Chairman Grassley, Senator Breaux, distinguished Committee members, thank you for
inviting me to discuss our continuing efforts to improve protections for nursing home
residents. I would also like to thank the General Accounting Office (GAO) for its
important evaluations of State responses to consumer complaints about nursing homes and of
additional steps needed to strengthen enforcement of Federal quality standards. And I
would like to thank the Office of the HHS Inspector General for its reports on nursing
home issues, as well.
We have made substantial progress in improving nursing home resident protections. The
GAO's new reports, Complaint Investigation
Process Inadequate to Protect Residents and Additional Steps Needed to Strengthen
Enforcement of Federal Quality Standards, look at States where problems are most
serious over a time period before we had implemented most provisions of the nursing home
enforcement initiative that we announced last July. We undertook our nursing home
enforcement initiative in response to intolerable situations that have caused our most
vulnerable citizens to suffer. The initiative includes several steps to:
- address preventable problems such as bedsores and malnutrition,
- crack down on repeat offenders,
- strengthen State inspections, and
- improve Federal oversight.
The new GAO reports again document intolerable situations, and make clear that we must
take additional steps to protect nursing home residents. We must ensure that States
improve responses to and tracking of consumer complaints. We must also improve consistency
in handling terminations of facilities. These and other new steps must be incorporated
into our proactive initiative to ensure that nursing homes comply with care and safety
We generally concur with the GAO's
recommendations, and are already taking actions to address them. Specifically, we
- directed all State survey agencies to investigate any complaint alleging harm to a
resident within 10 working days;
- reiterated to States that complaints alleging immediate jeopardy to residents must be
investigated within two days;
- stressed to States that they must enter complaint information into our data system
- published a regulation last week allowing States to impose fines for each instance of a
- will now have Regional Office staff conduct surveys to verify nursing home resident
complaints when necessary.
HCFA Administrator Nancy-Ann DeParle and I both met last week with the Board of
Directors of the Association of Health Facility Survey Agencies, which represents State
survey agencies, to discuss the problems with complaint investigations and stress the
urgency of improving all enforcement efforts.
We will take additional steps to address problems identified by the GAO, and to ensure
that nursing home residents are safe and receive quality care. We will continue to work
with the States, Congress, residents and their families, resident advocacy groups, and
nursing home providers to ensure that nursing home care and safety standards are met and
the vulnerable residents are protected.
Protecting nursing home residents is a priority for this Administration and our agency.
We are committed to working with States, which have the primary responsibility for
conducting inspections and protecting resident safety. Some 1.6 million elderly and
disabled Americans receive care in approximately 16,800 nursing homes across the United
States. Through the Medicare and Medicaid programs, the federal government provides
funding to the States to conduct on-site inspections of nursing homes participating in
Medicare and Medicaid and to recommend sanctions against those homes that violate health
and safety rules.
In July 1995 the Clinton Administration implemented the toughest nursing home
regulations ever, and they brought about marked improvements. We monitored those
protections as they were implemented to see what else needed to be done. We and the GAO
found that many nursing homes were not meeting the requirements, and many States were not
sufficiently monitoring and penalizing facilities that failed to provide adequate care and
protection for residents. In July 1998, President Clinton announced a broad and aggressive
initiative to improve State inspections and regulation enforcement. Those efforts are
bringing about marked improvements as well.
The GAO reports examined events through December 1998. Since that time period we have
implemented many aspects of our new enforcement initiative. We are grateful that Congress
has provided essential funding for this initiative, and we look forward to working with
you to secure the $60 million increase for this initiative in the President's fiscal 2000 budget, as well as our legislative
proposal to require background checks of potential nursing home employees and establish a
STATE COMPLAINT INVESTIGATIONS
Consumer complaints are a valuable and unique source of information about the health
and safety of nursing home residents. We have been concerned about problems with State
survey agency responses to complaints, and in 1995 we developed complaint investigation
protocols for States in order to foster improvement. However, the GAO report makes clear
that these protocols are not sufficient.
We therefore have taken two new actions. First, we directed all State survey agencies
to investigate any complaint alleging actual harm to a resident within 10 working days. We
also stressed that States must promptly enter complaint information into our data system.
