Nursing Homes Mandated to Provide Certain Levels of Staffing Under Final Rule
On April 22, 2024, the Centers for Medicare & Medicaid Services (CMS) released the final rule outlining required nursing home mandatory staffing levels.
Background
In September 2023, CMS released a proposed rule requiring minimum staffing in nursing homes. The release came shortly after a report commissioned by CMS appeared to be inadvertently posted online. The proposal included required staffing of Registered Nurses (RNs) at 0.55 hours per resident day (HPRD) and Nurse Aides (NAs) at 2.45 HPRD. It did not require any licensed practical nurse (LPNs) staffing minimums or total hours minimum. CMS also required a nurse be onsite 24 hours a day, seven days a week. The proposal included some limited exceptions to these requirements and allowed for phasing in these staffing minimums with a longer phase in for nursing homes in rural locations.
The President originally discussed nursing home quality and care, including a minimum staffing standard, in his 2022 State of the Union address. Since then, fierce advocacy on both sides on the mandatory minimum staffing levels has been ongoing. The nursing home industry has strong concerns over the cost of this mandate, lack of sufficient existing staff nationally and the omission of the role LPNs play in nursing homes. CLA had estimated the proposal’s impact at roughly $6.8 billion and staffing to these levels would require an additional 102,000 new RNs and nurse aides.
On April 22, 2024, CMS released the final rule. The rule maintains many of the proposed policies, revises some aspects and add several new policies. The final rule is scheduled to be published in the Federal Register on May 10, 2024, and would generally take effect 60 days after that. Note, there are delayed effective dates for various rule policies as outlined below.
Final Staffing Mandate
With respect to required staffing minimums, CMS finalizes HPRD for two disciplines—Registered Nurses (RNs) at 0.55 HPRD and Nurse Aides (NAs) at 2.45 HPRD. As with the proposed rule, the final rule does not require any LPN staffing minimums. CMS then finalizes a new requirement for a total nursing HPRD of 3.48. CMS expects many facilities will need to staff above the minimum standards to meet the acuity needs of their residents depending on case-mix and as mandated by the facility assessment (detailed later in this blog).
In addition, CMS finalizes the requirement to have an RN on site 24 hours per day, seven days a week. CMS finalized that if the Director of Nursing (DON) is an RN and is available to provide direct resident care, then the DON will count towards this requirement.
CMS indicates that compliance with the 24/7 RN requirement does not simultaneously constitute compliance with the minimum 3.48 HPRD total nurse staffing standard, the 0.55 RN HPRD, or the 2.45 NA HPRD requirements or vice versa.
CMS also indicates there is no federal preemption and that if state or local requirements are higher, those would be required.
| Proposed Rule | Final Rule Requirements |
| No provision | 3.48 total nursing HPRD |
| 2.45 Nurse Aide HPRD | Same |
| 0.55 RN HPRD | Same |
| RN on site 24/7 | Same |
| Required facility assessments | Largely the same with some additions |
| Phase-in timeframes | Largely the same, rural definition revised, facility assessments required in 90 days after rule publication, not 60 days as proposed |
| Hardship Exemptions | Some revisions, waivers added for new policies (24/7 waiver for 8-hours and 3.48 HRRD total) |
Required Facility Assessment Enhancements
The facility assessment requirement is a separate requirement that is designed to ensure that each facility has assessed its resident population to determine the resources, including direct care staff, their competencies, and skill sets, the facility needs to provide the required resident care. If the facility assessment indicates that a higher HPRD for either total nursing staff or an individual nursing category is necessary for “sufficient staffing”, the facility must comply with that determination to satisfy the requirement for sufficient staffing.
CMS finalized:
- Clarifying that evidence-based methods must be used when care planning for residents
- Requiring use of facility assessments to assess specific needs of each resident and adjust as necessary based on any significant changes in resident population
- Requiring input of staff including leadership, management, direct care (nurse staff) representatives of direct care and staff who provide other services
- Requiring development of a staffing plan to maximize recruitment and retention of staff
CMS also adds that “behavioral health issues” must be considered in addition to physical health issues. Finally, CMS states the assessments require the active participation of the nursing home leadership and management including but not limited to, a member of the governing body, the medical director, an administrator, and the director of nursing; and, direct care staff, including but not limited to, RNs, LPNs/LVNs, NAs, and representatives of direct care staff, if applicable. The facility must also solicit and consider input received from residents, resident representatives, and family members.
Hardship Exemptions/Waivers from Staffing Minimums
CMS finalizes exemption/hardship process for the RN HPRD, NA HPRD, total nursing staff HPRD minimums and an exemption from the 24/7 RN mandate. CMS states these exemptions would be available in limited circumstances.
In general, to qualify for an exemption, a facility must meet the following criteria:
- The workforce is unavailable as measured by having a nursing workforce per labor category that is a minimum of 20% below the national average for the applicable nurse staffing type, as calculated by CMS, by using the Bureau of Labor Statistics and Census Bureau data
- The facility is making a good faith effort to hire and retain staff
- The facility provides documentation of its financial commitment to staffing
- The facility posts a notice of its exemption status in a prominent and publicly viewable location in each resident facility
- The facility provides individual notice of its exemption status and the degree to which it is not in compliance with the HPRD requirements to each current and prospective resident, the timeframe during which the exemption applies and reminds residents of their rights to contact advocacy/oversight entities, and sends a copy of the notice to a representative of the Office of the State Long-Term Care Ombudsman
For the 24/7 RN waiver, if this is granted, facilities must have a registered nurse, nurse practitioner, physician assistant, or physician available to respond immediately to telephone calls from the facility. The waiver would apply to 8 hours per day of the 24/7 requirement. CMS intends to post on Care Compare a notice of facility exemption status and the degree to which it is not in compliance with the requirements.
