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Office of the Press Secretary

For Immediate Release July 21, 1998
                            PRESS BRIEFING

The Briefing Room

1:10 P.M. EDT

MR. TOIV: Good afternoon. A reminder -- this is an embargoed briefing. This briefing is embargoed until 3:00 p.m.

Q It better be a blockbuster. (Laughter.)

MR. TOIV: Oh, it will be, Helen. It will be. As you all know, the President will be making some announcements today with respect to nursing homes. And here to brief on the announcement are the Secretary of Health and Human Services Donna Shalala, and the Administrator of the Health Care Financing Administration Nancy Ann DeParle.

SECRETARY SHALALA: Good afternoon. Actually, after what Helen said, let me start with a story about my mother, who is 86 and a full-time attorney and represents a number of clients who are in nursing homes. And she regularly says, Donna, I don't care whether they're good nursing homes or bad nursing homes, you have to watch them like a hawk. That's our message for today.

Later this afternoon the President will announce a very strong new initiative to further protect the health and safety of people in nursing homes. One point six Americans are in nursing homes today, so it's important that Congress acts quickly. And some of our recommendations to the President are administrative that we're going to put in place ourselves, that we have the authority to do under existing law, and others require new legislation.

98And it's very important for our future and let me give you one statistic. By the year 2000 the number of elderly Americans in this country will exceed the number of children for the first time in American history. And the number of Americans over the age of 85, those most likely to need nursing home care, will double by the year 2030. So nursing homes are a critical part of our health care system and the quality of them is important to every family in this country.

Our new initiative builds on a very strong record that we now have made, making sure that those who get long-term care get high-quality care. In 1995, over the objections of many people in the nursing home industry and in Congress, we adopted the toughest measures in history to monitor and enforce nursing home quality standards. You remember, in the late 1980s there were nursing home scandals; Congress enacted a law. That law languished until the beginning of the Clinton administration. We wrote the regulations based on that law and asserted the federal oversight over the nursing home industry in the strongest set of regulations ever proposed.

We have aggressively enforced those regulations, but continue to monitor the system. And when we announce those regulations, we said we were putting an ongoing evaluation system in place, and that, unlike other kinds of regulations and other things the government does, we are not simply going to lock a set of regulations in stone, we were going to design a system so we would continuously improve the regulations.

This is the first shot that we've had at taking the basic regulations that we've put in place and to make a series of regulations based on experience, not based on theory, but based on experience to improve those regulations in our oversight.

The initiative that the President is going to announce today strengthens the health care financing administration's enforcement and oversight. Nancy DeParle is going to give you the details, but let me give you some examples of it. We intend to improve the state's ability to carry out their responsibility to conduct on-site inspections. The federal government does the regulations; the states basically administer and do the inspections of nursing homes. It is a state employee that's basically walking in to a nursing home to inspect them.

But let me give you some examples of things that we've found that we need to change. We found that the inspections are too predictable. If you were inspected on Monday a year ago, the chances are pretty good that you're going to be inspected a year later on a Monday. There are almost no inspections -- and the inspections are supposed to be a surprise, but the way in which some states have designed their systems, they inspect every year but they tend not to vary the time or the date every year. So what we have said is you've got to do it on weekends, you've got to do it in the evenings, and you've got to have a much more random system so people are genuinely surprised. So we're directing the states to conduct more inspections at night and on weekends and vary clearly the day of the week when they're inspecting so someone can't anticipate this is the week in which a state inspector is going to walk in.

We have new incentives for nursing homes to fix their problems early rather than waiting to be caught and penalized. And Nancy Ann is going to talk about these penalties being imposed faster so that they are, in fact, an incentive to fix something, as opposed to waiting until the end of the time and then fixing whatever needs to be fixed.

