10 Steps to Reform and Improve Nursing Homes

When COVID-19 struck late last winter, long-term care facilities were already flailing. Eighty-two percent had been cited in one or more recent years for such deficiencies as improper hand hygiene and not isolating sick residents or not using personal protective equipment (PPE) during an outbreak, a May 2020 report from the U.S. Government Accountability Office (GAO) revealed. Our nation's oldest and most vulnerable citizens were catching as many as an estimated 3.8 million infections a year, and 388,000 were dying, according to the U.S. Centers for Medicare & Medicaid Services.

"Every nursing home should stockpile PPE, not just for this but for other kinds of contagious events that can happen,” says Patricia McGinnis, executive director of California Advocates for Nursing Home Reform.

California, New Jersey and New York recently mandated that nursing homes amass one to two months’ worth of masks, gloves, face shields, goggles, gowns and other protective gear. But that isn't cheap. A University of California, Berkeley, Labor Center analysis shows that setting aside 90 days’ worth of PPE per 1 million health care workers would cost $50 million, although advocates point out that it would save lives and lead to lower treatment costs.

4. Reduce isolation

"Social isolation has been a mental and physical health problem in nursing homes long before COVID-19,” says Bei Wu, director for research at the Hartford Institute for Geriatric Nursing at New York University. Lack of connection, Wu says, is associated with a litany of consequences, including a 50 percent higher risk of dementia, 29 percent higher risk of coronary heart disease events and 32 percent higher risk of stroke. “Any plan for improving nursing home quality of care has to address isolation,” she says.

A first step would expand virtual visits. Video chats with friends and family were associated with a 50 percent lower risk of depression compared with emails, social media or instant messaging, in a 2019 Oregon Health and Science University study of 1,424 older adults. The federal government recently provided grants of up to $3,000 per facility for such equipment. “It works great if you have a small facility and you only need like three iPads. But if you have 100 people and you need 10 to 15 iPads, it's probably not sufficient,” says Teresa Holt, the director of the AARP Alaska office and the state's former long-term care ombudsman, who wants to raise the $3,000 ceiling for larger operations.

The next step is to create “safe rooms” for in-person visits. Those would include plexiglass walls, a sound system, antimicrobial surfaces and maybe even a “hug wall” made of flexible material for germ-free embraces.

Goal: Reexamine Business Approaches

5. Address the funding

Medicaid, the public health insurance program primarily for low-income Americans, covers nursing home bills for more than 60 percent of residents. Yet the program, which is funded jointly by states and the federal government, reimburses nursing homes for roughly 70 percent to 80 percent of the costs of caring for residents. To compensate, many nursing homes say they must rely on diversifying their business by bringing in higher-paying short-term residents — for example, those needing rehabilitation after a surgery. “Providers were already operating on razor-thin margins before the pandemic hit due to chronic Medicaid underfunding,” says Mark Parkinson, president and CEO of the American Health Care Association and the National Center for Assisted Living.

Nursing home industry groups are lobbying for legislation adjusting Medicaid reimbursement rates to fund what they say are the actual costs of care. A conservative, back-of-the-envelope equation suggests it would cost another $15 billion a year.

A similar potential solution is to create a new Medicare benefit, a “Part E,” that would cover most or all of older Americans’ long-term care costs, Kramer says. This would blend higher Medicare payments and lower Medicaid rates into a single payment stream to nursing homes.

But money isn't the only issue, notes David Grabowski, a professor of health care policy at Harvard Medical School. “I don't want to pay more for what we are getting now,” he says. He advocates tying additional funding to redesigning nursing homes so they feel more like real homes and less like institutions.

Grabowski also says there are state funding fixes available, such as mandated public long-term care insurance programs. Washington state instituted such a program in 2019, funded through payroll deductions, similar to Social Security and Medicare, and will provide a lifetime benefit of $36,500 to those who meet the eligibility requirements. It is projected to save the state upward of $440 million in Medicaid spending by 2050, according to state Rep. Laurie Jinkins (D), speaker of the Washington state House of Representatives.

6. Revamp the staffing model

A nursing home aide can be responsible for more than 20 residents on a shift. The job is physically and emotionally demanding, and lives can be at stake, yet the average wage is around $13 an hour.

Requirements for the job vary by state. In most, workers complete a hands-on training course and a certified nursing assistant (CNA) program, which generally take from 75 hours of training to more than three months. But don't be fooled by the terminology. State requirements to gain a hairstylist license are more demanding than for a CNA, says Lori Porter, cofounder and CEO of the National Association of Health Care Assistants. Now that COVID-19 restrictions have limited CNAs to working at just one facility, many are unable to afford basic living expenses.

