Already, the administration is six months behind its self-imposed deadline of February to propose new rules.

This article was published on Tuesday, August 29, 2023 in KFF Health News.

By Jordan Rau

The Biden administration last year promised to establish minimum staffing levels for the nation's roughly 15,000 nursing homes. It was the centerpiece of an agenda to overhaul an industry the government said was rife with substandard care and failures to follow federal quality rules.

But a research study the Centers for Medicare & Medicaid Services commissioned to identify the appropriate level of staffing made no specific recommendations and analyzed only staffing levels lower than what the previous major federal evaluation had considered best, according to a copy of the study reviewed Monday by California Healthline. Instead, the new study said there was no single staffing level that would guarantee quality care, although the report estimated that higher staffing levels would lead to fewer hospitalizations and emergency room visits, faster care, and fewer failures to provide care.

Patient advocates said the report was the latest sign that the administration would fall short of its pledge to establish robust staffing levels to protect the 1.2 million Americans in skilled nursing facilities. Already, the administration is six months behind its self-imposed deadline of February to propose new rules. Those proposals, which have not been released, have been under evaluation since May by the Office of Management and Budget. The study, dated June 2023, has not been formally released either, but a copy was posted on the CMS website. It was taken down shortly after California Healthline published this article.

"It's honestly heartbreaking," said Richard Mollot, executive director of the Long Term Care Community Coalition, a nonprofit that advocates for nursing home patients in New York state. "I just don't see how this doesn't ultimately put more residents at risk of neglect and abuse. Putting the government's imprimatur on a standard that is patently unsafe is going to make it much more difficult for surveyors to hold facilities accountable for the harm caused by understaffing nursing homes."

For months, the nursing home industry has been lobbying strenuously against a uniform ratio of patients to nurses and aides. "What is clear as you look across the country is every nursing home is unique and a one-size-fits-all approach does not work," said Holly Harmon, senior vice president of quality, regulatory, and clinical services at the American Health Care Association, an industry trade group.

Nursing home groups have emphasized the widespread difficulty in finding workers willing to fill existing certified nursing assistant jobs, which are often grueling and pay less than what workers can make at retail stores. Homes say their licensed nurses are often drawn away by other jobs, such as better-paying hospital positions. "The workforce challenges are real," said Katie Smith Sloan, president and CEO of LeadingAge, an association that represents nonprofit nursing homes.

The industry has also argued that if the government wants it to hire more workers it needs to increase the payments it makes through state Medicaid programs, which are the largest payor for nursing home care. Advocates and some researchers have argued that nursing homes, particularly for-profit ones, can afford to pay employees more and hire additional staff if they forsake some of the profits they give investors.

"Certainly, facilities haven't put all the dollars back into direct care over the years," said David Grabowski, a professor of health care policy at Harvard Medical School. "But for certain facilities, it's going to be a big lift to pay for" higher staffing levels, he said in an interview last week.

In a written statement to KFF Health News, Jonathan Blum, CMS' principal deputy administrator and chief operating officer, said the study had been posted in error. "CMS is committed to holding nursing homes accountable for protecting the health and safety of all residents, and adequate staffing is critical to this effort," he said. "CMS's proposal is being developed using a rigorous process that draws on a wide range of source information, including extensive input from residents and their families, workers, administrators, experts, and other stakeholders. Our focus is on advancing implementable solutions that promote safe, quality care for residents." Blum's statement called the study a "draft," although nothing in the 478-page study indicated it was preliminary.

The study has been widely anticipated, both because of the central role the administration said it would play in its policy and because the last major CMS study, conducted in 2001, had concluded that nursing home care improves as staffing increases up to the level of about one worker for every six residents. The formal metric for that staffing level was 4.1 staff hours per resident per day, which is calculated by dividing the number of total hours worked by nurses and aides on duty daily by the number of residents present each day.

CMS never adopted that staffing ratio and instead gave each nursing home discretion to determine a reasonable staffing level. Regulators rarely cite nursing homes for insufficient staffing, even though independent researchers have concluded low staffing is the root of many nursing home injuries. Too few nurse aides, for instance, often means immobile residents are not repositioned in bed, causing bedsores that can lead to infection. Low staffing also is often responsible for indignities residents face, such as being left in soiled bedsheets for hours.