Again let me say that all of this comes out of a huge report that we've sent to Congress. It's 900 pages long. We didn't think you'd want to see every page of it, but we will detail our findings. Let me also say that the report also indicates that we have reduced many problems that we saw in nursing homes in the 1980s, out of the new regulations. So what we're fixing is things that weren't fixed in the original regulations or things we've learned. In this case, all of our recommendations are based on practical experience in the field and the result of a series of public sessions that Nancy * conducted to listen to what people who have patients in nursing homes, people who are working with nursing home patients say about how our regulations are working.

I've noted already that we're sending a report to Congress on a number of issues. On the final issue, the Congress asked us to do an experiment to test whether private accreditation would be better than basically the old-fashioned way in which we do inspections -- having a state inspector walk into a nursing home. So we did, in fact, have the private accreditation agency walk in and took a look at their report and had a state inspector also walk in and took a look at his or her report. We have concluded that private accreditation organizations would actually put nursing home residents in jeopardy. They are not tough enough, they miss a lot of things, and we are telling Congress formally now that we will not allow private accreditation agencies to substitute for state reviews of the nursing homes. We've learned a lot out of that experience, we put no one in jeopardy at the same time, but at least the myth that a private accreditation system could substitute for state -- for well-trained state inspectors is now over with and we're making a recommendation to Congress in that area.

Now, let me introduce my colleague to walk you through the pieces of paper. If you don't have the pieces of paper, we'll get them to you.

Q -- in Congress to implement that last point you made?

SECRETARY SHALALA: I think Congress just needed a recommendation from me. They wanted us to test whether private accreditation agencies could substitute for state inspectors. We tested it, and our answer is, no, they cannot, they miss too much, and they actually put nursing home residents in jeopardy.

Q Well, any such private agencies operating today, which are now saying cannot in the future?

SECRETARY SHALALA: No, this is the private accreditation agency for nursing homes. We are saying that we tried that experiment and we are concluding, based on that experience, that we should continue with well-trained state inspectors.

Let me have Nancy Ann lead you through all the detail.

Q You'll come back to questions?

SECRETARY SHALALA: Yes, absolutely.

MS. DEPARLE: What I'll do is just walk through the initiatives.

Q You know as much as she knows about this. You're just allowing her to move into the sun.

SECRETARY SHALALA: That's right, Sam.

MS. DEPARLE: That's exactly right. That's exactly right.

We're here today because we're submitting a report to Congress on nursing home care and the status of it right now. We were specifically asked by the appropriators in 1996 to look at the issue of whether or not we should allow private accreditation agencies to basically take over the function that the federal government and the states had been performing and what -- we hired an outside consultant to look into that.

As the Secretary said, we have a voluminous report that we're submitting today. The answer to that question is decidedly no. In fact, the outside consultant found -- and we agreed with this finding -- that granting what's called "deeming authority" to an outside group would, in fact, place nursing home residents at a serious risk.

We went on, as part of the report, to look at and evaluate, as the Secretary said, what the current status of our enforcement and the state's enforcement efforts were. And we found that there have been some improvements since the law was enacted and since we put out the toughest regulations ever in 1995, but that we needed to do more to improve our efforts. And we're going to do that and that's what we're announcing today.

A few of the items do require congressional action, but most of them do not. Most of them are things that we can do ourselves. And I'm just going to walk through them quickly. They mainly fall in two main categories. One is stronger enforcement actions and the other is stronger federal oversight.

We are going to toughen the enforcement of nursing home safety and quality regulations by first ensuring that nursing homes found guilty of a second offense for violations that cause harm to residents will have sanctions imposed and will not receive a grace period that allows them to correct problems and avoid penalties. That is a situation that we found in our own evaluation and that we needed to tighten up the definition of what is called a poor performer so that, in cases where there is harm to residents, that they will get immediate sanctions. We think that immediate sanctions will give the nursing homes the incentive that they need to comply in the first place and that's what we want to do.

SECRETARY SHALALA: -- financial sanctions.

MS. DEPARLE: Exactly.

SECRETARY SHALALA: It's going to cost them money.

Q They'll get the message.