Researchers at UCLA and Yale University found that nursing home aides who worked in multiple facilities in order to make more money contributed to the spread of COVID-19. Restricting workers to a single facility had the potential to reduce COVID-19 infections by 44 percent, according to the study.

But given the low-pay, high-stress nature of the work, there is a chronic shortage of workers to draw on, notes April Verrett, president of the Service Employees International Union (SEIU) Local 2015 based in Los Angeles, which represents about 420,000 long-term care workers across the state. Without increased pay and benefits, nursing homes will remain short-staffed, Verrett says. “We have seen during this outbreak that staffing is so stretched that they hardly have time to wash their hands and make sure their protective equipment is on properly,” she adds.

7. Improve oversight and reporting

On paper, the rules and regulations for operating a safe and sound long-term care facility are detailed and strict. The problem, advocates for nursing home residents say, is these laws and regulations are not strictly enforced.

Take the case of the Pontiac Nursing Home. In April 2019, the for-profit facility in Oswego, New York, was cited by state inspectors for “immediate jeopardy,” the most serious violation, after an employee declined to send a resident with a temperature of 104.4 degrees to the emergency room. The man died. An inspection revealed that a second man died after employees waited 11 hours to send him to an ER while he struggled to breathe. The federal government fined Pontiac $21,393. Mollot notes that it's cheaper to pay the fines and “continue business as usual instead of making improvements to quality of care.”

Sen. Bob Casey, a Democrat representing Pennsylvania and the ranking member of the Special Committee on Aging, says that COVID-19 has “supercharged” the need to root out nursing homes that are failing seniors. Casey and Sen. Pat Toomey, a Republican representing Pennsylvania, introduced new legislation that aims to hold nursing homes more accountable. Casey says the bill, which AARP supports, would “transform the oversight process for nursing homes that have consistently failed safety and care standards."

8. Rethink ownership

About 70 percent of nursing homes are for profit, and many are part of large, complex and often opaque organizations.

"Regulate nursing homes like a utility so that we know exactly where the money goes,” says Charlene Harrington, professor emerita and a nursing home researcher at the University of California, San Francisco. “Only a certain amount could go for profits, and the rest would have to go for services."

Even better, Harrington argues, would be ending the for-profit ownership model that dominates the industry — especially the private-equity investment model of flipping properties for big, fast returns.

Goal: Reshape the Industry

9. Provide more care at home

Innovative nursing home alternatives that have been cropping up across the U.S. are getting new attention as Americans question nursing homes as the default model of care. “Until recently we've chosen as a society not to really see nursing homes until we need them. Then we're surprised, shocked and appalled by the conditions and the facilities,” says Terry Fulmer, president of the New York City-based John A. Hartford Foundation, an organization dedicated to improving care for older adults. “In their current state, they're overregulated, underfunded and have low societal respect,” she says.

Nearly 1 in 8 nursing home residents were considered “low care” in a recent study by the Providence (Rhode Island) VA Medical Center that looked at 2014 data from around the U.S. These residents needed some help with daily living but didn't have complex medical or rehab needs and could independently eat, use the bathroom, stand up from a chair and get in and out of bed. The solution may be extending home care services, says Nora Super, senior director of the Milken Institute Center for the Future of Aging. State programs that allow Medicaid funds to be used not just for nursing homes but also for home care allowed more than 100,0000 people to move out of nursing homes between 2008 and 2019.

Medicaid's program, called Money Follows the Person, costs about $882 million a year but must be reauthorized every five years by Congress. “Permanently reauthorizing the MFP program will reduce Medicaid's institutional bias toward nursing facilities,” Super says.

10. Create smaller nursing homes

Too often, nursing homes look, feel and function like hospitals. Susan Ryan, senior director of the Green House Project, says small, family-like households are a better option.

At 300 Green Houses in 32 states, just 10 to 12 residents live in a housing center and share an open kitchen, dining room and living room. Specially trained CNAs work exclusively in one house — making meals, doing laundry, socializing, helping residents pursue their interests and looking for early signs of health issues. “COVID-19 rates have been far lower in small nursing homes,” Ryan says. “All the features that make them a great place to live also make infection prevention and control easier.” One 2016 study comparing costs at 15 Green Houses to 223 conventional nursing homes found that Medicare Part A costs for hospitalizations were about 30 percent lower — $7,746 less- — for a Green House resident.

Super notes that small nursing homes may gain traction as operators of nursing homes confront the need to upgrade their facilities. “At a certain point,” she says, “it's easier to rebuild than to renovate."