Performance Audit
of

Pennsylvania's
Medical Assistance Long-Term Care As Provided
In Nursing Facilities

September 30, 1997

 

Executive Summary


The following executive summary presents the audit's objectives and conclusions, as well as a brief synopsis of our results. Additional detail about our methodologies, conclusions, and recommendations can be found in the body of the report.

Chapter I - Licensing and Inspections

Objectives: We elected to determine whether the Department of Health is adequately ensuring that the providers meet all of the licensing requirements, and that all providers offering services are appropriately licensed. Additionally, our objectives included determining whether the Department of Health conducts the necessary inspections before issuing a license and whether the inspections ensure the providers are complying with the appropriate laws, regulations, and rules.

Conclusions Summary
We determined that procedures had been implemented and adequately ensured that the 25 nursing facilities we toured were appropriately licensed and inspected prior to receiving their license. In addition, we found that procedures ensured that the providers we sampled complied with appropriate regulations.

During the planning of our audit we became aware that certain stakeholders of the Long-Term Care Program were concerned that the Department of Health focused equal attention on all nursing facilities. They suggested that the Department of Health's effectiveness could be improved by concentrating efforts on poorer performing facilities, and relaxing the requirements for inspections of facilities with consistent records of compliance. However, we concluded that the Department of Health is already ensuring its effectiveness by spending additional time at poorer performing facilities. Additionally, we found that many factors prevent the likelihood that nursing facilities will maintain consistent records of compliance.

Although Section 804(d) of the Health Care Facilities Act of 1979 requires the Department of Health to provide annual reports on its effectiveness to the General Assembly, the only available report was the Report of the Quality Assurance Program, which was prepared in January 1997 for the 1995-96 fiscal year. The report provided very limited information about the Department of Health and did not include statistics about the performance of the department.

We recommend that the General Assembly require the Department of Health to consistently provide the information required by Section 804(d) of the Health Care Facilities Act of 1979. In addition, it should consider requesting additional information about the Department of Health's performance to assist its decision-making processes.

Chapter II - Complaints and Investigations

Objectives: Our objectives included determining whether the Department of Health's process of receiving complaints is adequate, and whether the Department of Health reviews all complaints alleging violations of laws, regulations, or rules in a timely manner.

Conclusions Summary
We determined that the Department of Health has implemented a system to record and receive the complaints filed on behalf of nursing home residents. Nevertheless, we discovered that at least three of the Department of Health's eight field offices had no written procedures to address complaints of a life-threatening nature which require immediate attention. In addition, the Department of Health has only established a system to record and receive complaints during normal business hours.

We recommend that the Department of Health (1) ensure that all eight field offices have written procedures to address complaints which require immediate attention and (2) establish a system to record and receive complaints after normal business hours.

Our review of 52 complaints filed at one of the Department of Health's eight field offices disclosed that 36 complaints (69 percent) were investigated late according to the Department of Health's own timetables. In addition, five of the other seven field offices acknowledged that they were unable to follow up complaints on a timely basis.

The inability of the Department of Health to resolve complaints in a timely manner affected the quality of care and services provided to nursing home residents in Pennsylvania. For example, the Department of Health investigated an allegation about a resident suffering from dehydration 13 working days late and 10 days after the resident had died.

The personnel we interviewed maintained that they had insufficient staff to follow up on complaints, in addition to completing inspections and surveys. Therefore, they had assigned a greater priority to their completion of the increasing number of inspections and surveys resulting from the growing number of nursing facilities in Pennsylvania.

We recommend that the Department of Health investigate complaints in a timely manner consistent with the priority code assigned. Additionally, the Department of Health should take immediate action to utilize its tracking system to determine if staffing is adequate to investigate all complaints promptly.

Our testing of 25 nursing facilities disclosed that those facilities used the Nurse Aide Registry to verify the qualifications of individuals seeking employment as nurse aides, and no barred nurse aides were employed at those facilities during the three calendar years ended December 31, 1996.

However, our examination of hiring policies and procedures disclosed that nursing homes had no procedures to detect barred nurse aides applying for other positions involving contact with residents. In addition, information from other states about nurse aides barred from employment has not been incorporated into the Commonwealth's registry.

