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A bill that would use the federal government’s Five-Star ratings system as a means to identify and punish poor quality nursing homes passed a New Jersey senate committee Thursday, drawing criticism in the process.

Two senators who balk at the state funding nursing homes that rate only 1 or 2 two stars in the Centers for Medicare & Medicaid Services’s Nursing Home Care Compare ratings introduced the bill. The measure would would require the state’s Department of Human Services to examine whether sanctions should be imposed against nursing homes that earn a single star in two consecutive quarters of Five-Star ratings. 

Penalties could include pausing new admissions or withholding Medicaid reimbursement, according to

If the 1-star rating lasts for three consecutive quarters, Human Services must require the offending facility to create and file a plan showing how the conditions could improve over the ensuing 18 months, under the bill.

Most recently, the state sent $107 million in Medicaid funding to its 12 one-star nursing homes, according to a report filed by acting state Comptroller Kevin Walsh’s in September. It was the second of the comptroller office’s two reports this year that raised awareness of New Jersey nursing homes that have frequently earned one star in the ratings.

“Should New Jersey be spending hundreds of millions to subsidize low-quality care?” Walsh said in that report. “We should demand more.”

The comptroller mentioned 15 facilities in February, and 12 in September, including six that had not been named in the previous report. There are 368 nursing homes in the state.

State Human Services, which runs the Medicaid program, stopped quality incentive payments to the 12 operators cited in the comptroller’s latest report, a department spokesman confirmed.

Fears of ‘piling on’ 

There was at least one provider objection to the bill’s use of the Care Compare site to begin the punishment process. James McCracken, president and CEO of Leading Age New Jersey & Delaware, said Five-Star data can be two years out of date.

“We are not opposed to penalties for poor-performing facilities,” McCracken told the committee. “We are concerned about the piling on of facilities, which ultimately may inhibit them from making the changes they need.”

McCracken said CMS and New Jersey already have the power to hold to account low-performing locations, citing Woodland Behavioral Health and Nursing Center as an example. The state’s largest nursing home closed in August after the federal government withdrew Medicaid funding and the state pulled Woodland’s license due to an inspection report that cited a continuing failure to prevent abuse and neglect of residents and to prevent the spread of COVID-19.

There has been a series of LTC-related legislation in the state since the pandemic began, spurred by the effects of COVID-19 and the sector’s response. The death toll of nursing home residents and staff is at nearly 10,000. The committee Thursday also passed through three other nursing home related bills.

One gives the Department of Health authority to appoint a management team or a monitor after a nursing home shows a pattern and practice of violations of the standards of health, safety, and resident care. That monitor would be paid by the nursing home, said the bill.Another enables the creation of mission critical teams to enter a long-term care facility to help an operator who is confronting an outbreak or emergency. The fourth bill sent through the committee would give an additional $1 million to the Office of State Long-Term Care Ombudsman and would increase its authority to help all LTC residents, not just those who are deemed elderly.