In 2025, the nursing home sector can expect several policy updates from the Centers for Medicare and Medicaid Services (CMS), Director Evan Shulman said on Tuesday. He highlighted the agency’s work on risk-based surveys to reduce delays and new consumer guides for which the agency is seeking feedback from nursing homes, among other initiatives.

Speaking at LeadingAge’s annual conference in Nashville, Shulman talked through about nine different policy updates while clarifying the intent and impact from the changes, including the newly issued guidance on Civil Monetary Penalties (CMPs) in the latest finalized payment rule for 2025.

As for the risk-based surveys, CMS shared in April 2024 its vision for a shorter, more focused survey. The agency has been in the testing phase for some time and aims to eventually target up to 10% of nursing facilities that consistently provide high-quality care. This risk-based survey (RBS) approach was primarily justified by the lack of increase in the federal survey budget since 2015.

“You spend less resources on less risky things to your business, and more resources on more risky things, which this is – really just like business 101 – for prioritizing resources,” said Shulman, explaining the benefit to CMS. “CMS and state agencies have not seen an increase in funding since 2015 … that causes problems for our entire system, including you, some of you who are waiting to be surveyed.”

Once the risk-survey is finalized, the timeline for which is unclear at this time, Shulman said CMS will invite facilities to fill out the paperwork. Facilities cannot initiate the process.

In other updates that the nursing home sector can expect in 2025, Shulman pointed to new consumer guides and encouraged providers to send in feedback to improve the consumer guides.

He also said that CMS is changing the administrator turnover measure on the 5-star ratings methodology, with the gap of employment counting towards turnover being extended from 60 to 90 days now, after the agency accepted feedback from providers.

“This makes room for a maternity or paternity leave or family leave, so that measure has been changed to allow for the individuals that come and go in greater than 60 days but less than 90 days [to] not count against your turnover measure,” Shulman said.

Regarding other changes to the 5-star ratings and Care Compare, with the Minimum Data Set (MDS) having been updated to replace Section G with Section GG, Shulman said CMS froze four quality measures related to mobility and function, which will be reinstated in January.

On the final new payment rule for SNFs that gave CMS more authority and flexibility on how to impose CMPs, which are changes that are slated for 2025, Shulman clarified how the updates will allow CMS to be more equitable over the penalties.

“What this rule allows us to do is to better calibrate how we calculate CMPs so that they are more representative of the type of non compliance that occurred and the type of harm or likelihood of harm that happened to a resident,” he said. “That’s really what this rule is about. Will some of you see your CMPs go up if you have this situation? Yes. Will some of you potentially see lower CMPs? Also yes. It’s trying to bring everyone closer to the middle.”

Meanwhile, discharges are another focus of the updates Shulman shared. He described the challenges surveyors face when evaluating the appropriateness of discharges, particularly for residents with complex needs, such as those suffering from dementia.

“Discharges that violate requirements are among the most complex issues we face,” Shulman said, explaining that while some discharges may be compliant, they can also reflect a failure to adequately address residents’ needs.

He highlighted scenarios where nursing homes may have accepted patients whose needs exceeded the level of care they could provide, calling for improved communication and partnership with hospitals to ensure accurate patient information is relayed upon discharge. In response, CMS has issued guidance to hospitals reinforcing their obligation to provide complete patient histories, which may also be helpful in documenting the use of antipsychotics and avoiding citations on surveys, he said.

Leaders share successful advocacy efforts from LeadingAge for 2025

As for lobbying to counter some of the challenges facing nursing homes, LeadingAge leaders stated that securing more reimbursement and tackling financial and administrative issues related to the growth of Medicare Advantage – particularly its problematic prior authorizations – were among their top concerns, along with efforts to oppose the federal government’s staffing mandate.

And legislative issues that LeadingAge has had most success with pushing along include HUD funding, with efforts to increase affordable housing for older adults, Katie Smith Sloan, president and CEO, said in a press conference also held Tuesday.

“I’m not sure we’ll see any legislation across the finish line this year, but I think members of Congress are finally paying attention to the challenges with Medicare Advantage for post-acute providers and beginning to address some of these issues around pre authorization,” Smith Sloan said, adding, “I haven’t seen much work yet on payment levels, reimbursement levels, but that’s got to come because it’s just a system that was created to be more broad without particular attention to how it would fit into a post acute environment.”

One issue that remains a “mystery” is the $75 million in workforce funding promised by the federal government as part of the federal staffing mandate, said Smith Sloan.

Other efforts leaders from LeadingAge highlighted include hospice reform, legislation supporting Certified Nursing Assistants (CNAs), addressing long standing workforce issues. This includes bipartisan support for training initiatives that have faced hurdles, reflecting a need for commonsense solutions to workforce shortages, leaders said.

Advocacy efforts are also ongoing around the federal staffing mandate, with several lawsuits currently in progress.

On improving workforce pressures, LeadingAge leaders said that there are anecdotal reports that retention rates for staff are improving, partly due to increased funding while agency use is down. However, operators have downsized, and the workforce metrics don’t reflect the development of this negative situation.

“There’s a lot of right sizing to fit the workforce availability,” said Smith Sloan. “Members have shut down wings and closed beds and done things because they don’t have the workforce.”

Facility assessments and the staffing mandate

For its part, CMS is continuing to forge ahead full force with its staffing mandate, Shulman said, despite LeadingAge and other advocacy groups’ efforts to derail the staffing mandate.

“We’re going forth. We know that there are lawsuits, but until we are told legally to do or not do something, then we’ll just move forward with business as usual,” Shulman said.

One of the early requirements of the final staffing rule – a stipulation that facilities already complete – are facility assessments.

CMS posted a template of the facility assessment, Shulman said.

“Don’t just focus on the paper compliance,” he advised. “I am very confident that every single one of you will be able to put together a compliant facility assessment on paper. And there’s also pieces that are not on paper, but you’ll need to demonstrate things like getting input from your staff, getting input from residents. Those are two big changes that are important parts of the new facility assessment requirements.”