The new research was conducted by Abt Associates, a regular contractor for CMS that also performed the 2001 study. But the report, in an implicit disagreement with its predecessor, concluded there was "no obvious plateau at which quality and safety are maximized or ‘cliff' below which quality and safety steeply decline." Abt referred questions about the study to CMS.

The study evaluated four minimum staffing levels, all of which were below the 4.1 daily staff hours that the prior study had identified as ideal. The highest was 3.88 daily staff hours. At that level, the study estimated 0.6% of residents would get delayed care and 0.002% would not get needed care. It also said that staffing level would result in 12,100 fewer hospitalizations of Medicare residents and 14,800 fewer emergency room visits. The report said three-quarters of nursing homes would need to add staff to meet that level and that it would cost $5.3 billion extra each year.

The lowest staffing level the report analyzed was 3.3 daily staffing hours. At that level, the report said, 3.3% of residents would get delayed care and 0.04% would not get needed care. That level would reduce hospitalizations of Medicare residents by 5,800 and lead to 4,500 fewer emergency room visits. More than half of nursing homes would have to increase staff levels to meet that ratio, the report said, and it would cost $1.5 billion more each year.

Charlene Harrington, a professor emeritus of nursing at the University of California-San Francisco, said CMS "sabotaged" the push for sufficiently high staffing through the instructions it gave its contractor. "Every threshold they looked at was below 4.1," she said. "How can that possibly be a decent study? It's just unacceptable."

This article was produced by KFF Health News, formerly known as Kaiser Health News (KHN), a national newsroom that produces in-depth journalism about health issues and is one of the core operating programs at KFF — the independent source for health policy research, polling, and journalism. 

A bill before the legislature would significantly increase the fees doctors pay to fund the medical board.

This article was published on Friday, August 25, 2023 in KFF Health News.

By Annie Sciacca

California doctors and state lawmakers are squaring off once again over the future of the Medical Board of California, which is responsible for licensing and disciplining doctors and has been criticized by patient advocates for years for being too lax.

A bill before the legislature would significantly increase the fees doctors pay to fund the medical board, which says it hasn't had the budget to carry out its mission properly. It would also mandate new procedures for investigating complaints.

Patient advocates say the board, which oversees about 150,000 physicians and surgeons with active licenses in the state, is hamstrung by a lack of funding and clunky processes, and that its shortcomings pose a risk to the public by allowing bad doctors to continue practicing. The board opened only about 1,000 investigations out of nearly 10,000 complaints last year, according to its 2022 annual report.

But the California Medical Association, which represents physicians, is again fighting proposed increases in the fee, which was unchanged for more than a decade before being raised in 2021 after a contentious debate. Now lawmakers want to boost the license renewal fee to $1,289 every two years, up from $863 currently.

The doctors' lobby largely defeated the 2021 efforts to strengthen the board, and critics say the group is trying to whittle away the board's power by depriving it of funding.

The legislation, sponsored by Sen. Richard Roth, a Riverside Democrat, would also require board staff to interview patients or families before closing their complaints, create a unit to better facilitate communications, and improve efficiency by changing procedures and adjusting standards of evidence for investigations.

Another provision would allow patients and relatives to make a statement during the investigation about how a doctor's negligence or misconduct affected them — similar to crime victims speaking during a sentencing hearing in criminal court.

The bill faces a pivotal vote in the state Assembly's Appropriations Committee this month.

Most California licensing boards are funded through license fees. Currently, dentists pay $668 for a two-year license renewal, plus other permitting fees such as $325 for general anesthesia or $650 for oral surgery. Attorneys actively practicing in California pay $510 annually.

But the medical association insisted in a memo that it "cannot agree to a fee increase of nearly 50% that will primarily go toward building a multimillion-dollar reserve fund and future programs for the Medical Board."

"If the bill is passed in its current form, it would have vast, negative impacts on the practice of medicine and healthcare delivery in California," it added.

George Soares, a legislative advocate for the California Medical Association, told lawmakers last month that the association would be willing to accept a fee increase, but that $1,289 is too much — more than double the national average for state medical licenses. A July working paper from the National Bureau of Economic Research found that physicians' annual earnings average $350,000 across the U.S.

