Member Article

Certificate of Need Strategies for New Nursing Home Beds Special Population Beds are Re-Approved At its March 2006 meeting, the Michigan Certificate of Need (“CON”) Commission took action to re-approve several state-wide pools of nursing home beds that are set aside to serve special populations, including: Alzheimer’s Use 60 beds Hospice 30 beds Religious Use 20 beds The Commission reserved 22 special population beds on a non-specified basis for future use. The special population bed pool for ventilator-dependent patients was eliminated, as was the special pool for skilled nursing home beds in rural areas. The next application date for beds from the special pools (or any comparative review CON application) is June 1, 2006. Requirements Attached to Special Population Beds Re-approval of these special population beds on a state-wide basis may give some providers more options for meeting special care needs in planning areas that do not demonstrate an overall bed need. However, all of the special population beds come with various “strings attached” in the form of specific CON requirements. For example, only a licensed hospice provider may apply for beds from the hospice special population pool. Other requirements apply to the special pools for Alzheimer’s beds and religious use beds. Thus, providers need to review carefully the Addendum to CON Review Standards for Nursing Home/Hospital Long-Term Care Unit Beds before preparing or submitting a CON application and obtain guidance, as appropriate, as to any provisions that are unclear. In addition, providers should be aware that if beds are awarded from one of the special population pools: • These beds remain subject to the applicable special CON requirements for as long as the special beds are operated. • Requirements for special population beds survive a change of ownership of the facility, and therefore encumber subsequent purchasers. • Beds from a special population pool cannot later be “converted” into “regular” nursing home beds unless (1) “regular” nursing home beds are available in the planning area to replace the special pool beds awarded and (2) appropriate CON approvals are obtained. CON Strategies Because of the restrictions on special population beds, providers in need of additional nursing home beds first should evaluate whether any “regular” nursing home beds may be available in the planning area. Over the last 18 to 24 months, some planning areas in Michigan have demonstrated a need for “regular” nursing home beds due to de-licensure of beds. Also, when considering new beds and units, providers may wish to consider a combination of beds (both general planning area and special population pools) and bed “replacement” concepts, such as the relatively recent CON pilot program for “greenhouse” design projects. Often, a provider can best address its physical plant and bed need issues through an artful combination of (1) new beds; (2) the conversion of existing multi-bed units to private or semi-private rooms; and (3) replacement of some beds to new space that is developed at the existing facility. Obviously, the financial feasibility of various types of special purpose units also will be a key factor, given special staffing or other requirements that may apply under the CON Standards. Survey and Certification Developments In March, CMS announced several changes to the survey and certification requirements and processes for skilled nursing facilities (“SNFs”) and nursing facilities (“NFs”). CMS issued two new Interpretive Guidelines, one new survey protocol, and a revision of Chapter 5 of the State Operations Manual itself. These documents advance several long-standing CMS nursing home quality of care agenda items: • Promote consistent deficiency citations among states and among the survey teams within a state • Enhance the management of complaint investigations to promote continuous SNF/NF regulatory compliance • Improve residents’ quality of life, with emphasis upon “culture change” principles • Enhance SNF/NF management and oversight of resident care and services. New Interpretive Guidelines The two new Interpretive Guidelines deal with F-tags 248 and 249 (activities program and activities director) and 520 (quality assessment and assurance). Activities. In the Guidelines to F-tags 248 and 249, CMS expects SNF/NFs to offer on-going activities that are meaningful, not childish, that are individually tailored to resident interests and capacity, and that accommodate residents’ physical and cognitive impairments and behavioral concerns. Activities are to encompass more than the formal activities calendar with which most SNF/NFs are already familiar. They can include care planned chores, spontaneous small group activities, or pursuit of individual interests with or without direct staff involvement. Staff are to adjust the delivery of clinical care, such as therapy or medication administration (if not medically contraindicated), to enable residents to participate in activities of choice. CMS’ major theme is that facility schedules must accommodate the resident’s patterns, interests and needs—rather than asking the resident to change life-long habits, or forego life interests and needs to “fit” the facility’s pre-existing schedule and operations. A secondary CMS theme is that activities are equally as important as clinical care because of the value that many residents place upon continuing to live a meaningful and useful life while at the facility. This new Interpretive Guideline is CMS’ clearest endorsement of “culture change” principles to date. QA Committee. The new Interpretive Guideline at F-tag 520 demands that SNF/NFs enhance their quality assurance committees so that they: • Proactively identify possible quality concerns that have not yet occurred • Remedy quality concerns that have already occurred • Coordinate with the Medical Director’s oversight of all clinical policies and procedures in the facility. The QA Committee is expected to meet quarterly, canvass all facility operations; modify policies, processes and procedures to improve quality, and tweak those modifications if they are not producing the