American Healthcare Association Criticizes Biden Proposed Nursing Home Staffing Rule, Seeks Dialogue

Care giver treats hair of nursing home resident at a Quality Life Services facility in western Pennsylvania. Courtesy of the Pennsylvania Health Care Association

After President Joe Biden announced during his 2022 State of The Union Address measures his administration would propose to improve healthcare, the industry has attempted to work with the administration to come to an agreement on guidelines that are beneficial to payments and staff.

Proposed staffing level mandates were released earlier this month and have since received widespread criticism from groups representing nursing homes as well as staff.

The White House says the new initiatives target the safety and quality of care in nursing homes, with the central theme of cracking down on establishments that “chronically understaff their facilities—resulting in poor, substandard care that endangers residents.”

In his State of the Union address last year, Biden said his administration would work to “protect seniors’ lives and life savings by cracking down on nursing homes that commit fraud, endanger patient safety, or prescribe drugs they don’t need.”

In a Tuesday press conference, Mark Parkinson, the President and CEO of the American Health Care Association and National Center for Assisted Living (AHCA/NCAL) and former Democratic Governor of Kansas, voiced serious reservations about the Biden administration’s proposals.

While affirming the organization’s commitment to enhancing care quality and staffing levels, he raised significant concerns that the administration’s proposal could lead to unintended and detrimental consequences for the nation’s nursing homes and criticized the administration for not working closer with the industry prior to the rule proposal.

The Proposed Mandates: A Flawed Approach

The administration’s proposal introduces two key staffing requirements: a mandated minimum of 0.55 hours per patient day for registered nurses, 2.45 hours for nurse aides, and a 24/7 registered nurse (RN) requirement. While the aim of improving care standards is being sought across the board, Mr. Parkinson pointed out two fundamental flaws that could undermine the entire policy.

The first major hurdle highlighted by Mr. Parkinson is the severe shortage of skilled workers in the nursing home sector.

He described the current situation as unparalleled in history, with over 100,000 workers having exited the profession and no signs of them returning.

A resident sits in a wheelchair in his room in a nursing home in Berlin on January 14, 2021, amid the novel coronavirus (Covid-19) pandemic.Photo by Stefanie Loos/AFP via Getty Images

The idea of not only rehiring these lost workers but also recruiting tens of thousands more appears to be a daunting, if not unrealistic, task. Moreover, Mr. Parkinson emphasized the looming demographic challenges that indicate the nursing profession is on a trajectory of continuous loss rather than gain.

The second critical flaw centers on the lack of funding. Nursing homes, particularly those reliant on Medicaid, are already facing severe financial constraints, he said.

Numerous independent studies consistently report negative margins for Medicaid-based skilled nursing facilities. Even the Biden administration’s own estimate acknowledges the substantial cost of implementing the proposed mandates, pegging it at approximately $4 billion per year.

However, Mr. Parkinson cautioned that this figure might be a conservative estimate. Regardless of the exact amount, nursing homes are ill-prepared to shoulder such a financial burden, in his opinion.

Responding to a question from a reporter about potential funding solutions, Mr. Parkinson stressed that the substantial funds required could only come through the Medicaid system.

He emphasized that the government’s statistics indicated that private equity owned less than 5% of nursing homes, dispelling the notion of “greed” often associated with the sector.

A Backward Approach to Policy Development

Mr. Parkinson also criticized the administration’s approach to policy development, asserting that it was backward compared to past administrations.

Instead of conducting comprehensive studies and consulting with healthcare providers before formulating a minimum staffing policy, the current administration announced its policy first and conducted analysis afterward, he said. This unconventional approach, he argued, resulted in a policy lacking a logical and practical foundation.

When asked if litigation was on the table during the press conference, he indicated that, for now, AHCA/NCAL was primarily focused on dialogue with the administration and Congress. He expressed hope that the rulemaking process or Congressional action might lead to positive changes in the proposed policy.

This 2019 Pennsylvania Auditor General's report predicted a deepening nursing home workforce shortage. Beth Brelje/The Epoch Times

In a question from The Epoch Times regarding the administration’s openness to input from AHCA/NCAL, Mr. Parkinson affirmed that there had been an open dialogue with CMS and HHS since the policy was announced in February 2022. However, he acknowledged that discussions before the policy’s announcement might have yielded a more balanced approach.

Comprehensive Analysis by CLA

The press conference included a presentation of findings from Clifton Larson and Allen (CLA), which conducted a thorough analysis (pdf) to gauge the potential impact of the proposed staffing mandates on nursing homes.

Cory Rutledge, Chief Assurance Officer with CLA , said the analysis looked at the 24/7 RN requirement proposal as well as hours per resident per day proposals, and estimated how many additional staff are estimated to be hired.

The results of the study, according to CLA, were that nursing homes would need to hire approximately 102,154 additional full-time employees (FTEs) to meet the proposed staffing requirements, comprising 80,000 nurse aides and 22,000 registered nurses.

The estimated cost of implementing the mandate stands at around $6.8 billion per year, potentially exceeding the administration’s $4 billion projection.

CLA also conducted an analysis of Medicaid census data that revealed nursing homes primarily serving Medicaid-dependent populations were less likely to meet the proposed staffing criteria.

Rutledge said it is important to note that their estimates acknowledged that the proposed rule stipulates that 24/7 RN requirements would be implemented first, and when CLA analyzed the incremental impact of 0.55 rn hours per resident day requirement they assumed a portion of this criteria is met by the additional 24/7 RN coverage.

Real-World Perspectives from Providers

Marie Costa, a provider from Northern Nevada, provided insights into the challenges faced by nursing homes in the current labor market.

She emphasized the difficulty of competing with higher-paying jobs in the region and the crucial role LPNs (Licensed Practical Nurses) play in the care team. Unfortunately, under the proposed mandate, LPN hours do not count, further complicating staffing issues, she explained.

Ms. Costa stressed that the proposed staffing mandate would have severe consequences for seniors who rely on Medicaid. Without adequate funding and support for workforce development, nursing homes would find it exceedingly challenging to attract and retain caregivers.

Monica (L), a nursing assistant and the youngest worker at the residence, and Araceli Hidalgo, 96, a resident of Los Olmos nursing home for the elderly, are the first people to receive the first dose of the covid-19 vaccine in Spain on Dec. 27, 2020, in Guadalajara, Spain. Pepe Zamora/Pool/Getty Images

This, she warned, could lead to potential closures and even more restricted access to care for vulnerable seniors, having the opposite outcome all parties have expressed wanting to see.

Possible Solutions

In his closing remarks, Mr. Parkinson addressed several pressing issues, including the practicality of implementing the proposed policy. He emphasized that CLA’s analysis had confirmed their initial concerns: virtually every facility in the country would be out of compliance at some point due to the enforcement period’s short duration.

To mitigate these concerns, Mr. Parkinson outlined several policy recommendations, such as counting LPNs either in the registered nurse or nurse aide category, extending the phase-in period for all requirements to five years, developing a funding mechanism to support the recruitment and retention of required staff, and addressing various intricacies in the policy that unfairly penalize facilities.

Regarding funding, Mr. Parkinson stressed the necessity of addressing Medicaid’s limitations, suggesting that Congress would need to secure adequate financial resources.

He concluded by reaffirming AHCA/NCAL’s commitment to constructive dialogue with the administration and their unwavering focus on ensuring the well-being of nursing home residents and the sustainability of the sector.