The medical board supports the bill and says a fee hike is needed to cover operations, repay millions of dollars in loans, and establish a three-month reserve. Over the past two years, the Department of Consumer Affairs, which is responsible for the operations of the medical board and other licensing boards, has had to backfill the board's $79 million budget, using a total of $18 million in loans from Bureau of Automotive Repair license fees to cover the gap.

"The simple reality is that the board is not able to pay its bills," a spokesperson for the medical board read from a joint statement from Randy Hawkins, the vice president of the board, and Richard Thorp, a former president of the California Medical Association and current member of the board, at a committee hearing last month.

"We are physicians in private practice, and this fee increase will impact us personally, albeit at an increased cost of less than $20 per month," the statement read. "We do not see this as a burden but rather as an investment into the organization that helps ensure that physicians have the confidence of the patients that we are privileged to treat."

Roth points out that the medical board, which is composed of eight physicians and seven members of the public, has little control over staffing costs. Its 169 employees work for the state and are covered by labor agreements negotiated by statewide employee unions.

Consumer advocates say the opposition from the doctors' lobby is part of a years-long effort to weaken the board and deprive it of adequate funding.

A report about the medical board's operations conducted by a consulting firm that serves as the enforcement monitor for the board, Alexan RPM Inc., underscored the board's financial challenges and recommended adopting automatic annual fee increases tied to the consumer price index, or something similar. Some lawmakers suggested the fees could be determined on a sliding scale based on doctors' income.

Critics have complained for years that the medical board doesn't hold doctors accountable often enough. Families that file complaints against doctors frequently go years without updates on the status of investigations, and often aren't told why when their complaints are rejected.

"This is kind of the culmination of two things: patient advocacy trying to make changes and a few years of very recent, direct pushes by the legislature," said Carmen Balber, the executive director of Consumer Watchdog, a consumer and patient advocacy organization.

The California Medical Association has already blunted some aspects of the bill, including securing the removal of a provision to add two more members of the public to the board, which would have made it a public-member majority instead of its current physician majority.

The association is also opposed to a provision currently in the bill that would lower the standard of proof for disciplining doctors in instances besides those in which they could lose their licenses.

Tracy Dominguez, a Bakersfield resident whose daughter, Demi, and grandson, Malakhi, died in 2019 from complications of severe preeclampsia, is among those advocating for reforms.

One of the physicians who treated Dominguez's daughter prior to her death had already been accused by the medical board of gross negligence that led to the death of a young mother, according to medical board documents. Advocates at Consumer Watchdog allege his negligence had already caused death or permanent injury of other mothers and babies he treated, and that he was already banned from practicing in some hospitals at the time he treated Demi Dominguez but had been allowed to keep his license.

Tracy Dominguez said she hopes changing evidentiary standards and strengthening the medical board overall "will put dangerous doctors away."

And a chance to provide a victim impact statement would be important for families hurt by medical neglect, she added. It would be "an opportunity for them to hear from the family, directly — to know that she was a person, not just a number."

This article was produced by KFF Health News, which publishes California Healthline, an editorially independent service of the California healthcare Foundation. 

Annie Sciacca: @anniesciacca

Insurers say the prior authorization helps them control costs.

This article was published on Wednesday, August 23, 2023 in KFF Health News.

By Lauren Sausser

Sally Nix was furious when her health insurance company refused to pay for the infusions she needs to ease her chronic pain and fatigue.

Nix has struggled with a combination of autoimmune diseases since 2011. Brain and spinal surgeries didn't ease her symptoms. Nothing worked, she said, until she started intravenous immunoglobulin infusions late last year. Commonly called IVIG, the treatment bolsters her compromised immune system with healthy antibodies from other people's blood plasma.

"IVIG turned out to be my great hope," she said.

That's why, when Nix's health insurer started denying payment for the treatment, she turned to Facebook and Instagram to vent her outrage.

"I was raising Cain about it," said Nix, 53, of Statesville, North Carolina, who said she was forced to pause treatment because she couldn't afford to pay more than $13,000 out of pocket every four weeks. "There are times when you simply must call out wrongdoings," she wrote on Instagram. "This is one of those times."

