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CMS backtracks on Compliance and Ethics Program requirements and expects the proposed rule’s changes to achieve $616 million in annual savings for LTC facilities.

A new Centers for Medicare & Medicaid Services (CMS) proposed rule significantly modifies a October 2016 final rule for long-term care (LTC) facilities. The proposed rule, entitled “Medicare & Medicaid Programs; Requirements for Long-Term Care Facilities: Regulatory Provisions to Promote Efficiency and Transparency,” proposes to remove requirements for participation identified as unnecessary, obsolete, or excessively burdensome on LTC facilities, also known as “nursing homes.” This proposed change is designed to identify opportunities for reducing administrative burdens by simplifying and/or streamlining the Medicare health and safety standards that LTC facilities must meet in order to serve their residents. The changes would affect the requirements for participation related to resident rights, clinical care, documentation requirements, and surveys. The changes would range from substantially reducing the detailed, specific requirements in the Quality Assurance and Performance Improvement (QAPI) regulations related to prescription requirements. CMS expects the provisions in the rule, if finalized, to achieve $616 million in savings annually for these facilities. The proposed rule would:

  • Reduce the frequency of required facility assessments;
  • Allow LTC facilities flexibility to streamline their compliance and ethics programs;
  • Reduce requirements for individuals responsible for the compliance and ethics program;
  • Reduce the frequency for compliance program reviews;
  • Increase requirement flexibility with directors of food and nutrition services;
  • Allow greater flexibility in tailoring their QAPI program to specific facility needs by eliminating prescriptive requirements; and
  • Update Informal Dispute Resolution (and independent process) by adding timeframes on process, and increased provider transparency.

The proposed changes include removing many of the requirements from the rule that were not expressly required by statutes related to the mandates for compliance and ethics programs. CMS continues with the expectation that facilities will have enough resources and will designate an individual that would have appropriate authority to assure compliance with the regulations. Each facility must still develop, implement, and maintain an effective compliance and ethics program that includes written compliance standards, and policies and procedures that are reasonably capable of reducing the prospect of criminal, civil, and administrative violations. Reasonable steps must be taken to achieve compliance with program standards, policies, and procedures, including monitoring and auditing that is reasonably designed to detect criminal, civil, and administrative violations. This includes effectively communicating the compliance standards, policies, and procedures in mandatory compliance training. Facilities should also have in place and publicize a reporting system whereby anyone could report violations by others within the organization without fear of retribution, and ensure consistent enforcement and discipline of standards, policies, and procedures. Furthermore, after a violation is detected, reasonable steps must be taken to respond and prevent similar violations in the future.

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