The exemptions/waivers would be in place until the next standard recertification survey.
Some facilities would be ineligible altogether for exemptions, including:
- Facilities failing to submit Payroll-Based Journal (PBJ) data
- Facilities on the special focus facility list
- Facilities identified with widespread insufficient staffing in past 12 months resulting in actual harm or a pattern of insufficient staffing resulting in actual harm or cited with immediate jeopardy for insufficient staffing
Implementation Timeframes
CMS will largely phase in the requirements over three or five years depending on rural or non-rural location.
- Phase 1 (non-rural areas) would have 90 days to comply with facility assessment requirements
- Phase 2 (non-rural areas) would have two years to meet the 3.48 total nursing HPRD and the 24/7 RN on site requirement
- Phase 3 (non-rural areas) would have three years to meet the 0.55 RN and 2.45 NA HPRD requirements
Due to particular concerns for nursing homes, CMS finalizes the following implementation timeframe:
- Phase 1 (rural areas) would have 90 days to comply with facility assessment requirement
- Phase 2 (rural areas) would have three years to meet the 3.48 HPRD and 24/7 RN on site requirement
- Phase 3 (rural areas) would have five years to meet the 0.55 RN and 2.45 NA HPRD requirements
In the final rule, CMS changes its definition of rural based on feedback from the proposed rule. CMS finalizes defining “rural” in accordance with the Office of Management & Budget (OMB) definition. OMB designates counties as Metropolitan (metro), Micropolitan (micro), or neither. “A Metro area contains a core urban area of 50,000 or more population, and a Micro area contains an urban core of at least 10,000 (but less than 50,000) population. All counties that are not part of a Metropolitan Statistical Area (MSA) are considered rural.”
| Noteworthy: Medicaid Institutional Payment Transparency Reporting Not covered in this blog but included in the nursing home staffing mandate final rule are additional provisions related Medicaid Institutional Payment Transparency Reporting. The provisions are designed to promote public transparency related to the percentage of Medicaid payments for services in nursing facilities and ICFs/IID that is spent on compensation to direct care workers and support staff. Further, CMS states these transparency requirements will complement similar requirements in a separate final rule also published on April 22 called the Ensuring Access to Medicaid Services. That rule requires states report to CMS and publicly on the percentage of Medicaid payments, for certain home- and community-based services, that is spent on compensation for direct care workers. This separate rule requires that at least 80% of Medicaid payments for personal care, homemaker and home health aide services be spent on compensation for the direct care workforce (as opposed to administrative overhead or profit) among many other policies. |
Compliance/Enforcement
CMS indicates it will survey facilities for compliance with the updated requirements and enforce them as part of CMS’s existing survey, certification, and enforcement process for facilities. In addition, consistent with the President’s reform plan, CMS states it will display determinations of facility compliance with the minimum staffing standards on Care Compare and require facilities to post a public notice within the facility if they are out of compliance with the standards.
CMS states remedies that may be imposed include, but are not limited to, the termination of the provider agreement, denial of payment for new admissions, and/or civil money penalties. CMS states it anticipates compliance being assessed by using a combination of PBJ data and surveyor review and observations. More details will be released in future rulemaking prior to effective dates.
Of note and in anticipation for any potential lawsuits, CMS states that to the extent a court may enjoin any part of the rule, the Department of Health and Human Services intends that other provisions or parts of provisions should remain in effect. Per CMS, any provision of the final rule held to be invalid or unenforceable by its terms, or as applied to any person or circumstance, shall be construed so as to continue to give maximum effect to the provision permitted by law.
Implementation Cost Per CMS
Without accounting for any exemptions, CMS estimates the overall economic impact for the minimum staffing requirements for facilities (that is, collection of information costs and compliance with the 24/7 RN, facility assessment, and minimum 3.48 total nurse staffing, 0.55 RN, and 2.45 NA HPRD requirements), which includes staggered implementation of the requirements, would result in an estimated cost of approximately $53 million in year 1; $1.43 billion in year 2; $4.4 billion in year 3; with costs increasing to $5.8 billion by year 10. CMS estimates that total cost over 10 years will be $43 billion, which was derived from FY 2021 Worksheet S-3, Part V of the Medicare Cost Report. Facilities are responsible for these costs.
Next Steps
This is a final rule. It takes effect 60 days after publication in the Federal Register, which is scheduled for May 10, 2024. The facility assessment requirements take effect for all nursing homes 90 days after that. This means your facility should begin working on these assessments now. CLA can help.
CLA has been on the forefront of analysis this issue and helping nursing homes across the country prepare for any eventuality. Reach out today if you have questions or we can assist your organization with an operational assessment, market analysis, strategic and facilities planning, reimbursement and minimum data set changes.
Additional Resources
CMS Fact Sheet on final staffing rule
CMS final rule text on minimum staffing levels
Abt 2022 nursing home staffing report
CLA’s 2024 senior living and care trends on navigating the industry landscape
Jennifer Boese is the Director of Health Care Policy at CLA. She is a highly successful public policy, legislative, advocacy and political affairs leader, including working in both the state and federal government as well as the private sector. She brings over 20 years of government relations and public policy knowledge with her to CLA. Well over half of her career has been spent dedicated to health care policy and the health care industry, affording her a deep understanding of the health care market and environment, health care organizations and health care stakeholders. Her role at CLA is to provide thought leadership, policy analysis and strategic insights to health care providers across the continuum related to the industry's ongoing transformation towards value. A key focus of that work is on market innovations and emerging payment models. Her goal is to help CLA clients navigate and thrive in an increasingly dynamic health care environment.