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Transcript for audio podcast: California's Licensing Surveys of Nursing Homes Could Not Ensure the Quality of Care for Beneficiaries

From the Office of Inspector General of Department of Health and Human Services

[Marc DeGuzman] This is Marc DeGuzman in San Diego, speaking with Reid Sund, an auditor from the San Diego field office. Let's talk about your audit of California nursing homes and quality-of-care risks to Medicare and Medicaid beneficiaries during 2010 and 2011. OIG found that nursing homes may not have provided adequate protection to beneficiaries. Can you tell us more about the audit?

[Reid Sund] Thanks, Marc. Our audit looked at how the Centers for Medicare and Medicaid Services, known as CMS, relied on California's nursing home licensing surveys. CMS contracts with State agencies to oversee nursing homes. In California, CMS contracts with the Department of Public Health. Nursing homes that participate in the Medicare and Medicaid program must be licensed under State law. CMS relies on the State licensure process as one way to ensure quality of care in nursing homes. The licensing surveys should ensure that nursing homes comply with State requirements.

[Marc DeGuzman] What are some of the things that the audit focused on?

[Reid Sund] Well for this review, we looked at employee qualifications, like whether employees were licensed and had required health exams. Employee health exams ensure that the employees working in the nursing homes do not have health conditions that could jeopardize the health of residents. We also looked at specific units inside nursing homes called "optional service units." These units provide more specialized services, such as physical therapy.

[Marc DeGuzman] Can you explain how you conducted this review?

[Reid Sund] Sure. We visited eight randomly selected nursing homes and spent about a week onsite at each one, interviewing staff and reviewing their records. In total, we reviewed 240 employee personnel files and other supporting documentation. We also visited the five Department of Public Health district offices that conducted the licensing surveys of the eight nursing homes. We interviewed their staff, and reviewed their records.

[Marc DeGuzman] What kind of issues did you find?

[Reid Sund] All 240 sampled employees were licensed or certified in accordance with State law. However, 59 of 240 employees were missing at least one required health examination, and 73 employees had health exams that were missing key components.

[Marc DeGuzman] Can you give us an example?

[Reid Sund] Sure. For example, one of the key components is a tuberculosis screening. For some employees, we did not see any documented evidence that they had the tuberculosis screening. The health exams, which included a tuberculosis screening, are a critical safeguard to make sure employees are healthy and won't pose a risk to residents.

[Marc DeGuzman] Did you identify any other issues?

[Reid Sund] Yes, we found that seven of the eight sampled nursing homes provided specialized services in optional service units. The problem is those nursing homes never got approval from the Department of Public Health to have optional service units.

[Marc DeGuzman] Why do nursing homes need approval for these units?

[Reid Sund] The units must be inspected, formally approved, and added to the nursing home's license. Because the optional service units weren't approved, we couldn't be sure that they met State requirements for protecting Medicare and Medicaid beneficiaries.

[Marc DeGuzman] What's contributing to these issues?

[Reid Sund] Although most of the nursing homes had policies that required health exams, they did not always follow those policies. And, some of the nursing homes had policies and procedures that did not fully address the health examination requirements. For a few nursing homes, we found that the State did not even conduct required licensing surveys for these specific requirements.

[Marc DeGuzman] What about the optional service units that provided specialized care?

[Reid Sund] We found that nursing homes didn't understand that they must get separate approval and licensing for optional service units. In fact, surveyors inspecting nursing homes were not required to confirm that a nursing home was even approved to offer specialized services.

[Marc DeGuzman] Well, it sounds like your audit identified some quality of care risks. What was CMS's response to the report?

[Reid Sund] It agreed with our recommendations. CMS does not have authority over State licensure requirements, employee screening or optional service approvals. However, CMS does plan to work with the California Department of Public Health to improve quality of care in nursing homes.

[Marc DeGuzman] Well thanks Reid, for sharing your experience on the review of California nursing homes.

[Reid Sund] You're welcome.


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