We will monitor State reporting of complaint information more closely to make sure they
Second, we initiated a Complaint Improvement Project to identify key elements of the
complaint process, address resident and consumer concerns about the process, and develop
standards for prioritizing complaints and determining appropriate time frames for
investigations. We will work to address concerns of residents, their families, consumer
representatives, and representatives of the Administration on Aging's Ombudsman program in this project.
SPECIFIC GAO RECOMMENDATIONS
As stated above, we generally concur with the recommendations in the GAO reports, and
are taking action to address them. We agree that:
- we need stricter standards for prompt investigation of serious complaints;
- we need more stringent Federal oversight of State complaint investigations;
- Federal officials must have access to complaint investigation results;
- fines must be more certain and the appeals process must be faster;
- termination of repeat offenders from Medicare and Medicaid must be used more
consistently and effectively;
- States must do a better job of telling us when homes are cited for a deficiency that
contribute to a resident's death; and
- we must develop better management information systems to integrate results of complaint
investigations, track deficiencies, and monitor enforcement actions.
Standards for Prompt Investigation
The GAO found that States categorize serious complaints alleging situations that harm
residents as less than a complaint about immediate jeopardy to residents. The GAO also
found that States do not always investigate these complaints promptly, or at all. Its
report calls for new standards for prompt investigation that include maximum allowable
time frames for investigating serious complaints and for complaints that are deferred
until the next survey schedule.
Therefore, effective immediately, any complaint that alleges actual harm to an
individual in a certified facility must be investigated within 10 working days of its
receipt. We also stressed to States that all complaint data must be entered in a timely
fashion into our On-line Survey, Certification and Reporting data system (OSCAR). We will
develop more standards and long-term improvements as we further analyze complaint
investigation processes. We believe that States have the resources they need to meet these
new standards. If additional resources are needed, however, we will re-examine our
priorities, or the Administration will work with Congress to make sure the funds are there
to do the job right.
Our new Complaint Improvement Project will help us to understand the key elements of
the complaint investigation and resolution process. We believe these key elements include:
- informing consumers of their right to make complaints and how to do so;
- the complaint intake process, including how complaints are received, classified and
scheduled for investigation;
- the investigation process, including the training, knowledge, attitudes, and case load
- the resolution process, for determining whether a complaint is substantiated;
- the administrative hearing process, including back-log of cases;
- the compliance or response process for addressing substantiated complaints, including
the range and actual use of remedies and back-log of actions; and,
- interactions between complaint investigations and licensure and certification systems,
the legal system, and facility-level grievance or continuous quality improvement
Using this analysis, we will develop Federal minimum standards and produce a manual for
States describing each element of a model complaint investigation process, how States
should implement the process, and necessary training and staffing levels.
In addition, we will specify measures we can use to strengthen Federal monitoring and
audits of State performance, including the elements that should be included in a Federal
complaint investigation reporting system and database. And we will explore other changes
needed to strengthen Federal oversight, enhance the responsiveness of the complaint
investigation process, and ensure the welfare of beneficiaries.
Oversight of State Complaint Investigations
We agree with the GAO that investigations need to be watched more closely by the
Federal government, and that States are not sufficiently setting priorities for
investigating complaints. Importantly, as mentioned above, we will now have Regional
Office staff conduct surveys to verify nursing home resident complaints when necessary.
This means that a complaint from a resident now can directly trigger a standard survey by
We are improving Federal oversight of State complaint investigations. We are now
outlining actions we will take when States do not meet their survey responsibilities. We
will specifically evaluate how well States respond to consumer complaints and how promptly
and thoroughly they report investigation results to us to determine whether they meet
their survey responsibilities. And, as part of our Complaint Improvement Project, we will
identify the most effective ways for us to monitor State processing of complaints.
HCFA regional offices are now required to maintain logs of complaint information
reported by the States. If we confirm that these logs are not being maintained, as
reported by the GAO, we will take immediate steps to correct this omission.
As part of the Nursing Home Quality Initiative, we made it clear that States will lose
Federal funding if they fail to adequately protect residents. States must adequately
respond to complaints, or we can and will contract with other entities to conduct surveys
and enforce regulations.
Federal Access to Complaint Investigation Results
The GAO found that States are not reliably reporting results of complaint
investigations to us, and that these findings are therefore not taken into account when
considering other actions. States are currently required to report this information, and
we are taking action to ensure that they comply.
