Former Rockport CEO: If Nursing Homes and Investors Don’t Embrace Reform, Industry Will Be ‘Run Over’

The exact prescription for reforming the nursing home landscape depends largely on who you ask. An executive in the space could give you a wildly different answer than a geriatrician, and both may not agree with the perspective of federal regulators.

But Dr. Michael Wasserman has held roles across all those domains, and he has a clear vision for the future — one that rests on fundamental changes to how the industry operates, from the building level to the real estate investment that underpins its overall finances.

Formerly the CEO of major California nursing home operator Rockport Healthcare Services, Wasserman now serves as president of the California Association of Long-Term Care Medicine, a group that represents physicians who specialize in senior care; his long career in the space also included a stint as the executive director of a Quality Innovation Network-Quality Improvement Organization (QIN-QIO) contractor for the federal government, overseeing efforts to bolster nursing home care for Medicare beneficiaries.

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Wasserman joined SNN by phone on July 8 to discuss his outlook for both the short-term COVID-19 challenges still plaguing nursing homes, as well as his vision for the future changes that operators must make.

Given the scope of the pandemic’s impact on nursing home residents, the veteran geriatrician put the stakes in stark terms: Either the industry comes up with comprehensive reform solutions and a plan to implement them, or the changes will be out of their hands.

“This is one of those pivotal moments — as you said, an inflection point — where the industry as a business needs to decide: Do we want to own this and all work together to improve care? Or do we want the government to change the way we function?” Wasserman said.

What are the top concerns that you see right now as you look out across the post-acute and long-term care landscape?

I think it was George Santayana who said: Those who ignore history are destined to repeat it. I think there were a lot of potential lessons learned in the first three to four months of this pandemic, and my great fear right now is — as we’re seeing hotspots erupt, as we’re seeing new spots actually gain point prevalence and traction — I am concerned that we didn’t learn the lessons.

My number-one concern right now, as we see the overall numbers rising, especially among younger people, is those cases are going to re-infiltrate nursing homes, assisted living, group homes, CCRCs, retirement communities — or infiltrate the ones that didn’t get hit the first time around. So I think that is my number-one fear right now.

What’s the impact of that on visitation? What’s realistic, and are we anywhere near a point where it could resume, safely, in the same form as before the pandemic?

It is actually the question of the moment. For the first few months, most of us in geriatrics and long-term care medicine were just running around trying to educate folks on the dangers — the need for PPE, the need for testing, the need for infection prevention.

In the last month, I have actually shifted my focus to: How do we go back to our core principles of delivering person-centered care? I’d like to frame this from the perspective that in my opinion, the government at all levels — and even the industry at some levels — really didn’t focus on core science principles during the first three to four months; they were very reactive.

Suddenly you see from CMS, and you see from state governments: We’ve got to protect these core nursing home residents and assisted living residents. And what is their solution? To imprison them. Literally, the term from an ethical perspective is infantilize. So the government is saying: We’re going to basically protect nursing home and assisted living residents by keeping them in, keeping people out — essentially imprisoning them, which as a geriatrician goes against every fiber of my person-centered being.

So here’s the problem. I think the government was basically slow to react, and didn’t react efficiently and appropriately. Their reaction now is to be reactive, and to just put a literal wall around facilities, rather than asking the question of: What do we need to do to allow vulnerable older adults to actually have a life during COVID?

Instead of taking what I consider the very lazy approach of just looking at how we can lock up older adults — because those of us in geriatrics and long-term care medicine know the dangers of social isolation and deconditioning and all of that — what we need to do is we need to be thinking critically. We need critical thinking skills to inform us on how to effectively allow vulnerable older adults in congregate living settings to have a life during COVID.

To that extent, the California Association of Long-Term Care Medicine has convened what we call a Delphi group — we actually did the same regarding testing, because testing wasn’t happening around the country. We put together an expert group and we published a paper, literally the first week of June, on the need for widespread testing in nursing homes and assisted living facilities of the staff, which has gained traction now.

We have put together a similar group to develop expert-driven recommendations on what it will take to allow visitation. This is really driven by experts who understand this population, understand the environments they live in, and are dedicated to person-centered care. But we also understand the science that exists as of today as it relates to COVID.

