AG Nessel Addresses Long-Term Care Executive Order Violations
Yesterday, August 6, 2020 Attorney General (AG) Dana Nessel issued a press release sharing her intent to enforce Executive Order 2020-148. EO 2020-148 outlines protections for residents at long-term care facilities, with requirements that include prohibiting communal dining and communal activities, barring evictions for non-payment, staff access to Personal Protective Equipment (PPE) as well as appropriate measures for sanitation.
Enforcement of EO 2020-148 will be a coordinated effort between the AG's office, the Michigan Department of Health & Human Services (MDHHS), and the Michigan Department of Licensing & Regulatory Affairs (LARA). Willful violations of the EO are considered to be a misdemeanor and carry a $500 fine and/or 90-day jail time.
AHCA/NCAL Financial Survey - Your Input is Needed
AHCA/NCAL is conducting an online survey of skilled nursing, assisted living and ID/DD members for information on the financial impact of COVID-19. Information from this survey will help AHCA/NCAL address questions from policymakers and advocate for ongoing resources to the profession.
Thank you for taking a few minutes of your time and completing the survey by Monday, August 10.
SNF Provider Preview Reports Now Available - New Measures Added to Nursing Home Compare
Skilled Nursing Facility (SNF) Provider Preview Reports have been updated by the Centers for Medicare & Medicaid Services (CMS) and are now available. You can find your reports in the QIES Report Folder. The data contained within the Preview Reports is based on quality data submitted by SNFs between Q1 2019 - Q4 2019 (1/01/19 - 12/31/19) (for assessment-based measures) and Q4 2017 and Q3 2019 (10/01/17 - 9/30/19) (for claims-based measures). The data reflects what will be published on Nursing Home Compare during the October 2020 refresh of the website. Providers have until August 30, 2020 to review their performance data. Corrections to the underlying data will not be permitted during this time; however, providers can request CMS review of their data during the preview period if they believe the quality measure scores that are displayed within their Preview Reports are inaccurate.
Beginning with the October 2020 refresh, CMS will publicly display six new measures on the Nursing Home Compare website. SNF performance data for these measures below will be included for the first time in your preview reports.
- Changes in Skin Integrity Post-Acute Care: Pressure Ulcer/Injury,
- Drug Regimen Review Conducted with Follow-Up for Identified Issues - PAC SNF QRP,
- Application of IRF Functional Outcome Measure: Change in Self-Care,
- Application of IRF Functional Outcome Measure: Change in Mobility,
- Application of IRF Functional Outcome Measure: Discharge Self-Care Score, and
- Application of IRF Functional Outcome Measure: Discharge Mobility Score
The following existing measures will continue to be reported as part of the October 2020 refresh:
- Application of Percent of Residents Experiencing One or More Falls with Major Injury (Long Stay),
- Application of Percent of Long-Term Care Hospital (LTCH) Patients With an Admission and Discharge Functional Assessment and a Care Plan That Addresses Function,
- Medicare Spending Per Beneficiary - PAC SNF QRP,
- Discharge to Community - PAC SNF QRP, and
- Potentially Preventable 30-Day Post-Discharge Readmission Measure - SNF QRP
CMS is implementing the annual refresh of the SNF QRP claims-based measures during the October 2020 refresh of NH Compare. The annual refresh will include updates to the Medicare Spending per Beneficiary (MSPB), Discharge to Community (DTC) measure, and the Potentially Preventable Readmissions (PPR) measure.
CARES Act Funding Infection Control Training Program Updates:
Several weeks ago, the US Department of Health & Human Services (HHS) announced plans to direct an additional five billion dollars of CARES Act funds to build skills and enhance responses to COVID-19 in nursing facilities. These funds will be available to Medicare Certified nursing facilities and state veteran's homes that participate in a Nursing Home COVID-19 Training program developed in conjunction with the Centers for Medicare & Medicaid Services (CMS) and the Centers for Disease Control & Prevention (CDC) and implemented through the Quality Improvement Organizations (QIO).
When announced, the QIOs shared the CMS/CDC Nursing Home COVID-19 Training Series was the designated training program for providers to attend. Last evening, the Superior Health Quality Alliance, Michigan's QIO, shared with the association, the current series is NOT the required training and the CARES Act funds will be tied to e-learning modules not yet released. This training program is expected to be released in September or October of this year. We will share additional information and registration materials as soon as they are available.
Update on Business Interest Deduction Rule & Feedback Needed:
Before passage of the Tax Cuts and Jobs Act (TCJA) in 2017, skilled nursing facilities (SNFs) and assisted living facilities (AL) could deduct all their interest expenses when calculating federal taxable income. The interest deduction is important for SNFs/AL because the businesses involve significant real estate needs that are very capital-intensive. Large capital investments require financing, which thus generates significant interest expense.
The TCJA limited the interest deduction for all but certain types of businesses, including so-called "real property trades or businesses." AHCA/NCAL asked the IRS for clarity on whether businesses that own the real estate associated with SNFs/AL can continue to deduct all their interest. A proposed rule issued by the IRS in December 2018 would have prohibited such businesses from doing so if, as is common throughout the industry, they lease the real estate to a related party.
On July 28, 2020, the IRS issued a 575-page final rule expressly acknowledging AHCA/NCALs comments and recognizing those portions of the TCJA's legislative history emphasized, which support the conclusion that operation of property housing the elderly should qualify as "real property trades or businesses." Therefore, in conjunction with issuing the final rule, the IRS solicited comments on a newly created safe harbor whereby SNFs/ALs can qualify as "real property trades or businesses" if they satisfy a fact-specific test focusing on average period of resident use. The proposed safe harbor requires an average resident stay of 90 days or more (all residents included).
AHCA/NCAL needs to hear from members if this safe harbor works for their businesses. The IRS has asked for comments from the sector and AHCA/NCAL would like to ensure that as many SNFs and ALs as possible can deduct their interest expense.
We are asking members to determine whether your organization satisfies the proposed safe harbor and, if not, what modifications may be necessary before the safe harbor is finalized by the IRS. Specifically see pages 8-10 of the summary to determine if the formula identified to meet the 90-day average would work for your company.
As you review whether the formula works for your organizations, please also consider that electing to be treated as a "real property trade or business" can affect what depreciation* system you may use. Please consult with your accounting department before making such an election.
*IRS's FAQs on this topic state as follows:
Q7. Are there any consequences I should be aware of in making an election to be an excepted trade or business?
A7. Yes. If you make an election to be an excepted real property trade or business, the following assets that you hold in the electing real property trade or business must be depreciated using the alternative depreciation system (ADS), and are not eligible for a bonus depreciation deduction under section 168(k):
1. Nonresidential real property;
2. Residential rental property; and
3. Qualified improvement property.
Suggestions for how, if at all, the safe harbor should be amended can be directed to Mike Bassett at email@example.com no later than Friday, September 4, 2020.
CMS States New RAI Manual On Hold
The Centers for Medicare & Medicaid Services (CMS) announced it will not release an updated version of the MDS 3.0 RAI Manual as originally announced this Spring.
CMS officials confirmed the delay in the manual's release yesterday August 6, 2020 during the Skilled Nursing Facilities/Long-Term Care Open Door Forum. A CMS officer noted the agency will be sharing with state agencies there will not be a release of the RAI manual, and they should continue to use the 2019 version during survey activities.
For questions or concerns please contact Cathy Sunlin at CathySunlin@HCAM.org.
Aug. 7, 2020