Prior authorization is a common cost-cutting tool used by health insurers that requires patients and doctors to secure approval before moving forward with many tests, procedures, and prescription medications. Insurers say the process helps them control costs by preventing medically unnecessary care. But patients say the often time-consuming and frustrating rules create hurdles that delay or deny access to the treatments they need. In some cases, delays and denials equal death, doctors say.

That's why desperate patients like Nix — and even some physicians — say they have turned to publicly shaming insurance companies on social media to get tests, drugs, and treatments approved.

"Unfortunately, this has become a routine practice for us to resort to if we don't get any headway," said Shehzad Saeed, a pediatric gastroenterologist at Dayton's Children's Hospital in Ohio. In March, he tweeted a photo of an oozing skin rash, blaming Anthem for denying the biologic treatment his patient needed to ease her Crohn's disease symptoms.

In July, Eunice Stallman, a psychiatrist based in Idaho, joined X, formerly known as Twitter, for the first time to share how her 9-month-old daughter, Zoey, had been denied prior authorization for a $225 pill she needs to take twice a day to shrink a large brain tumor. "This should not be how it's done," Stallman said.

The federal government has proposed ways to reform prior authorization that would require insurance companies to provide more transparency about denials and to speed up their response times. If finalized, those federal changes would be implemented in 2026. But even then, the rules would apply only to some categories of health insurance, including Medicare, Medicare Advantage, and Medicaid plans, but not employer-sponsored health plans. That means roughly half of all Americans wouldn't benefit from the changes.

The 2010 Patient Protection and Affordable Care Act prohibits health insurance plans from denying or canceling coverage to patients due to their preexisting conditions. AHIP, an industry trade group formerly called America's Health Insurance Plans, did not respond to a request for comment.

But some patient advocates and health policy experts question whether insurers are using prior authorization as "a possible loophole" to this prohibition, as a way of denying care to patients with the highest health care costs, explained Kaye Pestaina, a KFF vice president and the co-director of its Program on Patient and Consumer Protections.

"They take in premiums and don't pay claims. That's how they make money," said Linda Peeno, a health care consultant and retired Kentucky physician who was employed as a medical reviewer by Humana in the 1980s and later became a whistleblower. "They just delay and delay and delay until you die. And you're absolutely helpless as a patient."

But there's reason to hope things may get marginally better. Some major insurers are voluntarily revamping their prior authorization rules to ease preapproval mandates for doctors and patients. And many states are passing laws to rein in the use of prior authorization.

"Nobody is saying we should get rid of it entirely," said Todd Askew, senior vice president for advocacy at the American Medical Association, in advance of the group's annual meeting in June. "But it needs to be right-sized, it needs to be simplified, it needs to be less friction between the patient and accessing their benefits."

Customers are increasingly using social media to air their complaints across all industries, and companies are paying attention. Nearly two-thirds of complainants reported receiving some sort of response to their online post, according to the 2023 "National Consumer Rage Survey," conducted by Customer Care Measurement & Consulting in collaboration with Arizona State University.

Some research suggests companies are better off engaging with unhappy customers offline, rather than responding to public social media posts. But many patients and doctors believe venting online is an effective strategy, though it remains unclear how often this tactic works in reversing prior authorization denials.

"It's not even a joke. The fact that that's how we're trying to get these medications is just sad," said Brad Constant, an inflammatory bowel disease specialist who has published research on prior authorization. His work found that prior authorizations are associated with an increased likelihood that children with inflammatory bowel disease will be hospitalized.

Saeed said the day after he posted the picture of the skin rash, the case was marked for a peer-to-peer review, meaning the prior authorization denial would get a closer look by someone at the insurance company with a medical background. Eventually, the biologic medicine Saeed's patient needed was approved.

Stallman, who is insured through her employer, said she and her husband were prepared to pay out of pocket if Blue Cross of Idaho didn't reverse the denial for the drug Zoey needed.

Bret Rumbeck, a spokesperson for the insurer, said Zoey's medication was approved on July 14 after the company consulted an outside specialist and obtained more information from Zoey's doctor.

