in turn, would forward the “enhanced” payments back to the state, which would then make the money available to all nursing homes, public or private, for one-time “quality and efficiency” grants.

This complicated scheme would improve the profitability of, and the quality of care provided by, nursing homes, while costing the state very little. Because the federal government pays about 60% of Missouri’s Medicaid costs, it would amount to a transfer of funds from the federal government to state coffers, with ultimate distribution back to nursing home operators.

By budget time in 2002, Missouri had accumulated $133 million in “enhanced payments.” Last year’s budget provided for most of that money to be returned to individual nursing homes.

Then disaster struck. Missouri, like most of the states, was suddenly faced with a huge budget shortfall. Revenues fell $1.3 billion short of projections, and the state scrambled to cut spending.

Among the thousands of programs Governor Bob Holden cut was the remaining $20 million in nursing home quality and efficiency grants. Nursing homes cried foul, arguing that the money was never really the state’s to cut, since it had come from federal revenues into a fund earmarked for nursing homes, but a Cole County Circuit Court judge disagreed.

On appeal, the Missouri Supreme Court affirmed the lower court—and agreed with the Governor. The Missouri State Constitution requires that the state’s budget remain in balance, noted the Court. In order to accomplish that, the Governor has broad powers to withhold money, even after the it has been budgeted by the Legislature. The fact that the “enhanced payments” fund did not fall short of its own revenue projections does not prevent the Governor from choosing that fund to bear some of the brunt of budget cuts. Missouri Health Care Association v. Holden, December 2, 2002.

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Nursing Home Fined $320,000 Over Care of Ventilator Patients

AUGUST 19, 2002 VOLUME 10, NUMBER 7

When a nursing home demonstrates that it is unable to provide consistent quality care there are several ways to correct its problems. The marketplace offers one corrective opportunity, of course. Personal injury lawsuits may effect some improvement in future care, if only because the nursing home’s insurance provider may insist on changes before agreeing to continued coverage. Perhaps the most direct control, however, is provided by federal and state government regulation.

As an example, consider Fairfax Nursing Home in Berwyn, Illinois. The facility has a history of problems with ventilator-dependent patients—those who require a mechanical device to assist with their breathing. One of the first incidents occurred in 1996, when a patient on a ventilator experienced a respiratory emergency. Staff members responded appropriately and administered oxygen, but one therapist turned off the patient’s ventilator to silence its alarm. Once the patient was stabilized the therapists left the room, but no one remembered to turn the ventilator back on, and the patient died.

Over the next year state health inspectors made surprise inspection visits and followed patients’ charts. In at least five cases inspectors determined that Fairfax employees were not following their own regulations for handling ventilator-dependent patients, and that a “civil monetary penalty”—a fine—should be imposed. The state suggested that the federal government levy a fine of $3,050 for each day that Fairfax violated its own protocols. Since the violations stretched over 105 days, the total fine amounted to $320,000.

Fairfax appealed the imposition of a fine to the federal Court of Appeals. The nursing home argued that the fines should have been imposed at a much lower rate—as low as $50 per day of violation—because its deficiencies did not place patients in “immediate jeopardy.”

The Court of Appeals upheld the fine. The Court agreed with the Administrative Law Judge who initially heard the case, who had held that any respirator-dependent patient at Fairfax during the period in question was endangered by “the systemic incapacity of the facility to render the necessary care to sustain life and avoid serious injury.” Fairfax Nursing Home, Inc., v. United States Department of Health and Human Services, August 15, 2002.

Nursing home residents and their families have limited access to information about the quality of care in individual facilities. The results of periodic surveys such as those made at Fairfax Nursing Home, however, are available to consumers and interested persons. The record of inspection results at every nursing home receiving Medicare or Medicaid funds can be reviewed online at www.medicare.gov/NHCompare/home.asp. More information about how family members can help ensure better nursing home care for their loved ones can be found through the National Citizens’ Coalition for Nursing Home Reform at www.nccnhr.org.

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Long Term Care Industry Must Be Accountable, Says Advocate

AUGUST 21, 2000 VOLUME 8, NUMBER 8

By Patricia Nelson*

I disagree with a recent Elder Law Issues assertion that higher reimbursement rates are automatically required to meet nursing home staffing needs (see More On DHHS/HCFA Report Of Nursing Home Staff Shortages). Before such conclusions can be made, I await Sen. Charles Grassley’s US Committee on Aging report that will analyze some bankrupt nursing chains’ finances. The report will evaluate how nursing homes’ profits and obscene salaries/perks could instead have been used to pay for promised long-term care (LTC) services.

A recent NY Daily News article published profit margins and owner salaries from several NY nursing homes. Both totals were outstanding—mostly in the million dollar range—clearly showing why NY has one of the highest Medicare/Medicaid reimbursement rates in the nation. Since the majority of these facilities annually file Medicaid Cost Reports, the government is well aware how its monies have been spent. Since HCFA is solely responsible for monitoring reimbursements and has data at its disposal to alert itself to wrongdoing, how is it possible that so much public money entered the profiteers’ pockets?

