Deadlines are looming to come into compliance with sweeping changes to the Centers for Medicare & Medicaid Services (CMS) requirements for long-term care facilities (LTC) participating in Medicare and Medicaid. The CMS final rule was published in the Federal Register on Oct. 4, 2016. This is the first set of comprehensive revisions to the participation requirements in 25 years.

CMS reviewed the prior versions of the regulations with the goal of improving safety, quality of life, care and services, as well as to align the rule with current professional standards. The rule finalizes regulations that were proposed on July 16, 2015 (80 Fed. Reg. 42168), for which CMS received more than 9,800 comments. The regulations are effective on Nov. 28, 2016, but various portions of the requirements will be implemented in phases.

The new regulations are lengthy and detailed, and operators of LTC facilities must review them closely. Ten aspects of the rule may require significant compliance changes for LTC operators:

1. LTC Facilities Must Develop a Compliance and Ethics Program

Although many LTC facilities have implemented compliance programs based on prior Department of Health and Human Services (HHS) Office of Inspector General guidance, the operating organization for each LTC facility must make sure it has developed a compliance and ethics program by Nov. 28, 2017. The "operating organization" is defined as the "individual(s) or entity that operates a facility." The new rule defines a "compliance and ethics program" as "a program of the operating organization" that is "reasonably designed, implemented, and enforced so that it is likely to be effective in preventing and detecting criminal, civil, and administrative violations" under the Social Security Act (Act) and in promoting quality of care.

A long-term care compliance and ethics program must include certain required components. At a minimum, all programs must include the following:

  • Written policies, procedures and standards dealing with compliance and ethics. These must be reasonably capable of reducing the prospect of administrative, civil and criminal violations under the Act. They must promote quality of care. There must be a mechanism to report suspected violations, as well as an alternate method of reporting violations without fear of retribution. The program must include disciplinary standards that specify the consequences for violations that apply to the operating organization's entire staff, as well as contractors. Even volunteers must be subject to disciplinary standards, "consistent with the volunteers' expected roles."
  • The compliance program must assign specific individuals within the operating organization's high-level personnel to oversee compliance. "High-level personnel" are defined as "individual(s) who have substantial control over the operating organization or who have a substantial role in the making of policy within the operating organization." These personnel may include, but are not limited to, the chief executive officer, members of the board of directors or directors of major divisions in the operating organization.
  • The high-level personnel assigned to oversee compliance must be provided with sufficient resources and authority to reasonably assure compliance with the program's standards, policies and procedures.
  • Operating organizations with five or more facilities must have a designated compliance officer who reports to the board and is not subordinate to the general counsel, chief financial officer or chief operating officer.
  • The organization must use due care to avoid delegating substantial discretion to individuals that the operating organization knew or should have known had the propensity to engage in criminal, civil and administrative violations under the Act.
  • Organizations must have a training program regarding compliance. Each facility must take steps to communicate the policies, procedures and standards of the compliance and ethics program. This may include mandatory training or orientation programs, or disseminating information that explains what is required under the program. Contractors and volunteers also must receive this information, consistent with their expected roles.

2. New Physical Plant Requirements

The regulations include requirements for the physical building where LTC services are provided. For facilities that are newly constructed, reconstructed or newly certified after Nov. 28, 2016, rooms with more than three residents are prohibited. At a minimum, all rooms must have a sink and commode. Existing facilities not meeting these requirements are grandfathered into compliance. It is important to note that, in a change of ownership, if the new owner does not accept the prior owner's Medicare provider agreement, the facility would be newly certified and would have to meet the new physical plant requirements.

3. Person-Centered Care Is a Key Principle of the Requirements

The rule reflects a focus on person-centered care, which was "one over-arching principle" of the proposed rule. Facilities must accomplish this by developing internal guidelines promoting resident choice. CMS plans to publish interpretive guidance for this requirement that outlines best practices. While it supports the development of homelike environments in LTC facilities, CMS said it recognizes that "they are not directly comparable to private residences."

CMS has implemented a number of measures to promote resident autonomy and choice. For example, the resident must have the right to choose his or her schedule and activities. CMS has stated that it will issue interpretive guidance to provide more information regarding how the facility can meet this requirement. Residents are allowed to use personal belongings to the extent possible. The final rule requires the facility to use reasonable care to protect the resident's property from loss or theft. Facilities must provide a resident with a special diet if the special diet is in the resident's plan of care.

4. Changes in Certain Staffing Requirements

The rule allows for greater flexibility in providing care through advanced registered nurse practitioners (ARNPs) and therapists, although all resident care must be supervised by a physician. CMS made accommodation for LTC providers that expressed concerns about staffing, particularly with respect to the proposed requirement that physicians review all residents prior to non-emergency hospital transfers. This proposal was not adopted. CMS noted, however, that while it sympathizes with rural facilities that do not have access to a large labor pool, CMS "cannot condone substandard care." CMS has declined to establish minimum staffing ratios at this time, despite calls for requiring around-the-clock services of a registered nurse.