Stallman posted details about the ordeal online only after the insurer approved the drug, in part, she said, to prevent them from denying the treatment again when it comes up for a 90-day insurance review in October. "The power of the social media has been huge," she said.

Nix had been insured by Blue Cross Blue Shield of Illinois through her husband's employer for almost two decades. Dave Van de Walle, a spokesperson for the company, did not specifically address Nix's case. But in a prepared statement, the company said it provides administrative services for many large employers who design and fund their own health insurance plans.

Nix said an "escalation specialist" from the insurance company reached out after she posted her complaints on social media, but the specialist couldn't help.

Then, in July, after KFF Health News contacted Blue Cross Blue Shield of Illinois, Nix logged in to the insurer's online portal and found that $36,000 of her outstanding claims had been marked "paid." No one from the company had contacted her to explain why or what had changed. She also said she was informed by her hospital that the insurer will no longer require her to obtain prior authorization before her infusions, which she restarted in late July.

"I'm thrilled," she said. But "it just should never have happened this way."

Do you have an experience with prior authorization you'd like to share? Click here to tell your story.

Lauren Sausser: lsausser@kff.org, @laurenmsausser

Federal officials are trying to clamp down on private arrangements among some hospitals to pay themselves back for the Medicaid taxes they’ve paid. State health officials and the influential hospital industry argue that regulators have no jurisdiction over the agreements.

by Samantha Young

The Biden administration wants to crack down on private arrangements among some hospitals to reimburse themselves for taxes that help fund coverage for low-income people. It contends the practice violates federal law.

Federal regulators say these arrangements “appear designed to” redirect Medicaid dollars away from facilities that treat the poorest patients to those that “provide fewer, or even no, Medicaid-covered services,” according to a proposed enforcement plan released May 3 by the Centers for Medicare & Medicaid Services.

The practice is typically orchestrated by the lobbying groups that represent hospitals in state capitals — and is often kept secret. Not even federal regulators know how widespread it is, although programs operate in at least a few states, including California and Missouri. It’s also the subject of a Texas lawsuit that could block the federal government’s proposal.

“It does seem like these associations are finding a way to distribute the money in a really weird way,” said Joshua Gordon, the director of health policy for the Committee for a Responsible Federal Budget in Washington, D.C. “But without the transparency, we don’t exactly know what’s going on.”

Previous efforts to block these payback arrangements have gone nowhere in the face of opposition from the powerful health care industry and state health officials who fear that clamping down could result in less money for Medicaid, the joint state-federal health insurance program for low-income people. Several Medicaid experts predicted the latest proposal could meet the same fate, or face immediate court challenges if adopted.

The federal government’s sweeping and contentious proposal would require states to police hospitals, nursing homes, and other health care providers to ensure they made no private agreements to redistribute Medicaid dollars.

Public and private hospitals argue CMS has no jurisdiction to regulate private transactions and has overstepped its legal authority. Together with state health officials from around the country, they warn the move could strip billions of federal dollars from Medicaid and threaten safety-net coverage for 94 million low-income people. Texas alone could lose $6 billion a year, according to Texas Health and Human Services.

KFF Health News attempted to interview state health leaders and hospital association officials around the country, but they declined to comment or did not respond to repeated calls and emails.

The federal government’s proposal is part of a broader Medicaid financing package, and it resurrects a long-standing effort by administrations of both parties over the years to rein in Medicaid spending — which ballooned to $734 billion in 2021.

In this case, regulators are targeting what are known as provider taxes, which states are increasingly imposing on hospitals, nursing homes, and other health care providers to help states pay for their share of the Medicaid program. The more provider taxes states levy, the more money they can also get in federal funding.

These taxes are a critical source of revenue that all states except Alaska rely on for their Medicaid programs — and to get federal matching Medicaid dollars. They account for 17% of state Medicaid funding in 2018, according to a 2020 report by the Government Accountability Office, which called for more transparency in how the money is collected and spent.

In California, hospitals have redistributed provider tax funds since 2009. Here’s how it works: Hospitals with a significant share of low-income patients get more Medicaid funding back than they pay in the tax, so they donate a small portion of their Medicaid funding to a charity run by the leadership of the California Hospital Association, a statewide lobbying organization. The charity awards grants to the hospitals that treat a smaller share of low-income patients and don’t receive as much funding back as they paid in taxes.