We have directed the States to immediately enter all current and backlogged complaints
into the OSCAR data system regardless of whether the complaint is entered into a State
licensure system. We will closely monitor States to ensure that the information currently
required is actually entered into HCFA's
database. We will include reporting of complaints as a new performance evaluation element
for States. And we will revise the current complaint form so it provides the information
needed to facilitate Federal monitoring of State performance, prioritization, and
Improving Effectiveness of Fines
The GAO found that fines are not always an effective enforcement tool. We agree that
appeals must be processed more quickly so fines can be collected more quickly. Fines need
to be imposed for each instance of a violation. And they need to be imposed for serious
problems even if the problems are quickly corrected.
We support the President's efforts to speed
appeals and collections by the Health and Human Services Departmental Appeals Board, which
operates separately from HCFA. Providers are entitled to a hearing before fines can be
collected. Increased enforcement efforts have resulted in a large number of cases awaiting
appeal hearings. The President's fiscal year
2000 budget proposal would double the number of Administrative Law Judges that can hear
appeals cases in order to speed the appeals process and ensure that fines and other
sanctions are adjudicated in a timely manner.
As announced last July, we have developed a new regulation to enable States to impose
fines for each instance of a violation regardless of the amount of time the facility was
out of compliance with requirements. This regulation was published in the Federal
Register on March 18, 1999, and is effective 60 days after publication. This
additional enforcement option will give States greater flexibility to assess penalties
Strengthening Use of Terminations
Terminating homes from Medicare and Medicaid is an essential last resort enforcement
tool for facilities that fail to correct problems and provide adequate care and safety to
residents. We agree with the GAO, and current policy now requires, that Medicaid payments
to terminated facilities continue for up to 30 days after a facility is terminated if and
only if the home and State Medicaid agency are making reasonable efforts to find another
nursing home for those residents. (Medicare also makes funds available but does not
explicitly require a State's effort to transfer
We will study transfer procedures in the 30 involuntary terminations that took place
last fiscal year. We will explore whether States applied oversight and payment policies
appropriately and consistently, if not why not, and whether facilities closed and
transferred residents, stayed open and paid for care of residents not transferred, were
sold to third parties, etc.
We are concerned, however, that there could be unintended consequences from the GAO's recommendation to use longer "reasonable assurance periods"in all cases before allowing homes that have been
terminated to reenter Medicare. Current guidance to State inspectors includes several
examples to assist in setting reasonable assurance periods, but there must be flexibility
in determining appropriate reasonable assurance periods. Excessive reasonable assurance
periods may not be in the best interest of the nursing home residents, particularly in
regions with limited access to care.
It is important to note that reasonable assurance periods are rarely used. More than 95
percent of nursing homes given initial notice of termination correct problems and remain
open. Last year only 30 of the more than 8300 facilities given initial notice of
termination were in fact terminated. It is also important to note that reasonable
assurance periods apply only under Medicare. The requirement was removed from the Medicaid
statute in 1987. Most nursing homes participate in both Medicare and Medicaid. Therefore,
reasonable assurance periods now can result in a facility being certified for Medicaid but
not for Medicare until a reasonable assurance period is satisfied. We are prepared to work
with Congress to restore reasonable assurance to the Medicaid program so the two programs
We will subject terminated facilities to extra scrutiny and stiffer sanctions for
problems if and when they are allowed to reenter Medicare and Medicaid. Current Federal
regulations allow consideration of a facility's
prior history of noncompliance. However, past problems have not been routinely reviewed
when assessing new sanctions. And previously terminated nursing homes have been able to
re-enter Medicare or Medicaid with a "clean
slate." As such, they have been treated less
aggressively than problem-prone facilities that have not been terminated, and this has
created a perverse advantage to termination that will no longer exist.
We will therefore make explicit in our instructions to States that previously
terminated facilities are automatically subject to immediate sanctions if problems recur.
States and our regional offices track termination information, and we will work to ensure
that this information is used systematically when subsequent enforcement actions are
considered. We will further consider applying this policy to previously terminated homes
that re-enter under new ownership.
