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Sweeping New Rules Govern Long-Term Care

By Alec Dobson

Nursing homes and other long-term care facilities across the country must meet stringent, wide-ranging and costly regulatory requirements in order to participate in Medicare and Medicaid programs, under a new rule issued Tuesday by the U.S. Department of Health and Human Services and its Centers for Medicare and Medicaid Services.

The new regulations will cost each facility, on average, about $63,000 to implement in the first year. They will be phased in over the next three years.

Among the most significant for long-term care operators will be the new regulations regarding staffing and care planning (the new regulations also prohibit pre-dispute arbitration agreements; please see the accompanying Client Alert).


Whether a facility has “sufficient staff” will now depend, in part, on a facility assessment of the competency of the nursing staff.

To determine “competency,” facilities must assess:

  • Their resident population, including census, resident acuity and range of diagnoses; staff competencies required to care for that population; necessary physical environment, equipment and services; and ethnic, cultural or religious factors that might affect care;
  • Their resources, including staff training; equipment; rehab, pharmacy and other services; agreements with third parties to provide services; and
  • A facility-based and community-based risk assessment.

The assessment must be reviewed annually.

These requirements are set forth in 42 C.F.R. §§ 483.35 and 483.70(e).

Care Planning

Facilities will now be required to develop a baseline, interim care plan within 48 hours of the resident’s admission. A comprehensive plan must be developed within 21 days of admission (7 days after the comprehensive assessment, which is due 14 days after admission). The care plan requirements are set forth in a new section of the regulations, 42 C.F.R. § 483.21.

This section also requires adding to the Interdisciplinary Team a nurse aide, a food and nutrition staff member and, to the extent practicable, the resident and his or her representatives. The IDT must document an explanation if it determines that participation of the resident and his or her representatives is not practicable for developing the care plan.

In addition, discharge summaries must include a reconciliation of all discharge medications with the pre-admission medications, as well as a summary of arrangements for follow-up care.

Other Requirements and Revisions

The new rule also:

  • Prohibits facilities from employing people who have had a professional licensure action based on a finding of abuse, neglect, mistreatment of residents or misappropriation of their property, and requires policies and procedures to prevent those problems. (§483.12)
  • Requires documentation of transfers and discharges; notifying the resident and representative, in writing, of the transfer and the reasons for the transfer; and giving the receiving provider or facility specific information such as the reason for transfer. (§483.15)
  • Allows physicians to delegate dietary orders to dieticians and therapy orders to therapists. (§483.30)
  • Adds a new section requiring “necessary” behavioral health care and services and requiring sufficient staff with competencies in providing such care and services, including caring for residents with mental and psychosocial illnesses and implementing non-pharmacological interventions. (§483.40)
  • Requires a pharmacist review of a resident’s medical chart every month. The pharmacist must document and report any irregularities to the attending physician and the facility’s medical director and director of nursing, and the irregularities must be acted upon. The section also includes requirements to reduce the use of psychotropic drugs. (§483.45)
  • Requires sufficient staff with appropriate competencies in food and nutrition services; requires that the dietician or nutritionist hold certain certifications or degrees; requires menus to reflect, with reasonable effort, religious, cultural and ethnic preferences; and allows physicians to delegate prescribing diets to a registered or licensed dietician, to the extent permitted by state law. (§483.60)
  • Adds a new section requiring facilities to have a regulatory compliance and ethics program. (§483.85)
  • Adds a new section detailing the requirements of an effective training program. (§483.95)

History, Timetable and Costs

CMS introduced the proposed rule in 2015 and received almost 1,000 public comments. The agency’s stated goals are to improve the quality of health care and patient safety, while reducing procedural burdens on providers. Other goals include reducing unnecessary hospital admissions, infections associated with health care and use of antipsychotic medications, and improving behavioral health care. The rules for participation in Medicare and Medicaid were first put into effect in 1989, and they have not been comprehensively revised since 1991. Since then, CMS says, populations of long-term care facilities have grown and include more clinically complex conditions, while significant innovations have occurred in resident care.

The various sections of the new regulations will take effect in any of three phases. In some cases, subsections within a section will take effect in different phases. The implementation deadlines for Phases 1-3 are November 28 of 2016, 2017 and 2018, respectively. The specific phases for the various sections and subsections are beyond the scope of this article.

The new regulations will cost providers about $831 million in the first year and $736 million annually in later years, according to CMS’ estimates. The average estimated costs for each facility are about $62,900 in the first year and $55,000 annually for later years. CMS said that it was unable to quantify the benefits of the new regulations, but that they include improving quality, creating “positive business benefits” for facilities, and creating new efficiencies and flexibilities for facilities that are likely to reduce avoidable hospital readmissions. CMS also noted that it spent almost $30 billion for nursing home services in fiscal 2015 and more than $50 billion for other long-term care in fiscal 2013.

Davis & Kuelthau attorneys are available to assist you with compliance with these and other federal and state regulations governing nursing homes and other long-term care providers in Wisconsin. If you have any questions regarding this article, please contact your Davis & Kuelthau attorney or the author, Alec Dobson, at 262.792.2413 /