Opinion: the five-star nursing home rating system is bad policy, hastily implemented

Share this content:
Mark Miller, Regulatory Affairs Manager, PANPHA
Mark Miller, Regulatory Affairs Manager, PANPHA
A good idea does not necessarily good policy make. For proof, look no further than the Centers for Medicaid & Medicare Services' recently unveiled Five-Star rating system for nursing homes. CMS intended for this system to make it easier for residents and their families to shop for care based on a “quality rating.”

Unfortunately, the hastily implemented system is far from easy to understand and, based on our analysis, it often does a poor job of accurately identifying “quality” facilities. 

The first and most fundamental concern we have with the system is that it uses each state's survey of the home as the basis for the star rating. Unfortunately, the survey as it currently exists is not a measure of quality of care and life in a nursing home. Rather, it measures compliance with process requirements like documentation on resident charts, policies and procedures, and building code requirements.

Further, the CMS Five-Star system counts complaint surveys that are substantiated within the previous 12 months much heavier (half the total score weight) than those that are further back. That means that an abbreviated complaint survey impacts the home's health inspection rating much more than the full annual survey.  Facilities receiving a deficiency-free annual survey but experiencing a one-time serious event would be rated as a one-star home.

Adding to the confusion are the periodic changes of the ratings without any new survey of the facility. Each month, CMS recalibrates the cutoff points for the stars ratings as the average survey score of all facilities changes. As a result, a number of homes' star ratings will change­­­—without a new survey. Our analysis shows a number of Pennsylvania facilities where this has occurred, damaging staff morale, which, of course, impacts quality of care.
Not counting everybody

The second issue relates to the staffing rating, which is misleading. We have identified a number of areas where a facility's staffing rating may not reflect its real commitment to staffing direct care. The rating system doesn't adjust for the use of licensed physical and occupational therapy staff, who are routinely present in facilities that do a lot of rehab care. When those professionals are working with residents each day, there is a lesser need for other staff—a reality not recognized by the CMS system.

Furthermore, facilities that care for a high acuity population are subject to wide swings in ratings, since the system doesn't give them the same level of credit for staffing as it gives a facility with lower acuity residents.  The higher a facility's acuity is, the more difficult it is to achieve a four- or five-star rating on staffing, creating a negative consequence in the form of a disincentive to care for higher acuity residents.

Another component of the staffing formula is the unadjusted monthly national average of reported hours across all homes.  Much like the problems with the monthly change to the overall survey score and star ratings, the system as currently designed may result in a home's staffing rating decreasing without the home making any change to its staffing patterns. We have documented at least one Pennsylvania home where this has happened, and there are likely more.

The system's final domain is based on each home's individual performance on the CMS quality measures. While these measures are useful to individual homes when they assess the success of treatments for individual residents across time, they are not meant to be “compared” from facility to facility.

What began as a well-intended idea to give consumers information on an individual facility's quality has instead turned into an ongoing nightmare for facilities, with little value to consumers. CMS readily admits that data may “change monthly,” which results in a moving target for homes working to achieve a higher rating, and has the potential to penalize homes absent any action on their part.

PANPHA and the national American Association of Homes and Services for the Aging have a shared philosophy that there should be “only two types of nursing homes: the excellent and the non-existent.” The CMS Five-Star system as it is currently composed does nothing to move us in that direction. Worse, we believe that there are a number of very dangerous disincentives for facilities under this rating system because caring for a high-acuity population has the potential to harm a facility's ratings on staffing and quality measures.

It's time for CMS, consumers, and providers to work together to redesign this system in a way that works for both consumers and for those who provide their care.


Mark D. Miller, M.A., is a former executive director who now serves in a policy analyst role as the regulatory affairs manager for the Pennsylvania Association of Non-Profit Homes for the Aging (PANPHA).  The full report prepared by PANPHA can be accessed here