MS. DEPARLE: Secondly, we're going to permit states -- well, there's a range of sanctions which can include telling them that they can't admit anymore Medicare or Medicaid residents, which is quite a lot. We're spending right now around $30 billion annually in the Medicare and Medicaid programs, paying for nursing home care. So that gives you some idea. There are 17,000 nursing homes, that gives you some idea of the kind of funds that are at stake here.

We will also permit states to impose civil monetary penalties for each instance of a serious or chronic violation. In the past, these penalties have been linked to the number of days a facility was out of compliance and from what we've seen and from our experience, this has allowed some of the facilities to get away with going on longer without correcting problems that could harm residents.

We are going to require states to conduct nursing home inspections more frequently for repeat offenders with serious violations. As the Secretary said, we're going to stagger nursing home inspection times and have a set proportion of them that have to be done on the evenings and weekends, and that was something that we heard repeatedly from meeting with residents and from talking to actually people who run nursing homes, that there is a lot of predictability in the way that states do their surveys now about when they're going to be showing up and in some areas, they can even tell by who has checked into the local hotel or motel. So we're trying to make sure that we're there at times when residents are likely to be maybe not being watched as closely as they should be.

We're also going to focus enforcement efforts on chains, nursing home chains that have a history of poor performance and noncompliance with federal rules. We are going to impose stronger federal oversight, and that means, first of all, that we'll provide additional training to inspectors in states that aren't adequately protecting residents, but secondly if a state isn't able to improve its operations and do a better job, we will remove their funding to conduct the survey and certification program, and we will contract with other entities to perform these survey and certification activities of nursing homes in those states. So that is something that we have not done before.

We're going to step up our review of a few areas of patient care that we found particularly troubling, and those are: the incidents of bed sores, dehydration and malnutrition, all of which can be prevented through proper care. The way we're going to do that is in several ways. One is that we are going to change our sampling methodology so that we're able to focus more in, in the surveys on these areas and make sure that we're finding those deficiencies and that the nursing homes are being appropriately fined or sanctioned if there are deficiencies. We're also going to work with the Administration on Aging and the American Dietetics Association and clinicians to develop a repository of best practices for residents at risk of weight loss and dehydration.

And we're going to ask Congress to give us the authority to allow more types of nursing home employees with the proper training to perform crucial nutrition and hydration functions.

We are going to change the survey in another way, to require the inspectors to look at each nursing home system to prevent, identify and stop physical and verbal abuse and neglect. That hasn't been a part of the surveys in the past. We're going to require each nursing home to have its abuse prevention plan and present it and give it to the residents and families, so that they know what the plan is at that agency.

And we're also going to ask Congress for the authority to establish a national registry of nursing home employees who have been convicted of abusing residents. And we'll require nursing homes to conduct criminal background checks on all potential personnel.

We will also be working with the HHS Inspector General and the Department of Justice to ensure that state survey agencies and others -- and HCFA -- are making referrals of appropriate cases to the Department of Justice for prosecution under federal, civil and criminal statutes. Some of you may be familiar with the case in Pennsylvania that was prosecuted in the past year.

We will be publishing for the first time ever nursing home survey results and violation records on the Internet. Right now, under current law, the nursing homes are required -- if you go in a nursing home, they're required to post the results of their last survey. I was just in one yesterday and sometimes it can be rather elliptical. That won't be the case anymore because we'll be putting it on the Internet so that families will be able to see not only the results of the nursing home that their loved one might be in, but also the results of other nursing homes in the area. And we think it will help them to be better consumers.

And we are continuing development of some of the things that we started several years ago. One particular item is called the minimum data set which is a national automated data system which will give us more information that will help us improve our surveys, I think.