Improving the Referral Process
The GAO report cites appalling cases which document our concern that States have not
been consistently referring cases for sanction, even when violations resulted in a
resident's death. We are therefore requiring
States to refer all cases that result in harm to residents. We also now will require
States to report to us when they do not recommend sanctions in cases where regulations
have been violated and a nursing home resident died.
Current guidelines do authorize referral and imposition of fines for egregious
violations, such as those that contribute to a resident's
death, even if the problem has been corrected. Also, as mentioned above, we last week
published a regulation making nursing homes subject to additional penalties or fines for
each specific incident, such as an instance of abuse or neglect, that contributes to a
resident's death. Under this new regulation,
even if the nursing home corrects the violation quickly, it would still face fines when a
resident suffers harm due to a serious violation.
Improving Management Information Systems
We are already undertaking a major redesign of our data systems that will allow us to
integrate results of complaint investigations, track the status and history of
deficiencies, and monitor enforcement actions adequately. We will release software this
summer that will make it easier to track the status and history of deficiencies at the
State level. This software will also automate the current requirement for State collection
of ownership information. We will make further improvements as soon as our Year 2000
computer work allows.
It is important to note that many States investigate complaints for regulations that
exceed Federal requirements and we have no authority to require them to report these data.
As we redesign our management information system we will work to make sure that these data
are fully integrated with other information on facility performance.
HHS INSPECTOR GENERAL FINDINGS
The HHS Inspector General has produced six reports on nursing home enforcement issues
which echo our own concerns and underscore the need for our ongoing efforts to help States
improve enforcement efforts. Many of the Inspector General's recommendations are already incorporated into the
nursing home initiative announced by the President in July 1998, including:
- making surveys more timely and effective;
- changing survey schedules to make surveys more unpredictable;
- increasing the number of night and weekend surveys;
- increasing the number of surveys in facilities with chronic quality of care problems;
- focusing on specific problems such as pressure sores, dehydration, and malnutrition; and
- providing additional training to State surveyors.
We have research underway that will help us respond to the Inspector General
recommendation for staffing standards for registered nurses and certified nurse Assistants
in nursing homes. Last September we awarded a contract to Abt Associates to assist us in a
comprehensive study of nursing home staffing, with results due back to us this fall.
We strongly support the Administration on Aging's
Ombudsman Program, which is absolutely critical in maintaining quality of care in nursing
homes. Ombudsmen make regular visits to nursing homes, act as advocates for residents, and
help in enforcing nursing home standards and ensuring that all nursing home residents are
treated with dignity and compassion. We agree with the Inspector General that this program
should have more visibility, including criteria for frequency and length of regular visits
to facilities. It also needs guidelines for complaint response and resolution times,
further refinements to its data reporting system, and more volunteers.
Though progress has been made in improving the quality of care in nursing homes, we
need to continually build upon it. To this end, HCFA is willing to work with the
Administration on Aging to increase their effectiveness and to facilitate communications
between the Administration on Aging and State survey agencies to better serve nursing home
ENFORCEMENT INITIATIVE PROGRESS
We have made solid progress since the President announced our nursing home enforcement
initiative last July. We have taken several steps to improve inspections by States, who
have the primary responsibility for conducting on-site inspections and recommending
sanctions for care and safety violations. These steps will help ensure faster sanctions
when problems are found, increase oversight for the worst offenders in each State, and
enhance the quality of care by targeting preventable problems.
We have expanded the definition of facilities subject to immediate enforcement action
without an opportunity to correct problems before sanctions are imposed. New guidance to
States will make clear that a facility should automatically get such "grace periods"
only if violations do not cause actual harm to residents and if the facility does not have
a history of recurring problems.
We have identified facilities with the worst compliance records in each State, and each
State has chosen two of these "special focus
facilities" for frequent inspection and intense
monitoring, and monthly status reports. Through closer scrutiny and immediate sanctions,
we will work to prevent "yo-yo"compliance, in which problems are fixed only
temporarily and are cited again in subsequent surveys.
This spring we will implement a wide range of initiatives to detect and prevent bed
sores, dehydration, and malnutrition. We are working with outside experts to develop a
systematic, data driven process to identify problems and provide focus for in-depth
on-site assessments. We will take interim steps this year, and expect to complete the new
system by the end of 2000. We are also working with the American Dietetic Association,
clinicians, consumers and nursing homes to share best practices for preventing these
problems. And we will begin a national campaign to educate consumers and nursing home
staff about the risks of malnutrition and dehydration and nursing home residents' rights to quality care this year.
