Some nursing homes in Kansas have been misclassified as continuing care retirement communities (CCRCs), resulting in the state losing close to $88 million in assessment revenue.
That’s according to a performance audit conducted by the Kansas Medicaid Inspector General’s (MIG) office, which found that 68% of CCRC certifications between July 2020 and Aug. 31, 2023 were not in compliance with statutory requirements.
If the recommendations of the Inspector General’s office are followed, Kansas facilities could be charged tens of millions of dollars in additional taxes.
Nursing homes pay assessment revenue to the state for Medicaid reimbursement purposes, which are then matched by federal funds. CCRCs pay a lower quality care assessment than nursing homes – the standard rate for nursing home assessments is $4,908 per bed, compared to $818 per bed for CCRCs, according to a report from WIBW.
About 24% of quality care assessments went to facilities that were not true CCRCs, the report found, and were being assessed at a reduced rate. In these instances, facilities were found to only provide one level of care instead of the post-acute continuum of care usually associated with CCRCs.
“Lenient oversight” allowed nursing homes to qualify as CCRCs without sufficient evidence that they met requirements, Anderson told WIBW. “There’s obviously an incentive to be a continuing care facility,” he said.
The Kansas Health Care Association (KHCA) and Kansas Center for Assisted Living (KCAL) in a statement acknowledged the work and effort of the State Attorney General and Medicaid Inspector General for looking into CCRC status, while adding that the legislature is close to passing a bill which would better define CCRCs and change the agency in charge of oversight.
“Early in 2024, the Kansas legislature began considering HB 2784 which moves the certification authority from the Kansas Insurance Department (KID) to the Kansas Department for Aging and Disability Services (KDADS),” said Linda MowBray, president and CEO of KHCA/KCAL. “Having the authority for CCRC certification under KDADS makes sense as they already provide licensing, survey and reimbursement and oversight for long term care.”
Additionally, the bill’s definition of levels of care will help simplify what constitutes a CCRC, she said. “We look forward to working with KDADS in this new capacity assuring that nursing homes properly receive their CCRC certificate.”
The report had several recommendations to improve oversight of CCRC certifications, which are expected to save the state millions of dollars annually.
Some state government bodies, including the Kansas Department of Insurance, believe the performance audit is an “unprecedented overreach” by the Medicaid department. The Insurance department disagrees with the methodology, assumptions and conclusions of the report.
“Contrary to the MIG’s assertion, the state would not save millions,” the state’s Insurance department told WIBW. “If the MIG’s conclusions are accepted and recommendations followed, Kansas businesses would be charged tens of millions of dollars in additional taxes, which would have a devastating impact on the availability of care for senior Kansans.”
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