desired results. It is the QA Committee’s role to self-police the facility in an effort to promote continuous regulatory compliance, quality improvement, and “customer satisfaction.” At the same time, CMS makes it clear that surveyors are not to review QA Committee documents to fish for possible deficiency citations, and are not to request minutes of the QA Committee that reflect the Committee’s consideration of quality concerns and corrective actions. Surveyors are directed to investigate the functionality of the QA Committee if they independently discover repeated deficiencies or clusters of deficiencies that the facility has not addressed. Surveyors are not to cite F-tag 520 automatically whenever the SNF/NF has a deficiency at another tag; surveyors must demonstrate a causal link between the deficiency and a failure of the QA process. New Survey Protocol CMS has introduced the concept of psychosocial harm in the scoring of the scope/severity of a eficiency. Surveyors are now instructed to consider whether a SNF/NF’s deficient practice caused emotional harm to a resident, in addition to considering whether it caused physical harm. Surveyors may measure emotional harm on the basis of the resident’s personal behavioral response, or the behavioral response expected from a “reasonable person” in the resident’s circumstances. Either psychosocial harm or physical harm is now sufficient to score a deficiency at the D or higher level of severity. Proof of a causal link between a deficient practice and a psychosocial outcome is likely to be a challenge for both surveyors and the SNF/NF. Complaint Investigations Finally, CMS re-organized and re-wrote the Chapter of the State Operations Manual dealing with complaint investigations. CMS’ new computerized complaint tracking system will enable state survey agencies to better prioritize complaint allegations. CMS classifies any facility fire with injury or death as an survey agency to involve the CMS Regional Office and possibly the Central Office in the investigative and corrective process. The computerized complaint tracking system will also enable the state survey agency to better monitor SNF/NF regulatory compliance and mete out sanctions, including civil money penalties for past non-compliance. Conclusion CMS expects to issue additional new Interpretive Guidelines in 2006 and 2007 dealing with other critical quality of life and quality of care issues, such as nutrition, drug management, and end-of-life care. SNF/NFs should analyze the March CMS issuances, and those still to be issued, in the broader context of CMS’ policy agenda of improving facilities’ internal accountability systems, improving the survey and enforcement system, and improving resident quality of life without sacrificing quality clinical care. SNF/NFs that have not yet considered “culture change” will find both CMS and market forces requiring that they do so. immediate priority for investigation, and instructs the state Compliance Alert: Expect Ongoing Scrutiny of Medicare RUGs and MDS Function The Office of Inspector General of the Department of Health & Human Services (“OIG”) recently released a follow-up to its 2001 report entitled “Nursing Home Resident Assessment, Resource Utilization Groups.” The Good News from the follow-up OIG report is that SNFs have improved the accuracy of MDS assessments and assignment of Resource Utilization Groups (“RUGs”) for inpatient SNF admissions. In the 2001 study, the OIG found that 46% of residents in its sample received an upcoded RUG, whereas 30% of residents received a downcoded RUG. The follow-up report issued in February 2006 showed an overall improvement in MDS accuracy and RUG assignments, with an error rate of only 26% of the RUGs in the sample. The Bad News is that a 26% error rate in MDS completion and RUG assignments is still significant. According to the OIG, 11 MDS items were most frequently inconsistent with documentation in the medical record and related to an inappropriate RUG. These 11 MDS items all shared three common characteristics and involved: • Some type of look-back period to determine what care had been provided, particularly with respect to periods prior to admission • Multiple assessors (i.e., two or more staff assessments to determine the item) perhaps because different staff had varying observations of a resident’s abilities, because the resident’s condition changed during the day, or because MDS measurements were unclear • Calculations of some type, such as computation of the number of minutes or days of therapy, recorded on the MDS which did not match the medical record. The following table summarizes these specific issues and the OIG’s determination as to the cause of the errors: CMS’ Plans CMS concurred with the OIG’s findings and indicated that CMS action on this issue may include: • Web-based training programs for the Resident Assessment Instrument. • Ongoing communications with stakeholders, such as State Survey Agencies, consultants and trade associations, regarding the MDS. • Directions to fiscal intermediaries and Program Safeguard Contractors to continue to assess MDS information through the routine medical review process. • Incorporate the OIG findings into educational efforts to improve the accuracy of the MDS. Provider Response Providers should be prepared for increased scrutiny of the MDS process during Medicare certification surveys, and should attempt to avoid deficiencies for MDS errors— particularly computational problems that may be easy to prevent. Also, to the extent that any MDS errors result in a higher RUG than the medical record supports, providers should be alert to potential voluntary disclosure and overpayment requirements—particularly if there is evidence of a pattern of upcoding. Clearly, every provider should take steps now to improve the accuracy of its MDS process and ensure that all claims submitted are consistent with documentation in resident medical records. With respect to some of the “look-back” issues cited by the OIG, facilities should consider in-service training to improve medical record documentation and modify the medical record format to improve accuracy.