So I think some of the core things around opening up for visitation are the core principles that we also developed back in April: We need abundant PPE. If assisted living facilities and nursing homes don’t have personal protective equipment, it’s game over.

But if you do have it, why can’t you use it for visitors? Why can’t the ombudsmen use them? Why can’t family use them? Why can’t other people who are essential to the lives of vulnerable older adults, why can’t they use PPE?

And then you have testing which, again, there are some logistical issues still going on. But if we have testing, especially point-of-care testing, you should be able to test visitors and individuals.

I think from a science perspective, there’s a lot we should be able to do to allow for visitation. But I really have been disappointed in both the government and the industry’s response to this problem; they really haven’t engaged the experts in geriatrics and long-term care medicine to try to come up with true science-based, expert-driven, person-centered approaches to these problems.

I think that hits at the transition we’re seeing now in some areas, from COVID being an immediate problem that requires drastic solutions to a chronic issue that will plague the industry indefinitely — sort of like how HIV went from being a death sentence to a disease that can be managed with the right tools and knowledge, but isn’t this opaque emergency.

You actually give me goosebumps. I was literally on the front lines as an intern in 1985 at Cedars-Sinai Hospital when HIV first came of age, and it was a death sentence then. I have seen it evolve, and I think you’re right — you know, the first couple weeks of March, my colleagues and I knew exactly what was coming.

We were trying to inform policymakers and the industry of what was coming, and there was tremendous resistance because this is a virus; it’s not for folks with operational expertise or health care policy expertise. It’s the kind of virus that affects the population [for which] there is a clinical discipline, called geriatric medicine, that informs myself and my colleagues — not only physicians, but pharmacists and nurses and social workers — about the multitude of effects that this virus causes.

Putting it in the perspective of chronic illness is spot-on. … This is an interdisciplinary team-based problem that requires a team, that requires leadership that no single discipline or individual is going to be able to address.

This is the crux of the problem with the industry, both nursing homes and assisted living, that are heavily weighted from an administrative leadership perspective to a single, non-clinical administrator. And that just doesn’t work with this virus. This virus requires integration of clinical experts into operations, policymaking — not only at the facility operation level but at the government level of making policy and regulations.

That’s where we’ve seen so many mistakes, all the way from Gov. Cuomo’s mistake; Gov. Newsom tried to make a similar mistake. This is not a partisan virus. This virus is completely non-partisan; it doesn’t care whether you’re a Republican or Democrat or libertarian. From what I’ve seen throughout the country, the mistakes have not been partisan. There’s plenty of mistakes to go around at all levels, based primarily, in my opinion, on not engaging the clinical experts in geriatrics and long-term care medicine.

At the beginning, on March 10, I was quoted in NBC News that this would be the worst thing to hit nursing homes in my lifetime — and by the way, that wasn’t just me. I was reflecting on all of my colleagues who had been calling in the early days of March, saying, “Mike, can you help? Can you get the word out? We’re on the front lines. We’re busy. We’re trying to deal with this. Can you help us message this?”

I actually struggle because I see a lot of stuff today: “We didn’t know. This was a surprise.” It was not a surprise to the experts in geriatrics and long-term care medicine, and that frustrates me.

And what really frustrates me is: Those same words of “this was a surprise” are coinciding with what looks like the same mistakes that are about to be made again. And that’s what really concerns me, that we have an opportunity to learn from the last four months. If we don’t take that opportunity, we’re going to lose more people unnecessarily.

What’s your opinion on the future areas for reform and regulatory changes? Resident advocates have argued that fines for infection control aren’t high enough; nursing home operators already believe they’re generally over-regulated. There’s also an argument to be made that nursing homes are overly risk-averse, and that paralyzed a lot of leaders during those crucial early days, and prevented them from taking the drastic steps that were necessary for safety.

I believe that it’s time for a paradigm shift. We’ve needed this; we’ve seen it coming. When I trained 35 years ago, people were in the hospital for six weeks and then they went home. Now they go into the hospital for three days, and they go to a SNF.