For instance, Cedars-Sinai in Los Angeles, one of the country’s richest hospitals, paid nearly $172 million in provider taxes in 2022, eclipsing the $151 million it got back in Medicaid dollars. Then, it received nearly $28 million from the hospital association’s charity — earning about $6.9 million from the program, the hospital’s audited financial statements show.

Meanwhile, faith-based Adventist Health, which serves a larger share of poor people and operates roughly two dozen hospitals in California, Oregon, and Hawaii, paid $148 million in taxes in 2022 and reaped $401 million in Medicaid dollars through the program, according to its independently audited financial statements. It then contributed $3 million of that Medicaid money to the charity.

Federal law sets stringent rules for provider taxes: They must be broad-based and apply to all providers within a certain category, like hospitals; providers within a state must be taxed at the same rate; and taxes can’t be returned directly or indirectly to providers as part of a “hold harmless” agreement.

It’s that last clause that has spurred the feds to act.

Regulators say some health care providers, to gain the needed support within their ranks for the tax, are moving the tax money — and the federal revenue it draws to states — among themselves.

“We believe providers with relatively higher Medicaid volume agree to redistribute some of their Medicaid payments to ensure broad support for the tax program,” they wrote in their proposal.

These agreements “undermine the fiscal integrity” of the Medicaid program, they wrote.

It’s unclear how widespread such agreements are because hospitals don’t make them public. CMS said it has identified “instances” of Medicaid redistribution payments, but spokesperson Greg Myers declined to elaborate.

Jonathan Williams, vice president of government affairs at Sutter Health, which operates about 20 hospitals across Northern California, argued in a June 30 letter to the federal agency that these arrangements help hospitals expand “care networks and afford necessary incentives to ensure that providers can continue caring for Medicaid beneficiaries with unique and specific care needs.”

Missouri’s hospital association also runs a “pooling arrangement,” in which hospitals that get more Medicaid money than they paid in taxes can donate funds to the hospitals that didn’t.

“Missouri providers have had various private agreements to redistribute funds among themselves for decades, with the full knowledge and approval of CMS,” according to an unsigned and undated letter to the agency from the MO HealthNet Division, which runs the state’s Medicaid program.

In 2002, Missouri got federal approval for its redistribution program by pledging to use the funds for Medicaid services, whereas California has not received approval.

The federal government’s plan would require states to get health care providers to attest that they don’t participate in any arrangement that violates federal law. State officials described the proposal as an impractical administrative burden that could dissuade hospitals, nursing homes, and other providers from participating in Medicaid altogether. “Imposing additional requirements on providers that participate in Medicaid managed care networks would only serve to further dissuade network participation, which will have a negative impact on member access to care,” Mike Levine, the assistant secretary for MassHealth, Massachusetts’ Medicaid program, wrote to CMS on July 3.

Texas, which has long tangled with the federal agency over how it funds its Medicaid program, sued in federal court earlier this year after the agency declared in a separate letter to states that these types of arrangements aren’t allowed and must be reported. The letter was sent in February, before the agency issued its formal proposal.

In June, a federal judge handed Texas and its health care industry a victory, temporarily delaying the reporting requirement that regulators had outlined in their February letter. The judge agreed with Texas that the agency had exceeded its legal authority and couldn’t regulate private agreements.

State health officials and hospital leaders are pointing to the Texas court case as evidence that the agency’s May proposal to crack down on the redistribution of Medicaid funds is a “widely controversial interpretation” of the law, as the Tennessee Hospital Association put it in a July 3 letter to CMS.

Federal regulators have not said if or when they will implement their plan. The last time the agency issued a sweeping Medicaid financing proposal, it withdrew it almost a year later.

Mark McClellan, who served as head of the Centers for Medicare & Medicaid Services for two years during the George W. Bush administration, predicted states and Congress would push back hard if the new proposal moved forward.

“Medicaid is a huge component of state spending and keeps getting bigger,” McClellan said. “So, sudden CMS changes or clamping down is going to be disruptive for state coverage.”