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Cutting off Nursing Home Funding Is Not Just a Veiled Threat

A couple of months ago, Tennessee state authorities investigated a nursing home in Memphis that has been a repeat offender of nursing home regulations, and is rated with only one star out of five on the federal government’s rating scale, the details of which are also published on Medicare’s Nursing Home Compare website. As reported by local news in February, the home’s prior August 2013 survey alone cited 14 deficiencies ranging from providing inadequate or improper nutrition to errors with medications to evidence of expired food still hanging around the kitchen. There was also a report that a patient was deprived of prescribed morphine (pain medication) by staff, causing the patient tremendous harm. State authorities spent what was characterized as an unusually long amount of time (weeks) surveying the facility to follow up on patient complaints and presumably to ensure that known errors were fixed and that the facility was generally up to code.

Now, after months of complaints and extended surveying by authorities, the nursing home will lose its federal funding as the federal government will no longer reimburse for care and treatments provided (or ostensibly provided) by the facility to patients. As a result, those patients had to be moved to other facilities so they can continue to receive care that can be paid for with federal funds through programs like Medicare and Medicaid. The Centers for Medicare and Medicaid Services (CMS), which administers those programs under the auspices of the U.S. Department of Health and Human Services, indicated it would officially cut off the funds as of April 11, 2015.

Rather than face fines, the facility will actually be losing a presumably significant part of its business since so many nursing homes enjoy profits because many of their patients are insured through Medicare and Medicaid. The facility owner’s media relations manager was quoted in the press as confirming that the halt to funding is in direct response to the investigation of the facility. Only when the deficiencies are fixed can the facility appeal to have its funding restored so that it can bring back government-insured residents. It is unclear where all of the moved residents ended up, though the nursing home owned facing discipline apparently offered to pay for relocation to other facilities, including ones owned by that same entity.

While this is an unfortunate issue for the residents of that Memphis nursing home, it is at least encouraging that the state and federal governments here responded to complaints and concerns, and conducted a lengthy investigation. And in addition to merely finding the facility and threatening it with closure or a withholding of funds if it failed to come back into compliance, CMS actually made good on that very threat and moved to cut off the flow of taxpayer dollars to the nursing home until it can demonstrate it is in compliance with relevant laws and regulation. While moving residents must be woefully inconvenient for those individuals, it is important to ensure they get proper care, and secondarily that a nursing home is not reaping profits from taxpayer money when it is apparently not meetings its own obligations to earn that money.

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