New Biden Administration rule requires nursing homes to report ownership to Medicare agency
Rule will shine light on private equity ownership of nursing homes, which is associated with higher costs and worse care
Washington, D.C. - Today, U.S. Senator Bob Casey (D-PA), Chairman of the U.S. Senate Special Committee on Aging, applauded the finalization of a new rule by the Centers for Medicare and Medicaid Services (CMS) to increase transparency of nursing home ownership and management. Opaque nursing home ownership structures have often made it difficult to track quality and compliance across nursing homes with the same owner. Several studies and independent investigations have reported private equity ownership is associated with higher costs for patients and the federal government, a reduction in staffing in order to deliver short-term gains, and is potentially an overall detriment to the quality of patient care.
“For far too long, private equity firms have largely been able to avoid scrutiny into their ownership of nursing home facilities, which is associated with raising costs on residents while delivering worse care,” said Chairman Casey. “This final rule from the Biden Administration will allow us to look under the hood of these facilities, giving us the tools we need to better protect nursing home residents and hold negligent or profiteering facility owners accountable.”
The final rule will require nursing homes to share with states and CMS additional ownership and management information. The rule also includes private equity and real estate investment trust definitions, setting the stage for the disclosure of whether nursing home owners are private equity investors or real estate investment trusts. It would require nursing homes enrolled in Medicare or Medicaid to disclose additional information regarding owners, operators, and management; for example, nursing homes would disclose individuals or entities that provide administrative services or clinical consulting services.
Senator Casey has spent his career fighting to improve the safety of nursing homes for their residents. In 2009, Senator Casey cosponsored bipartisan legislation that proposed policies around nursing home ownership transparency, which was included in the Affordable Care Act, and is reflected in the new rule from CMS. In February of this year, he called on the Biden Administration to implement minimum staffing standards in nursing homes and applauded the announcement of the new rule in September. Last week, he encouraged CMS to swiftly implement the new staffing requirements. This summer, he also called on CMS to improve oversight of nursing homes, after releasing a report which detailed a crisis of underfunding and understaffing at nursing home survey agencies in states around the country.