We will this summer implement a new survey protocol we developed with a national abuse
and neglect forum for evaluating nursing homes'
abuse and neglect prevention processes. We will launch a national consumer education
campaign on preventing and detecting abuse this year.
We will provide training and guidance to States this Spring on enforcement, use of
quality indicators in surveys, medication review during surveys, and prevention of
pressures sores, dehydration, weight loss, and abuse.
We also have:
- made clear that States will lose federal funding if they fail to adequately perform
surveys and protect residents because we can and will contract with other entities, if
necessary, to make sure those functions are performed properly;
- established a new monitoring system for evaluating State survey teams'
adherence to Federally mandated procedures and
- formally reminded States that they must enforce sanctions for serious violations and may
not lift them until an on-site visit verifies that problems are fixed;
- required States to sanction facilities found guilty more than once for violations that
harm residents, with no option to avoid penalties by correcting problems during a grace
- required States to conduct more frequent inspections for nursing homes with repeated
serious violations while not decreasing their inspections for other facilities;
- required States to stagger surveys and conduct a set amount on weekends, early mornings
and evenings, when quality and safety and staffing problems often occur;
- instructed States to look at an entire chain's
performance when serious problems are identified in any facility that is part of a chain,
and begun developing further guidelines for sanctioning facilities within problem chains;
- developed new regulations to enable States to impose civil money penalties for each
serious incident and supplement current rules that link penalties only to the number of
days that a facility was out of compliance with regulations; and
We have taken additional steps to help consumers choose facilities, help facilities
improve care, and help our law enforcement partners prosecute the most egregious cases. We
- created a new Internet site, Nursing Home Compare, at www.medicare.gov, which
allows consumers to compare survey results and safety records when choosing a nursing
home, and which has so far had more than 826,000 page views;
- posted best practice guidelines at cms.hhs.gov/medicaid/siq/siqhmpg.htm on how
to care for residents at risk of weight loss and dehydration;
- begun planning national campaigns to educate residents, families, nursing homes and the
public at large about the risks of malnutrition and dehydration, nursing home residents' rights to quality care, and the prevention of
resident abuse and neglect;
- begun a study on nursing home staffing that will consider the potential costs and
benefits of establishing minimum staffing levels; and
- worked with the Department of Justice to prosecute egregious cases where residents have
been harmed, and to improve referral of egregious cases for potential prosecution.
The Clinton Administration's fiscal year 2000
budget includes proposals to:
- require nursing homes to conduct criminal background checks of prospective employees;
- establish a national registry of nursing-home workers who have abused or neglected
residents or misappropriated residents'
- allow more types of nursing-home workers with proper training to help residents eat and
drink during busy mealtimes.
The cost of background checks and querying the national registry will be financed
through user fees. The Administration will put forward additional proposals as needed for
additional legislative authority to further improve nursing home quality and safety.
We are grateful that Congress provided us with a total fiscal 1999 survey and
certification budget of $171 million for our increased nursing home enforcement efforts,
including $4 million earmarked for the new initiative. We thank you, Mr. Chairman, for
your continued support in meeting the resource needs required by our increased oversight
efforts. We are requesting an additional $60.1 million for fiscal year 2000 to enable us
and other HHS components to fully implement all provisions of the Nursing Home Initiative.
This includes $35 million for HCFA to strengthen State inspection and enforcement efforts,
$15.6 million in mandatory Medicaid money to supplement State inspection and enforcement
efforts, and $9.5 million to ensure adequate resources for timely judicial hearings and
We have made substantial progress in improving protections for vulnerable nursing home
residents. We are doing a better job of making sure nursing homes provide adequate care
and protection. We greatly appreciate the evaluation and advice of the GAO, the HHS
Inspector General, and this Committee in these efforts. Clearly there is much more that we
need to do. The new GAO and HHS Inspector General reports and this hearing will help us
focus on specific areas that we must address. We are committed to continuing our progress
and doing everything we can to ensure that nursing homes comply with care and safety
rules. We look forward to continuing to work with you, the GAO, the HHS Inspector General,
residents, their families, advocates, and providers as we proceed. And I am happy to
answer your questions.