nursing home ownership
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A top Centers for Medicare & Medicaid Services enforcement official said Tuesday that the agency is eager to use data collected under a proposed ownership transparency rule to “scrutinize how certain ownership types correlate with quality of care and costs.”

Those comments came during the agency’s quarterly stakeholder’s call, during which Dara Corrigan, deputy CMS administrator and director of the agency’s Center for Program Integrity, reinforced the Biden administration’s interest in making more owner details publicly available. 

“This disclosure is critical because it allows us and others to analyze the ownership and management data and to see whether certain types of ownership have a positive or negative effect on the quality of care or cost of care,” she said. “We want to make sure that the nursing home industry is more transparent.”

Coorigan noted that about 70% of nursing homes are owned by for-profit companies, and that there has been a recent increase in acquisitions by private equity companies and real estate investment trusts. Those were the targets of the new rule, which adds definitions for both owner types and triggers changes to CMS provider enrollment forms to capture more information. The agency also hopes the changes will lead to a better understanding of related party relationships.

“Nursing homes frequently use other companies to provide various services,” Coorigan said Tuesday. “Generally, the public doesn’t know what companies provide which services or [whether] companies might be contracted to nursing home owners. Making this information available publicly empowers nursing home residents and their families to make more informed decisions about their care.”

Coorigan said the agency’s goal is that its own work and that of researchers will find correlations between quality and ownership.

The agency is currently reviewing formal comments on its ownership transparency rules; the submission period ended April 14. Several groups, including 18 states attorneys general, have submitted comments in favor of the rule, saying more transparency would improve their enforcement approaches.

Providers said they aren’t necessarily opposed to the proposed requirement itself. But many have bristled at the tone CMS has taken on the issue, given the sector’s intense need for investment in the current market.

Many fear the added scrutiny and reporting could turn some interested investors away from long-term care.

“We support transparency and appreciate the Administration’s efforts to assist families in making more informed decisions,” American Health Care Association President and CEO Mark Parkinson said after the rule was proposed in February. “Less than 5% of nursing homes are owned by private equity firms and roughly 12% are owned by a REIT, an entity that typically has no influence on daily operations.”