Regulating ownership of skilled nursing facilities and nursing facilities

(a)

Requirement To submit timely disclosures To admit new residents of skilled nursing facilities and nursing facilities

Section 1124 of the Social Security Act (42 U.S.C. 1320a–3) is amended by adding at the end the following new subsection:

(d)

Suspension of certain payments for certain entities that fail To submit timely ownership disclosures

(1)

In general

In the case of a covered nursing facility that fails to submit specified information to the Secretary by the date that is 30 days after the date that such information is required to be submitted pursuant to regulations or contract provisions described in subsection (a)(1) (or, in the case of a party with an ownership interest in such facility that fails to submit information to the Secretary in accordance with paragraph (3))—(A)the Secretary shall suspend payment under title XVIII with respect to items and services furnished to a specified resident during the applicable payment suspension period; and(B)the Secretary shall suspend payment under title XIX for medical assistance consisting of items and services furnished by such facility to such a resident during such period.(2)

Quality review

(A)

In general

The Secretary shall, with respect to each covered nursing facility, on a periodic basis, conduct a review of the quality of care furnished by each such facility using information reported by such a facility as part of a survey conducted under section 1819(g) or 1919(g) or as part of the minimum data set described in section 1819(f)(6) or 1919(f)(6). For purposes of conducting such reviews, the Secretary shall establish quality metrics relating to such information to evaluate each such facility.(B)

Quality metrics

(i)

In general

For purposes of subparagraph (A), the quality metrics described in this subparagraph are quality metrics specified by the Secretary, taking into account input from the Data Liaison Team established under section 2(c) of the LINHQ Act, that may be used to evaluate the information described in subparagraph (A). Such metrics shall include a metric with respect to the average number of direct care hours furnished to residents.(ii)

Specification

The Secretary shall publish on a public website each quality measure specified under this subparagraph at least 180 days prior to such quality metric being used in a quality review under this paragraph, except that, with respect to such reviews beginning during the 1-year period beginning on the date of the enactment of this subsection, the Secretary may use any such metric that the Secretary publishes on such a website at least 14 days prior to the beginning of such review.(C)

Establishment of standards

The Secretary shall specify standards with respect to quality measures described in subparagraph (B), taking into account input from the Data Liaison Team so described. Such standards shall include, with respect to the metric relating to the average number of direct care hours furnished to residents, a standard of at least 4.1 direct care hours furnished per resident per day.(D)

Notification and publication of facilities falling below standards

If the Secretary determines that a covered nursing facility has failed to meet a standard established under subparagraph (C) with respect to a quality measure described in subparagraph (B) pursuant to a review conducted under this paragraph, the Secretary shall—(i)notify such facility of such determination; (ii)publish the name of such facility on the Care Compare website (or a successor website) described in section 1819(i) with an explanation that such facility has failed to meet such standard; and(iii)suspend payment under title XVIII to such facility, and payment under title XIX for medical assistance furnished by such facility, until such facility demonstrates that such facility has met such standard.(3)

Submission of third-party information

The Secretary shall establish a process under which, with respect to a covered nursing facility, any party that has an ownership interest in such facility and that also has an ownership interest in an entity that contracts with such facility to provide any service to such facility submits to the Secretary the following information:(A)A balance sheet detailing the assets, liabilities, and net worth of the entity.(B)A statement of income, expenses, and operating surplus or deficit.(C)A statement of cashflows, including ongoing and new capital expenditures and depreciation.(4)

Submission of additional info by facilities

The Secretary shall require a covered nursing facility, as part of the information submitted under subsection (a)(1), to provide to the Secretary a detailed document outlining a visual representation of the facility’s structure that includes both of the following:(A)Any entity in which any party that has an ownership or control interest in the covered nursing facility and that also has an ownership interest or control interest of 5 percent or more in such entity that provides any service, facility, or supply to such covered nursing facility.(B)Unrelated parties that provide services to such facility or to facilities that are operated, conducted, owned, managed, or maintained by the organization, including management companies and property companies, and that are paid more than $200,000 by such facility.(5)

Definitions

In this subsection:(A)

Applicable payment suspension period

The term applicable payment suspension period means, with respect to specified information required to be submitted by a covered nursing facility pursuant to regulations or contract provisions described in subsection (a)(1) (or with respect to third-party information required to be submitted by a party with an ownership interest in such facility), the period beginning on the day that is 30 days after the date that such information is required to be so submitted by such facility (or party) and ending on the date that is 5 days after such facility (or party) submits such information.(B)

Covered nursing facility

The term covered nursing facility means a skilled nursing facility (as defined in section 1819(a)(1)) or a nursing facility (as defined in section 1919(a)(1)).(C)

Specified information

The term specified information means any information required to be submitted under subsection (a)(1).(D)

Specified resident

The term specified resident means a resident of a covered nursing facility who is admitted to such facility during an applicable payment suspension period with respect to such facility.(E)

Ownership interest

The term ownership interest means a direct or indirect interest of at least 5 percent.