Finally, I've mentioned two areas we're going to ask Congress to help us in: the national registry of nursing home employees convicted of abusing residents and in allowing more types of nursing home employees, with proper training, to help with nutrition and hydration. The final thing we're going to ask for their help in -- and I think the Secretary mentioned this -- is on the Administration on Aging Ombudsman's Act, the Older Americans Act. That act needs to be reauthorized this year. The ombudsman has been a crucial source of assistance to nursing home residents and to the surveyors and to us in finding out what's really going on in nursing homes. And we think it's essential that a strong ombudsman program be reauthorized and continued.

SECRETARY SHALALA: I think the summary is we're going to be quicker, tougher, more transparent so the public has more information about what's going on. I should emphasize, too, and the report reveals this, that a lot of things have been cleaned up -- the stories about people in restraints, for instance. We found much less incidents of people being put inappropriately in restraints, much less misuse of drugs, for example. So some things out of the first set of tough regulations have been cleaned up. What we're doing with the second set of recommendation is tightening up on the basis of what we've learned over the last three years.

Q When you released the regs in '94 you introduced this concept of substantial compliance, and I think a year later you had reported that a surprisingly low number of nursing homes were, in fact, in substantial compliance with the regs. Where does that stand now? How many nursing homes are in compliance with the regs?

MS. DEPARLE: I believe it's improved, but the important thing that we're talking about today is that we're going to tighten up and, in fact, expand the definition of poor performer, so that more nursing homes that are out of compliance get immediate sanctions. And we thing that by imposing a regime of immediate sanctions they will have a greater incentive to be in compliance in the first place. So we think we're making improvements in that.

Q What's it going to take to be tagged as a poor performer?

MS. DEPARLE: It will take having any incident of actual harm at the current survey, plus it's basically a second offense. In the past it's been that you had to be classified as a substandard provider -- substandard care. And that was a much tougher standard to reach.

Q How many nursing homes are poor performers now and how many are in compliance with the regulations?

MS. DEPARLE: One reason why we're making this change is because in our experience, very few of the facilities were being classified as poor performers --


MS. DEPARLE: And it did not comport with what we understood and from our own evaluation thought was going on out there. So this will significantly increase the number of poor performers that we believe are out there and that will --

Q So how many do you have now and how many would you anticipate having under the new system?

MS. DEPARLE: I don't know the exact number, but I think the number of poor performers was around 1 percent of the nursing homes. And my understanding is this will double or triple it.

Q What are family members going to be able to learn by going on the Internet, and how soon do you expect to have that up, and how comprehensive is it going to be?

MS. DEPARLE: My goal is to have it up by the end of the year, and it will have the entire survey result on it, so it will be very comprehensive. And what they will learn --

Q What's the entire --

MS. DEPARLE: Well, it's a number of pages, and what they will learn from it, I hope, is that it goes into patient care in a number of different domains -- nutrition, are there rodents in the place, are people getting enough food, are there incidents of bedsores.

SECRETARY SHALALA: It will have a front piece on it that will help people to understand what they're reading, but it will be as clear and transparent as we can possibly make it so that people understand what kind of sanctions and how quickly that nursing home has responded.

Q Can you respond to critics who say that you convened this press conference today in advance of Senator Grassley releasing a report from the GAO that took a look at HCFA and actually found -- it is supposedly supposed to be a very scathing report of how HCFA has dealt with nursing homes.

SECRETARY SHALALA: First of all, this 900-page report, which is ready now we've been working on since December, I guess, when you --

MS. DEPARLE: Well, it's actually been over a year.

SECRETARY SHALALA: The consultants started a year ago, so we -- number one, this report is more comprehensive, covers more areas, including more areas of criticism and has a full response from the department. We have seen the first draft of the GAO report, and we'll be at the hearing responding. But what you will see in our response to our own report is that we'll have covered those areas plus considerably more, because we've done ongoing evaluation and expected to have a series of recommendations.

We are not surprised, after putting the first set of regulations in place, that we now have to improve upon them. That was part of the strategy. And it's a very different way of managing major oversight roles. It's not just putting regs in places, as I said before, and then not coming back and taking a look at them; it's the assumption that we'll be making corrections all along, and that's the system that we designed from the beginning. It's also the system we announced at the time.