There can be no other answer why 25% of America’s nursing homes remain dangerous places to live. Why laws and regulations are routinely ignored or circumvented to accommodate the nursing home industry—rather than protecting its residents. Industry campaign contributions are key to keeping government’s regulatory agencies clueless on how to solve the nursing home crisis. Placing industry insiders in high HCFA regulatory positions successfully stops any meaningful industry reforms from reaching the streets. The recent decision to return higher reimbursement rates to the industry is typical of how government monies are routinely awarded without necessary accountability.

The industry in its arrogance has become omnipotent. It routinely bypasses its legal obligations to provide a service for which it is paid. It rewards itself with obscene profit margins and compensation by purposefully withholding resident services for which consumers have paid and are legally entitled to have. These fraudulent activities continue unabated because government is well compensated by industry to ignore the real problems the industry creates.

And what recourse do consumers have to stop these bad practices? Clearly, each state’s oversight systems are seriously compromised. Numerous studies by the US Government Accounting Office conclude that the states do not adequately protect LTC consumers. In addition, consumers are prevented by state legislation from seeking help from local law enforcement as they must submit all complaints to their ombudsman office, which has no training in criminal investigations. In short, on the merry-go-round of LTC reimbursements, the industry always gets the brass ring.

Higher reimbursement rates without industry accountability is not the answer. Complicity between the nursing home industry and government must be exposed and legislation requiring a major overhaul in favor of industry accountability must be passed. The insanity of today’s LTC practices will be eliminated when the nursing home industry is subjected to the same civil and criminal laws—and procedures—as the rest of us.

*Patricia Nelson is executive director of Glenda’s House, Princeton, NJ, an affiliate of the Association for Protection of the Elderly. Glenda’s House conducts investigative research and advocates on behalf of New Jersey’s elder and disabled consumers by exposing corrupt practices that violate their rights. Ms. Nelson has written numerous articles on nursing home reform issues and is a noted public speaker for elder and disabled rights.

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More On DHHS/HCFA Report Of Nursing Home Staff Shortages

AUGUST 7, 2000 VOLUME 8, NUMBER 6

Last week Elder Law Issues reported on a government study of nursing home staffing and safety. This week we continue that report. The full DHHS/HCFA report is now online.]

As described last week, the Department of Health and Human Services report recommends minimum staffing levels for nursing aides, Registered Nurses and Licensed Practical Nurses in nursing homes. It also suggests optimum levels. Almost two-thirds of U.S. nursing homes fall below those optimum staffing levels, and about half are below even the minimum levels for RNs and LPNs.

Why are staffing levels so low? Part of the problem, according to the government report, is the government itself. In recent years the federal Medicare and Medicaid programs have moved aggressively to cut medical costs, with particular emphasis on long-term care costs. Particularly notable was the Balanced Budget Act of 1997, which reduced government spending largely through reductions in Medicare and Medicaid financing, and with particular emphasis on long-term care, hospital care and drug costs. One result: many nursing homes can not afford adequate staffing.

A related problem in recent years has been the growing number of individual nursing homes, regional and national nursing home chains facing financial difficulties. A number of national chains have filed bankruptcy proceedings in the past eighteen months. Vencor, Sun Healthcare, Integrated Health Services and Mariner Post-Acute Network, four of the largest chains in the country, all filed for bankruptcy protection during that time period. Combined, these troubled organizations operated well over a thousand nursing homes.

The DHHS study looked at staffing ratios in those financially troubled nursing homes as compared to other chains and individual homes. Not surprisingly, staffing in the bankrupt chains decreased in the last four years—but so did staffing levels in the non-bankrupt chain facilities. Staffing levels in non-chain nursing homes, meanwhile, increased slightly during the same time period.

What will Congress and the Administration do about the decline in nursing home staffing? Republican Senator Chuck Grassley of Iowa, Chairman of the Senate’s Special Committee on Aging, provided one preview. In a press release issued days after the report was received, the Senator intoned that “the suffering of nursing home residents is intolerable. Bedsores and malnutrition turn the stomach and hurt the conscience. They beg for a solution, the sooner, the better.”

Senator Grassley “plans to look into options to encourage states to increase Medicaid rates for nursing homes if they agree to hire more staff with the increased rates.” In addition, the Senator promises to consider giving the nursing home industry back some of the money cut from Medicare budgets by the Republicans’ “Balanced Budget Act of 1997″—provided that the nursing home industry uses the money to hire more staff.

Will this solve the nursing home staffing problem? Perhaps. Direct government regulation may work better. In those states with minimum staffing requirements, the report indicates that staffing approaches the levels deemed acceptable by its analysis. But if staffing levels are increased by government order, but no new money is added to the system, those nursing homes already experiencing financial difficulties can hardly be expected to thrive.

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