Under the rule, facilities will be required to disclose whether they're private equity groups.
The U.S. Department of Health & Human Services (HHS) on Monday proposed a rule to increase the transparency of nursing home ownership and management. Early last year, the Biden administration made nursing home safety a priority and increased efforts to hold nursing homes accountable for the care they provide.
The proposed rule will require nursing homes to disclose ownership and management information to the Centers for Medicare & Medicaid Services (CMS) and states. Nursing home owners will also be required to disclose whether they're private equity investors or real estate investment trusts.
A study from Weill Cornell Medical College found that residents in nursing homes acquired by private equity groups are 11.1% more likely to have preventable emergency room visits and 8.7% more likely for a preventable hospitalization, compared to those not associated with private equity facilities.
Nursing homes enrolled in Medicare and Medicaid will also be required to disclose ownership information, as well as information on external entities providing administrative or clinical consulting services to the facility.
"We are continuing our unprecedented efforts to increase nursing home ownership transparency—because it's what the public deserves," Xavier Becerra, HHS secretary, said in a statement. "We are pursuing all avenues to shine a light on this industry. We will keep doing everything we can to ensure all Americans receive the dignity, care, and respect they deserve."
By increasing transparency, nursing home residents and their families will be able to make informed decisions about care, according to CMS.
Katie Smith Sloan, president and CEO of LeadingAge, an organization representing nonprofit aging service providers, agreed with the need for transparency in a statement.
"We agree with the administration that ownership and financing of nursing homes should be transparent to help ensure that owners or associated businesses do not profit at the cost of quality care," she said. "The proposed disclosure and reporting requirements set out in today's proposed rule are a step in the right direction."
“We are continuing our unprecedented efforts to increase nursing home ownership transparency—because it's what the public deserves.”
Xavier Becerra, secretary, U.S. Department of Health and Human Services
Jasmyne Ray is the revenue cycle editor at HealthLeaders.
KEY TAKEAWAYS
The new rule would increase transparency of nursing home ownership and management.
Information would be disclosed to the Centers for Medicare and Medicaid Services and states.
Nursing homes enrolled in Medicaid or Medicaid will be also be required to disclose information on external entities providing administrative or clinical consulting services.