As the Biden administration continues to aim for transparency in nursing home ownership, most recently through the unveiling of a new database, two members of Congress are trying to go further.
U.S. Representative Jan Schakowsky of Illinois and Representative Mark Takano of California last week introduced the Linking Investors and Nursing Home Quality (LINHQ) Act, a bill that aims to bring “long overdue” transparency to the ownership and financial activity of nursing homes.
Specifically, the legislation would require care homes and equity-holding parties to disclose ownership and financial information annually – up to the 5% ownership level. Those who do not comply would be subject to barred admissions and suspension of federal payments until reporting and quality metrics are met, according to a news release.
Rep. Schakowsky described the role that private equity has played in the retirement home industry as “extremely concerning.”
“The Act Connecting Investors and Quality Nursing Homes will ensure transparency for owners of long-term care facilities, shed light on where taxpayers’ money goes and ensure the protection of residents and workers in homes. care,” she said in a statement. .
The Biden administration has also called out the role of private equity and real estate investment trusts (REITs), going so far as to call the PE a “dangerous model” that has “bought out” struggling retirement homes.
However, while retirement homes can use a variety of debt and equity options, the U.S. Department of Housing and Urban Development (HUD) and local commercial lenders remain the most widely used options for operators. , according to a report compiled by ATI Advisory and commissioned by the National Investment Center for Housing and Aged Care (NIC).
The federal bill would also create a data linkage team within the Centers for Medicare & Medicaid Services (CMS) to identify ownership patterns where facilities are not meeting payroll log (PBJ) levels of 4.1. hours of direct care per resident; fail to comply with reporting requirements; or fail to meet other federal government quality standards.
Along the same lines, the legislation would establish an interagency committee to review ‘low quality’ and non-compliant care homes, and refer them to other government agencies for further investigation, the statement said. .
The agency would also submit a semi-annual report to Congress on its findings.
An analysis of CMS Provider Registration, Chain, and Ownership System (PECOS) data indicates that 348 hospitals and more than 3,000 skilled nursing facilities experienced a change in ownership between 2016 and 2021.
Data shows that 62.3% of purchased NFS have a single organizational owner. Between 2016 and 2021, 3,236 SNFs were sold, or 39.9 per 1,000 SNFs per year.
Not everyone feels these efforts to increase transparency, particularly around ownership, are worth the federal government’s effort.
Calling the exercise a “colossal waste of time”, former CMS administrator Seema Verma says a more holistic approach – rather than the punitive approach taken by the administration – is needed to improve quality in the sector.
“We’re not sitting here trying to figure out who owns home health or who owns dialysis facilities or who owns providers. We kind of do this exercise only in nursing homes because we think it’s going to improve the quality of care,” Verma told Skilled Nursing News in an exclusive interview at the Synergy Summit conference in San Diego.