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Trump Administration Relaxes Financial Penalties Against Nursing Homes

The Trump administration 鈥 reversing guidelines put in place under President Barack Obama 鈥斅爄s scaling back the use of fines against nursing homes that harm residents or place them in grave risk of injury.

The shift in the Medicare program鈥檚 penalty protocols was requested by the nursing home industry. The American Health Care Association, the industry鈥檚 main trade group, has complained that under Obama inspectors focused excessively on catching wrongdoing rather than helping nursing homes improve.

鈥淚t is critical that we have relief,鈥 Mark Parkinson, the group鈥檚 president, wrote in a letter to then-President-elect Donald Trump in December 2016.

Since 2013, nearly 6,500 nursing homes 鈥 4 of every 10 鈥 have been cited at least once for a serious violation, federal records show. Medicare has fined two-thirds of those homes. Common citations include failing to protect residents from avoidable accidents, neglect, mistreatment and bedsores.

The new guidelines discourage regulators from levying fines in some situations, even when they have resulted in a resident鈥檚 death. The guidelines will also probably result in lower fines for many facilities.

The change in policy aligns with Trump鈥檚 promise to reduce bureaucracy, regulation and government intervention in business.

Dr. Kate Goodrich, director of clinical standards and quality at the Centers for Medicare & Medicaid Services (CMS), said in a statement that unnecessary regulation was the main concern that health care providers raised with officials.

鈥淩ather than spending quality time with their patients, the providers are spending time complying with regulations that get in the way of caring for their patients and doesn鈥檛 increase the quality of care they provide,鈥 Goodrich said.

But advocates for nursing-home residents say the revised penalties are weakening a valuable patient-safety tool.

鈥淭hey鈥檝e pretty much emasculated enforcement, which was already weak,鈥 said Toby Edelman, a senior attorney at the Center for Medicare Advocacy.

Medicare has different ways of applying penalties. It can impose a specific fine for a particular violation. It can assess a fine for each day that a nursing home was in violation. Or it can deny payments for new admissions.

The average fine in recent years has been $33,453, but 531 nursing homes amassed combined federal fines above $100,000, records show. In 2016, Congress to factor in several years of inflation that had not been accounted for previously.

The new rules have been instituted gradually throughout the year.

In October, its regional offices from levying fines, even in the most serious health violations, if the error was a 鈥渙ne-time mistake.鈥 The centers said that intentional disregard for residents鈥 health and safety or systemic errors should still merit fines.

A from CMS discouraged the directors of state agencies that survey nursing homes from issuing daily fines for violations that began before an inspection, favoring one-time fines instead. Daily fines remain the recommended approach for major violations discovered during an inspection.

Dr. David Gifford, the American Health Care Association鈥檚 senior vice president for quality, said daily fines were intended to prompt quick remedies but were pointless when applied to past errors that had already been fixed by the time inspectors discovered them.

鈥淲hat was happening is you were seeing massive fines accumulating because they were applying them on a per-day basis retrospectively,鈥 Gifford said.

But the change means that some nursing homes could be sheltered from fines above the maximum per-instance fine of $20,965, even for egregious mistakes.

In September 2016, for instance, health inspectors , a nursing home in Decatur, Ill., for failing to monitor and treat the wound of a patient whose implanted pain-medication pump gradually slipped over eight days through a ruptured suture and protruded from her abdomen. The patient died.

CMS fined Lincoln Manor $282,954, including $10,091 a day for 28 days, from the time the nursing home noticed the problem with the wound until supervisors had retrained nurses to avoid similar errors. An administrative law judge called the penalties 鈥渜uite modest鈥 given the 鈥渁ppalling鈥 care.

The fines were issued before the new guidelines took effect; if the agency had issued a one-time fine, the maximum would have been less than $21,000.

Lincoln Manor closed in September. Its owner could not be reached for comment, and his lawyer did not respond to an interview request.

Advocates for nursing home residents say that relaxing penalties threatens to undo progress at deterring wrongdoing. Janet Wells, a consultant for California Advocates for Nursing Home Reform, said the changes come as 鈥渟ome egregious violations and injuries to residents are being penalized 鈥 finally 鈥 at a level that gets the industry鈥檚 attention and isn鈥檛 just the cost of doing business.鈥

In November, the Trump administration exempted nursing homes that violate from penalties for 18 months. Homes must still follow the rules, which are intended, among other things, to reduce the overuse of psychotropic drugs and to ensure that every home has adequate resources to assist residents with major psychological problems.

Rodney Whitlock, a health policy consultant and former Republican Senate staffer, said health inspectors 鈥渁re out there looking for opportunities to show that the nursing homes are not living up to some extremely tight standards.鈥 He said while the motivation for tough regulation was understandable, 鈥渢he fines don鈥檛 make it easier to hire people and doesn鈥檛 make it easier to stay in business.鈥

In June, CMS rescinded another Obama administration action that banned nursing homes from pre-emptively requiring residents to submit to arbitration to settle disputes rather than going to court.

鈥淲e publish nearly 11,000 pages of regulation every year,鈥 the agency鈥檚 administrator, Seema Verma, said in . That paperwork is 鈥渢aking doctors away from what matters most: patients.鈥

Janine Finck-Boyle, director of health regulations and policy at LeadingAge, a group of nonprofit nursing homes and other entities that care for older people, said the group鈥檚 members had been struggling to cope with regulations.

鈥淚f you鈥檙e a 50-bed rural facility out West or in the Dakotas,鈥 she said, 鈥測ou don鈥檛 have the resources to get everything done from A to Z.鈥

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