Q It's been reported that about a half dozen states have cited virtually no nursing homes for substandard quality of care. Can you tell us any of those states?

MS. DEPARLE: You know, I wouldn't want to do that because I might not get it right. I believe that New York is one of them. And I stated that the other day and someone said, well, it isn't none, it's almost none. It's certainly the case that there are about a half dozen states with virtually none. That is one of the things we're going to be looking at and working with the states on.

It is difficult to believe that there are no nursing homes who meet that standard in those states. The whole nature of the law and of these regulations and of what the Secretary and I are talking about today is continuous improvement. We're not going to be satisfied until we continue to move forward and make improvements here. And it's hard to believe that there are no nursing homes that are substandard in those states.

Q Following up on that, there was a question when the regulations went into effect as to whether the states had adequately trained their inspectors and whether they had enough inspectors to do that. Is that a part of this whole question --

SECRETARY SHALALA: There certainly are recommendations here on improving the training of state inspectors. And we have made recommendations over the years in terms of funding levels in these areas. So given what we've found, I'm not surprised that we're recommending now that we go back and do some additional training, but also be clearer and quicker in our response to problems that are identified and much more transparent.

Q What's the problem with the training, though -- I mean, what are the problems?

MS. DEPARLE: Well, we've done a lot of training since those initial regulations were put out. In fact, we do training almost every month with states and have through Picturetele, training that way, if not on the ground. And so I'm not sure there's as much a problem with that now as there is just in -- that we need to tighten up and sharpen our definitions and be clear with the states that they should be doing this kind of enforcement.

SECRETARY SHALALA: They certainly were better than the accreditation people.

Q Secretary Shalala, given these statistics that you cited at the top of the briefing about the aging, the baby boom generation, is the nursing home industry, as it's constituted now, going to be able to keep up with the challenges it's going to face for quality care and the kinds of care that you all are trying to enforce with these announcements today?

SECRETARY SHALALA: What we're saying today is for the part of long-term care that the nursing industry takes responsibility for. It must be a quality system. But we are not assuming that it's the nursing home industry that is going to solve the long-term care problem in the United States. That requires a much more sophisticated system that includes alternative living arrangements, home care. And the administration is in the process -- in fact, we're in the process of doing an internal review of a long-term care strategy in which nursing homes certainly are a part.

The issue here is quality, and we're not willing to put up with a bunch of outlayers that aren't in a quality system, and we're not willing to put up with any slowness in correcting problems in this new set of regulations that we're putting in place.

Q A related question. Are you planning at this point to apply these regulations to any other form of long-term care such as assisted living? Or are you looking into that at all?

MS. DEPARLE: We don't really regulate assisted living. The federal government --

Q That's something you're not considering at all right now?

MS. DEPARLE: Not at this point.


Q You said that you are going to increase federal oversights of state inspectors with the possibility I gather of taking away their ability to inspect. Who would do it, if not the state? And can you give us some examples?

SECRETARY SHALALA: We would have to contract out -- it could be another state, for example -- but we would have to contract out for that service. If a state demonstrated that it could not fulfill this function, we would have to contract out with another state, with a private contractor that had well-trained personnel, but it would have to be an alternative that put a system in place pretty quickly.

Q And are the states that have virtually no nursing homes cited as substandard -- are those the states at risk of having this happen to them?

MS. DEPARLE: Well, as I said, that's something that we want to look at, but there are also situations that we found in our evaluation where in some states, the people were changing the surveyors' results to make a nursing home look better.

Q People like state inspectors, or who?

MS. DEPARLE: Other people in the hierarchy. That's something that I also want to take a look at. So I don't want to say right now that I have in mind a certain kind of a state; I just know that this isn't working as well as it could, and we can do better and we're going to do that. Part of the responsibility lies with the states.

