OIG Issues Supplemental Compliance Program Guidance For Nursing Facilities: Quality Of Care Is Top Risk Area

On September 30, 2008, the United States Department of Health

and Human Services (HHS) Office of Inspector General (OIG)

published OIG Supplemental Compliance Program Guidance for

Nursing Facilities.1 With quality of care the first

risk area identified, the supplemental guidance is part of a series

of recent government efforts focused on improving quality of care

at skilled nursing and long-term care facilities. The OIG also

released a September 18, 2008 report, Trends in Nursing Home

Deficiencies and Complaints, which revealed that, between 2005

and 2007, over 90 percent if nursing homes were cited for

deficiencies in quality of care, resident assessment, and quality

of life. On April 24, 2008, the Centers for Medicare and Medicaid

Services (CMS) began identifying the poorest performing nursing

facilities nationwide, dubbed Special Focus Facilities, on its

Nursing Home Compare Web site.2 The supplemental

guidance also follows the joint OIG-Health Care Compliance

Association (HCCA) roundtable report, Driving for Quality in

Long-Term Care: A Board of Directors Dashboard, released

January 31, 2008.3

Background

The OIG first published a compliance program guidance for

nursing facilities on March 16, 2000.4 The original

guidance addressed the fundamentals of establishing an effective

compliance program in the nursing industry. Since the publication

of the original guidance, there have been significant changes in

the way nursing facilities deliver, and are reimbursed for, health

care services. Although the original guidance included quality of

care as a risk area, recent changes to the regulatory enforcement

environment and increased concern on quality of care in nursing

facilities prompted a greater emphasis on quality in the

supplemental guidance.

The guidance contains new compliance recommendations and an

expanded discussion of risk areas. When drafting the supplemental

guidance, the OIG considered "Medicare and Medicaid nursing

facility payment systems and regulations, evolving industry

practices, current enforcement priorities (including the

Government's heightened focus on quality of care), and lessons

learned in the area of nursing facility

compliance."5 The supplemental guidance provides

"voluntary guidelines to assist nursing facilities in

identifying significant risk areas and in evaluating and, as

necessary, refining ongoing compliance

efforts."6

Because the guidance supplements, rather than replaces, the

original guidance, the two documents "collectively offer a set

of guidelines that nursing facilities should consider when

developing and implementing a new compliance program or evaluating

an existing one."7

The supplemental guidance is partitioned into five sections. The

first two offer a background overview of the compliance program

guidance process and the Medicare/Medicaid reimbursement system.

The third section covers several fraud and abuse risk areas

relevant to nursing facilities. In the fourth section, the OIG

offers recommendations for establishing an ethical culture and

assessing and improving existing compliance programs. The fifth

section addresses self-reporting and lists steps a nursing facility

should take if it discovers credible evidence of misconduct.

Fraud and Abuse Risk Areas

By identifying current, relevant risk areas, the supplemental

guidance should assist nursing facilities in their efforts to

"identify operational areas that present potential liability

risks under several key Federal fraud and abuse statutes and

regulations."8 The OIG stresses each facility

should carefully examine these risk areas and identify those that

potentially affect it.

1. Quality of Care

   Although it is a priority for nursing facilities, a significant

   number fail to deliver quality health care. Whether this failure is

   the result of inadequate staffing, insufficient training and

   education, or lack of oversight, the result is often the same:

   residents risk harm. In cases where the care failure is systemic

   and widespread, a facility may be liable for submitting false

   claims for reimbursement under the False Claims Act, the Civil

   Monetary Penalties Law, a variety of additional federal authorities

   that address false and fraudulent claims or statements made to the

   government, and similar state laws, including criminal, civil, and

   administrative sanctions.9 As a starting point on

   quality of care issues, facilities should familiarize themselves

   with the principal nursing facility Medicare Conditions of

   Participation.10 The OIG states "it is essential

   that key members of the organization understand these requirements

   and support their facility's commitment to compliance with

   these regulations."11 The five sub-areas on quality

   of care identified in the supplemental guidance are addressed

   below.

   Sufficient staffing: A critical factor in

   quality care is to provide enough trained, competent staff to care

   for residents. Federal law requires a facility provide sufficient

   staffing necessary to attain or maintain the highest practicable

   physical, mental, and psychosocial well-being of its

   residents.12 Many state laws, including California,

   require specific, higher nursing staff ratios. The OIG strongly

   encourages facilities assess their staffing patterns regularly to

   evaluate staff skill levels, resident case-mix, staff-to-resident

   ratios, staff turnover, staffing schedules, disciplinary records,

   payroll, timesheets, adverse event reports, interviews, and

   resident and family feedback.13

   Comprehensive resident care plans: Medicare

   and Medicaid regulations require facilities develop a comprehensive

   care plan for each resident.14 The OIG states that a

   comprehensive care plan is "essential to reducing

   risk."15 Facilities should ensure that care

   planning includes all disciplines involved in the resident's

   care, designing an interdisciplinary and comprehensive approach to

   developing care plans.16 The attending physician should

   participate in the development of the care plan and facilities

   should ensure the physician actually supervises each resident's

   care.17

   Medication management: Facilities must provide

   pharmaceutical services to meet the needs of each resident and

   should be mindful of potential quality of care problems when

   implementing policies and procedures on proper medication

   management.18 Facilities can reduce risk by educating

   staff on medication management and improper pharmacy kickbacks for

   consultant pharmacists. Facilities should review the total

   compensation paid to consultant pharmacists to ensure it is not

   structured in a way that reflects the volume or value of particular

   drugs prescribed or administered to residents.

   Appropriate use of psychotropic medications:

   The OIG identified this risk area as a violation of the prohibition

   against inappropriate use of chemical restraints19 and a

   violation of the requirement to avoid unnecessary drug

   usage.20 Facilities should ensure there is adequate

   indication for the use of medications and should carefully monitor,

   document, and review resident use of psychotropic drugs. Educating

   caregivers and auditing drug regimen reviews is an important part

   of reducing risk in this area.21

   Resident safety: The OIG suggests several

   steps facilities may take to protect residents from abuse and

   neglect, a right protected by federal (and often state)

   law.22 Facilities can promote resident safety through

   internal, confidential reporting systems, hotlines, posters, and by

   communicating a clear commitment to protecting from retaliation

   those people who make reports. Because residents also suffer harm

   at the hands of other residents, a heightened awareness and

   monitoring of resident interaction is crucial. Facilities should

   perform comprehensive staff screening for criminal records,

   exclusions, and other information on staff both prior to employment

   and periodically for current staff.

2. Submission of Accurate Claims

   Accurate claim submission is another risk area identified in the

   supplemental guidance. The OIG identified four sub-areas, each of

   which is...