CMS recognizes that infection control in LTC facilities is very important, and the rule contains specific provisions on this topic. For example, individuals should be designated to be responsible for the facilities infection prevention and control program.

5. Social Media Requires Ongoing Attention

CMS agrees that abuse could take place through the use of technology, including social media. In the preamble to the final rule, CMS stated that it will issue interpretive guidance that will provide further clarification. On Aug. 5, 2016, CMS issued a memorandum to state survey agency directors making it clear that taking photographs of a resident or the resident's private space without written consent is a violation of the resident's right to privacy. Additionally, use of a photograph or recording of a resident in a manner that is demeaning or humiliating constitutes abuse, regardless of whether the resident provided consent.

6. Pre-Dispute Arbitration Agreements Are Prohibited

In its proposed rule, CMS included a number of specific parameters regarding arbitration agreements, including a requirement that the agreement be explained to the resident and a prohibition stating that the agreement cannot be contained within any other agreement or paperwork. In the final rule, CMS prohibits all pre-dispute arbitration provisions and includes procedural requirements if a resident is asked to sign an arbitration agreement after a dispute has arisen. CMS received a number of comments in response to the proposal regarding arbitration agreements, including a letter signed by 34 senators urging CMS to ban these types of clauses. Another letter signed by 16 state attorneys-general argued that these types of agreements were harmful and should be prohibited. According to CMS, the new ban will "have no legal effect on the enforceability of existing pre-dispute arbitration agreements between LTC facilities and patients, and therefore, we believe that the terms of the [Federal Arbitration Act] are not implicated." The preamble to the rule also states that "the Secretary, in this final rule, is acting well within her statutory authority, particularly given the concerns raised by commenters over the unfairness of pre-dispute arbitration and the harm these agreements cause LTC facility residents."

7. Privacy Policies and Resident Rights May Require Updating

The rule will require many LTC facilities to change their resident privacy policies and documentation of resident rights. For example, LTC facility residents have the right to privacy, not only with respect to their healthcare but to their personal electronic communication. They have the right to privacy in the use of email and video communication and internet research. A resident's internet research must be legal, however, and a resident's use of video communications must not infringe on another resident's rights.

8. Revised Nutrition Provisions

The rule changes contain specific provisions regarding nutrition. Attending physicians must prescribe a therapeutic diet. Because physicians typically spend only a limited amount of time in a LTC facility, CMS has added flexibility to the regulations by allowing the attending physician to delegate the task of writing dietary orders to a dietitian or other qualified nutrition professional. A resident's request to eat outside of a normal mealtime does not have to be documented in the plan of care, but the provision of snacks and meals must be consistent with the plan of care. LTC facilities must consider a resident's religious, cultural and ethnic needs, as well as input from residents, when developing menus, but LTC facilities are not required to "be able to provide every possible religious, cultural, or ethnic diet."

9. Revised Patient Care Requirements

Because facilities are required to have a registered nurse available at least eight hours per day, seven days per week, CMS expects the facility to be able to formulate a baseline care plan for a resident within 48 hours of admission. The care plan must also be implemented.

CMS has added respiratory therapy to the list of specialized rehabilitation services that must be available when necessary. Although CMS originally proposed that the therapist be certified by Medicare or Medicaid, after reviewing comments on that requirement, CMS withdrew that proposal, and the regulations now state that the provider may not be excluded from any federally funded healthcare program.

CMS also withdrew a proposal to impose specific standards on therapy services provided by LTC facilities to outpatients. CMS stated that further study and consideration of this issue is needed.

10. LTC Facilities Must Conduct Annual Assessments and Implement QAPI Programs

Each year, a LTC facility must conduct an assessment of a number of factors relating to its operation and resident care. This assessment must address the care required by the LTC facility's residents; the skills needed by staff; the necessary physical environment and equipment; cultural, ethnic and religious factors; the facility's resources and equipment; specific services provided; personnel and their education and training; contracts for services; and health information technology resources.

LTC facilities must develop, implement and maintain a comprehensive and effective Quality Assurance and Performance Improvement (QAPI) program, which must monitor and evaluate all programs and services of the LTC facility. Facilities have flexibility to determine which areas will take priority.

Next Steps

LTC facilities must take steps right away to make sure they can comply with the requirements by the various applicable deadlines. A detailed crosswalk table that highlights which existing provisions have been moved or revised is available at 81 Federal Register 68825-68831. "Phase 1" has a very close implementation date: Nov. 28, 2016. Phase 2 must be implemented within a year from that date, and Phase 3 by Nov. 28, 2019.

Ensuring compliance with the revisions will require concerted effort on the part of all LTC facilities participating in Medicare and Medicaid. CMS believes these efforts and costs will lead to reduced hospitalizations, an increased rate of quality improvement and other business benefits.