SECRETARY SHALALA: Let me also say that we have asked the Inspector General, working with the Health Care Financing Administration and the Justice Department to make sure that they are providing much more vigorous oversight, particularly at the multiple offenders in particular. So the law enforcement piece of this is a very critical piece.

But the whole message should be, we put tough regulations in place, they're not tough enough for the standards that this administration has, and we're going to add or change requirements so that we get the quality that we think the clients deserve.

Q HCFA announced a few weeks ago that it intended to delay some nursing home services because of the need to comply with the year 2000 problem.

MS. DEPARLE: Paula, what that was, was there was a requirement under the Balanced Budget Act that we implement a prospective payment system for skilled nursing facilities, which we did on June 1 of this year. There is one piece of that, that is not a service to residents, but it has to do with consolidated billing, which is just a way that they do their bills, and that involves some complicated systems changes that we are delaying until we finish our year 2000 computer renovation work. But it has nothing to do with resident care. And in fact, I think most of the nursing homes are glad to have the extra time to get their systems up and running.

Q Nancy, is Maryland -- are Maryland, Virginia or the District on this no problem list? And for the Secretary, if the federal government can --

MS. DEPARLE: I don't believe so.

Q If the federal government can contract out for these inspections, why are you telling the states they can't?

SECRETARY SHALALA: Because the law is written that basically says that if they're not in compliance, we have the authority to contract out. The law is not written in a way in which the state's could --

MS. DEPARLE: And importantly, if we contracted out it would be using our process. What I think our report and the associate's report today shows is that they went into 179 nursing homes in a number of states, and they had two duplicate processes going on: the inspection process of that state following the HCFA protocol and the deeming -- the joint-commission approach. And in more than half of the cases, the state inspectors found more serious problems than did the outside contractors. So if we were forced to do this -- which we don't want to do, we would prefer to have the state's doing the job that they need to do -- but if we were forced to do it, they would use our protocol.

SECRETARY SHALALA: We have every reason to believe that what we're going to put in place and what we're recommending to Congress will help the states to do their job better. There are a lot of frustrated people out there who would like to give a penalty faster to a second offender, who would like to make the system more transparent. And this is supportive of people that believe now, after seeing the effect of the first set of tough regulations, that we need some improvements.

Q This is a question on the statistics. The 1.6 million people you referred to at the outset, are those all over 65, or what's the breakdown?

SECRETARY SHALALA: No, they may be disabled, too, because the nursing homes in this country also have some disabled. But the vast majority are senior citizens. They may be severely disabled, too, because the Medicaid system covers both.

Q I believe most of the nursing homes in America are private, and how much money does the nursing home get for each patient?

MS. DEPARLE: I can't give you that number. I've said at the beginning the aggregate number is that for Medicare and Medicaid, the federal government spends around $30 billion a year on nursing home care, and that doesn't include the amount the states spend or the private-pay patients.

Q Can you give us a sense of the scope of the problem, what you anticipate you'll find? You mentioned dehydration and bed sores, but can you give us an idea of what you think will come of this greater enforcement?

SECRETARY SHALALA: Part of the point is to get the corrections faster. It's not that the corrections necessarily aren't being made, but that some nursing homes may be waiting until exactly the last legal moment. We think the corrections ought to be made immediately if they're serious enough so that someone identified them. So that clearly is possible, and we've identified some things, including nutrition and bed sores that are related to the quality of care that we think we'll get some improvement on if we get a quicker turnaround.

Q Of the 1.6 million people in nursing homes, how many are there with the federal government paying their expenses?

MS. DEPARLE: I don't know the answer to that. I'll have to get back to you.

SECRETARY SHALALA: It's a pretty high percentage.

MS. DEPARLE: It's a very high percentage.

SECRETARY SHALALA: It's a very high percentage. And it's a particular high percentage of people over 85 that end up on Medicare. Because remember, if I can remind everybody, as we get older, we get poorer.

Thank you very much.

END 1:38 P.M. EDT