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Former CMS Chief Seema Verma Blasts Nursing Home Reform Proposals

By Jordyn Reiland | March 14, 2022

The former head of the Centers for Medicare & Medicaid Services this week expressed disappointment in the Biden administration’s nursing home policy proposals, calling the measures “short-sighted” and “outdated policy prescriptions.”

In an op-ed published Monday in Modern Healthcare, Seema Verma called on the White House to instead take a more results-oriented approach instead of what she perceives as “government micromanagement.”

“There is broad agreement that many of America’s nursing homes must make significant improvements to deliver the care that patients deserve,” she wrote. “A modern, results-oriented approach that focuses on outcomes has a better chance of improving quality than the president’s outdated policy prescriptions.”

Verma served as the leader of CMS from 2017 to 2021.

Her comments come just two weeks after the White House unveiled its nursing home reform proposal, which zeroed in on setting minimum staffing requirements and took aim at private equity ownership, among several other priorities in its plan.

Verma specifically took issue with the administration’s plans to impose federal staffing requirements on nursing homes, arguing doing so could “decimate an industry that has already been ravaged by the pandemic.”

“A one-size-fits-all staffing ratio concocted by federal bureaucrats won’t consider differences in a patient’s acuity or local factors, but it will thwart innovation in operational and technological advances that can improve care with existing workforce numbers,” Verma wrote.

Nursing homes have lost nearly 238,000 nursing home employees – amounting to 15 percent of its total workforce – since the start of the COVID-19 pandemic, according to Bureau of Labor Statistics data.

CMS said during its nursing home stakeholder call late last week that it would propose a new minimum staffing standard within one year.

Verma also pointed to Biden’s laser focus on private equity (PE) investment in nursing homes, arguing that the administration cherry-picked data to justify its approach.

Among the White House’s referenced studies tying private equity to poor care quality, Verma said the federal government failed to mention one published in October 2020 that found SNFS owned by PE firms had COVID-19 outcomes comparable to facilities with other ownership structures, including similar staffing levels, case counts, and COVID-19 deaths — as well as deaths from any cause.

The study examined 11,470 nursing homes in the U.S. to determine whether nursing homes with PE ownership performed better or worse during the pandemic, compared with other facilities.

“The president is using the nursing home crisis to unleash federal investigators on facilities owned by private equity investors who help fund groundbreaking innovation across the healthcare industry,” Verma wrote. “Their investments may one day lead to improving the quality of care in nursing homes.”

Private equity ownership of nursing homes is not substantial. Of the roughly 15,000 nursing homes in the country, an estimated 5% are owned by private equity firms, according to an October 2020 JAMA Network Open study.

Nursing home industry leaders have already objected to several elements of the proposal. The attacks on private equity ownership are drawing pushback, and a call for CMS to set nationwide minimum staffing requirements is being roundly criticized by voices in the industry.

Verma said the solution lies in a move by state and federal governments toward a value-based payment system that rewards higher quality and better outcomes.

She also touted the impact telehealth has had on the industry following its expanded uses due to the pandemic, arguing that policies need to be revised to ensure SNFs are properly reimbursed.

“Today, a five-star and a one-star facility get paid at the same rate. If reimbursement is tied to performance, nursing homes have no choice but to make investments in quality,” she wrote.

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