(b)

Requiring annual reporting for disclosing entities

Section 1124(c)(3)(A) of the Social Security Act (42 U.S.C. 1320a–3(c)(3)(A)) is amended by adding at the end the following new sentence: The Secretary shall, not later than 90 days after the date of the enactment of this sentence, amend such regulations to provide that such information is reported not less frequently than annually.. (c)

Increasing oversight of facilities

(1)

Data Liaison Team

(A)

In general

Not later than 180 days after the date of the enactment of this Act, the Secretary of Health and Human Services (in this subsection referred to as the Secretary) shall establish a task force (in this paragraph, referred to as the Data Liaison Team) to carry out the activities described in subparagraph (B).(B)

Activities described

For purposes of subparagraph (A), the activities described in this subparagraph are—(i)reviewing information submitted under section 1124 of the Social Security Act (42 U.S.C. 1320a–3) to identify any common ownership patterns with respect to skilled nursing facilities’ (as defined in section 1819(a)(1) of such Act (42 U.S.C. 1395i–3(a)(1))) and nursing facilities’ (as defined in section 1919(a)(1) of such Act (42 U.S.C. 1396r(a)(1))) that—(I)are at least 30 days delinquent in supplying the ownership information required pursuant to section 1124(a)(1) of such Act (42 U.S.C. 1320a–3(a)(1));(II)in the preceding quarterly reporting period, failed to meet a payroll based journal level of 4.1 hours of direct resident care hours (including registered nurse, licensed practical nurse, and nursing assistant or certified nursing assistant care) per resident per day; or(III)in the preceding year of reporting, failed to meet any quality standard established by the Secretary under subsection (d) of such section or established by the Secretary or a State with respect to surveys conducted under section 1819(g) or 1919(g) of such Act (42 U.S.C. 1395i–3(g); 42 U.S.C. 1396r(g)); (ii)assessing potential misuse of payments under titles XVIII and XIX of such Act (42 U.S.C. 1395 et seq.; 1396 et seq.) through review of data collected by the Treasury Department, facility organization charts, and cost reports submitted under such title XVIII;(iii)on a monthly basis, reporting any disclosing entities (as defined for purposes of section 1124 of such Act (42 U.S.C. 1320a–3)) with common ownership identified pursuant to clause (i), or with respect to which the Team has found a potential misuse of payments pursuant to clause (ii), to the Interagency Board, the Office of Inspector General of the Department of Health and Human Services, and the Department of Justice; (iv)regularly reviewing skilled nursing facilities and nursing facilities with a one-star rating in health inspections or staffing on the Care Compare website (or a successor website) described in section 1819(i) of such Act (42 U.S.C. 1395i–3(i)), as well as such facilities that are ranked among the lowest 20 percent of facilities on such website with respect to quality; and(v)at the discretion of the Data Liaison Team, requiring skilled nursing facilities and nursing facilities to submit to the Team information on whether such facilities—(I)do business (including business relating to laundry services, staffing agencies, food and beverage services, medical supplies, or consulting) with any other entity (including a specification of such other entity);(II)lease their building or property from another entity (including a specification of such other entity); or(III)share an individual who has directly or indirectly (as determined by the Secretary pursuant to a notice and comment rulemaking) any ownership interest of 5 percent or more in an entity described in subclause (II) and the skilled nursing facility or nursing facility.(C)

Provision of information

(i)

Treasury information

For purposes of subparagraph (B)(ii), the Secretary of the Treasury shall furnish to the Data Liaison Team such information as such Team may request.(ii)

Facility information

For purposes of subparagraph (B)(v), a skilled nursing facility or nursing facility shall submit to the Data Liaison Team such information as may be requested by the Team. Any failure to submit such information shall be deemed to constitute a violation of section 1124(a)(1) of such Act (42 U.S.C. 1320a–3(a)(1)).(D)

Composition

(i)

In general

The Data Liaison Team shall consist of—(I)the Administrator of the Centers for Medicare & Medicaid Services of the Department of Health and Human Services (or designee); and(II)any other employees of the agency specified in subclause (I) (as determined appropriate by the Secretary).(ii)

Manager

An employee of the Centers for Medicare & Medicaid Services of the Department of Health and Human Services shall manage the Data Liaison Team.(2)

Interagency Board

(A)

In general

Not later than 180 days after the date of the enactment of this Act, the Secretary of Health and Human Services shall establish a task force (in this paragraph, referred to as the Interagency Board) to carry out the activities described in subparagraph (B).(B)

Activities described

For purposes of subparagraph (A), the activities described in this subparagraph are—(i)reviewing the list of disclosing entities reported pursuant to paragraph (1)(B)(iii) to determine which entities to refer to the Office of Inspector General of the Department of Health and Human Services and the Department of Justice for further investigation;(ii)reporting any such referrals to the Data Liaison Team, and the reasoning for any such referrals, not later than 7 days after such a referral is made; and(iii)on an biannual basis, submitting to Congress a report on the findings made by and results from any referrals made by the Interagency Board, including any reason for not pursuing action on referrals in the event that action was not taken (if the Interagency Board has been informed of such reason).(C)

Composition

(i)

In general

The Interagency Board shall consist of—(I)the Administrator of Centers for Medicare & Medicaid Services of the Department of Health and Human Services (or designee);(II)the Inspector General of the Office of the Inspector General of the Department of Health and Human Services (or designee); (III)the Attorney General of the Department of Justice (or designee); and(IV)any other employees of the agencies specified in subclauses (I) through (III) (as determined appropriate by the Secretary of Health and Human Services).(ii)

Chair

An employee of the Office of Inspector General of the Department of Health and Human Services shall chair the Interagency Board.