Thirty years ago, they were seen daily by a doctor; they had 24/7 nursing. But we send them to a nursing home and we expect hospital-level care with a fraction of the resources, and that model just doesn’t work.

I think this is an opportunity for a paradigm shift, and I think that paradigm shift is going to come in a few different areas. Number one: how nursing homes function. We literally just published today an article in the Journal of Nursing Home Research on an aspirational model for nursing homes around COVID-19.

What that model really speaks to is what I talked about before — integrating the clinical leadership. A nursing home won’t look like an administrator running everything; it’ll actually be a team of the administrator, the director of nursing, the medical director, the director of staff development, and they will really have to incorporate systems that effectively work around the complex clinical nature of a very complex population.

The irony is I am not a fan of regulation. I actually don’t think regulation is the way out of this. We’ve actually developed a third Delphi group that is looking to inform whomever will listen on an improved approach to the survey process.

I actually look to QAPI [quality assurance and performance improvement], believe it or not. I ran the nursing home QIO in California for a while, and we trained facilities in QAPI. But I will tell you, most facilities give lip service to QAPI.

And it’s a shame, because if they embraced QAPI for what its core principles are, and they actually used it for what it can be, QAPI is the way to develop effective systems — and then surveyors can focus on QAPI, and look to how facilities are improving their systems and quality around a QAPI approach, rather than using an antiquated, punitive, not-supported-by-the-literature approach of just fining and checking off boxes.

Number one is the leadership team and engaging clinical leadership and medical directors and other clinicians. Number two is really embracing QAPI and using that to change the regulatory approach.

The third is something that I’ve been trying to message — I shared it during an assembly hearing in California a month ago — and that is how real estate fits into this industry. Honestly, I’ve been very frustrated because the owners of the real estate of nursing homes and assisted living throughout the country could easily leverage their collective assets to provide abundant PPE and testing without blinking an eye at incredibly low, if not negligible, interest rates right now — and they haven’t done so.

And why haven’t they? Because it’s just the real estate; they have no business obligation to do that. I would argue they have a moral obligation, because the assets of the nursing home and assisted living industry, the financial strength of this industry, is in the real estate. The operators don’t have those sorts of assets to call upon, to leverage, to use for the PPE and the testing.

But the real estate owners do, and I think one of two things is going to have to happen: Either the folks behind the real estate need to suck it up and engage, or the government’s going to have to change the way nursing homes are owned and operated — and I don’t want to see that. I’m a capitalist. I’m an entrepreneur by nature and at heart.

But when other entrepreneurs don’t take some degree of social responsibility, I think in many ways, that today’s nursing home real estate owners are the modern-day slumlords. I think that’s what we’re seeing right now in terms of the fact that: If they could leverage their assets, we could be moving mountains right now, as it relates to all the things we’re trying to accomplish in the nursing home and assisted living industry.

The real estate aspect gets lost in these conversations, especially when you talk about government aid for operators — there’s an argument I’ve seen that because there are all these for-profit companies that run nursing homes and assisted living facilities, they shouldn’t get any more assistance. But that doesn’t really take into consideration the fact that many operators sold their real estate for a cash injection, and have ongoing rent obligations — in some cases, obviously not all, the operational side isn’t the one with the financial leverage.

It’s a combined problem, because the concern I have is — I don’t disagree with the operators who say they don’t have enough money. However, I worry that just giving extra money doesn’t necessarily solve the problem, because the way a lot of the business structures around nursing homes are structured, both with real estate and other related parties, I am not confident that additional funding to the operations will end up supporting frontline clinical, quality care. I worry that it’ll end up in the hands of the real estate owners, the related party businesses.

This is one of those pivotal moments — as you said, an inflection point — where the industry as a business needs to decide: Do we want to own this and all work together to improve care? Or do we want the government to change the way we function?

And I think that’s what’s going come out of this in the long run. I think the advocacy groups — and I’ve seen some of their proposals — are going to gain tremendous strength because of COVID. I think Congress, I think the consumers are going to be asking a lot of questions. And if the non-operational part of the industry doesn’t take a hard look in the mirror, I think they’re getting run over.

This interview has been condensed and edited for clarity.