The pandemic created myriad risk factors for nursing home operators, many of whom have been primarily focused on staffing shortages and infection control for the past three years.
Yet as the industry continues to evolve, operators may need to diversify their risk mitigation strategies to prepare for higher acuity residents, the implementation of the Phase 3 Requirements of Participation survey requirements and new payment models.
“At times, it almost feels like you have to find a way to fit 27 hours into a 24-hour day,” Steve LaForte, Cascadia Healthcare’s director of corporate affairs and general counsel, said.
Although most operators can’t afford to hire an outside risk management team, maintaining a good insurance brokerage relationship with a focus on compliance and regulations can help providers stay ahead, LaForte said during the Skilled Nursing News virtual Risk Summit.
“One of the things from the legal risk department standpoint that I’ve done over the last couple of years is we’ve built out our department and we’ve built it out with more regulatory experience and more risk experience — risk on the insurance side,” he said.
He predicted that as demographics shift in the long-term care population, providers may see a rise in census that coincides with an increase in higher acuity patients.
As a result, providers will need to be ready to train new leaders in the industry, especially new administrators and directors of nursing (DON), who may only have experience working during Covid.
“Developing the leadership qualities within the communities and the operations [so] that we can focus on that staff retention and can get moved back into a more normalized structure without agency in the community [can help mitigate risk],” Heather Haberhern, senior vice president of quality at Health Dimensions Group, said during the panel.
New requirements for risk management
Although CMS released Phase 3 RoP regulations for nursing homes back in 2019, there was no interpretative guidance and survey agencies had limited ability to assess compliance to the updated standards.
Those changes are already in the works and operators need to make sure they are up-to-date, according to Haberhern. The agency gave surveyors and providers until Oct. 24 before guidelines went into effect.
“We’ve had new surveys pop up in communities recently, where we haven’t been prepared as well as we should have been, because our eyes have been off the ball for the last three years and focused elsewhere. And so I think that there’s a tremendous risk,” she said during the panel.
Staffing and infection control were among the main areas of focus in the CMS guidance.. From a financial standpoint, some operators have been hit with monetary penalties anywhere from $15,000 to $36,000 since the new regulations went into effect.
“In some communities, that’s a huge risk for them financially, so I think we need to be able to get ahead of it and have a solid process in place to manage that,” she said.
Cascadia has also been increasingly more attentive to its regulatory and compliance departments with the new regulations coming into effect, according to LaForte.
“We’ve really enhanced our programs in the last couple of months and I would say at least for the next six months we’re going to be rolling out significant education to the field to make sure everybody’s ready when the survey comes in,” he said.
Operators may also need to account for the different payment drivers that come with the Patient Driven Payment Model (PDPM).
“Being able to really navigate those areas and bring attention back to the different components of PDPM I think is going to be a tremendous area of risk if we’re not prepared for the new payment model moving forward,” Haberhern said. “As we’re moving back to a more normal environment within our operations, we’re gonna have to really keep our eye on that as well and bring education and training for your team members.”
Planning for the best outcomes
With risk-based models like Institutional Special Needs Plans (I-SNPs) and Accountable Care Organizations ACOs maturing across care settings, it remains clear that CMS wants the majority of medicare beneficiaries to be under an Medicare Advantage plan.
Haberhern said if operators can focus on clinical quality and improving provider support across the continuum, risk-based models can be a great source of revenue for skilled nursing communities.
“We’ve got to make sure that if we’re providing great outcomes [and] that we’re seeing the revenue follow that, but I do think that we also need to learn to manage the residents care, making sure that they’re in the right setting in the right place at the right time for the right length of time,” she said.
LaForte said preparing to mitigate risk in the sector will involve continued conversations with CMS, trade groups like American Health care Association (AHCA) and state survey organizations.
COVID, he said, helped create an environment where government entities are more willing to listen to the needs of operators.
“The public health emergency created waivers that, you know, were for themes that we had talked about for years… All of a sudden, we put it in place overnight so the world didn’t fall apart,” he said.
He hopes work with state and federal government entities will continue in a collaborative rather than adversarial posture, especially with the consideration of enacting minimum staffing mandates.
“Most of the mandates we’re talking about are unfunded,” he said. “I think we need them to look at what’s sustainable for us, and how we maintain that care…we’re in a different place with acuity and complexity of care, so we all need to step up together.”
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