Therefore, the Department of Health should require nursing facilities to use the Nurse Aide Registry to investigate the backgrounds of individuals applying for positions requiring direct or indirect contact with the residents of their facility. In addition, the Department of Health should incorporate barred nurse aide information from other states into its Nurse Aide Registry.

Chapter III - Violations

Objectives: We elected to determine whether the Department of Health is imposing sanctions if providers are found not to be in compliance with the appropriate laws, regulations, and rules, and to determine whether the Department of Health is consistently imposing sanctions for providers who are not in compliance.

Conclusions Summary
The Department of Health is imposing sanctions on providers who are not in compliance with appropriate laws and regulations. However, the number of those sanctions has consistently decreased during the three years ended December 31, 1996, while the number of nursing facilities has steadily increased.

To ensure that nursing facilities continually provide quality care to their residents, the Department of Health should analyze its system of imposing sanctions to determine the reasons for the reduction in the number of sanctions imposed.

The Department of Health considers the circumstances encompassing each facility's deficiencies in making its determinations to impose sanctions. Checklists and narratives prepared by the survey teams itemize any applicable factors to be used in determining the sanctions to be imposed. However, because the agency's decision-making process has not been documented, we were unable to complete our objective and conclude whether the Department of Health consistently imposes sanctions for providers who are not in compliance with laws and regulations.
Sanctions were amended after they had been imposed on nursing facilities without the approval of those individuals who initially authorized them. We also determined that sanction amendments were completed before appeals were filed by the nursing facilities to the Health Policy Board. Representatives of the Department of Health and the Health Policy Board confirmed that policies and procedures had not been established to amend sanction orders.

To ensure compliance with the Health Care Facilities Act, and provide for appropriate and authorized amendments to sanctions imposed on nursing facilities, the Department of Health should establish and adhere to policies and procedures for the amendment of sanctions.

Chapter IV - Reimbursement System

Objectives: Our objectives included determining whether the Department of Public Welfare ensured services billed by long-term care facilities for Medical Assistance residents were actually provided. In addition, we elected to determine if the reimbursement rate was accurately calculated and used in determining the payment for the long-term care facilities in our sample.

Conclusions Summary
Our testing and inquiries revealed that the case-mix system calculates applicable reimbursement rate information accurately, and applies the correct parameters for peer group and individual long-term care facility rate calculations.

In addition, we noted no exceptions between the rates calculated by the case-mix system and the rates used in the Medical Assistance Management Information System used to disburse payments.

We verified the calculations, rates, and dates of service for 10 invoices at each of the 25 nursing facilities we visited. The results of our testing provided reasonable assurance that the long-term care facilities provided the services that were billed.
We identified errors in the picture date data submitted by nursing facilities to the Department of Public Welfare for the calculations of reimbursement rates. These errors could have been corrected prior to the reimbursement rate calculations if additional edit checks and controls had been implemented in the Nursing Home Information System. We recommend that the Department of Public Welfare implement safeguards to detect and prevent input errors.

In addition, we reviewed the responsibilities of the Utilization Management Review teams and determined that they have chosen to prevent future errors from occurring through education, rather than functioning in a capacity to make adjustments to previous payments to nursing facilities. However, the Utilization Management Review team is the only mechanism in place to assure that appropriate payments are made.

Consequently, we recommend that the Department of Public Welfare determine the impact of errors in picture date data transmitted for the calculation of reimbursement rates and adjust the facility's reimbursement amounts.

Our testing revealed that nursing facilities are able to receive payments for residents who have died. Although the Department of Public Welfare verifies a resident's eligibility by checking the Client Information System updated by county assistance offices before processing payments, this system does not always contain the current status of a resident because the system relies on information provided by nursing facilities.

Therefore, in order to recover payments for services claimed for deceased residents, the Department of Public Welfare should establish a routine procedure to match the active records in the Client Information System with the death records filed with the Department of Health.

Our review of the Resource Utilization Groups III index scores showed that the number of Medical Assistance and non-Medical Assistance residents who have received lower levels of care has decreased 18 percent and 22 percent, respectively, from February 1994 to February 1997.

We recommend that the Department of Public Welfare monitor the shifts to the categories of higher scores to determine if the case-mix system is providing the necessary incentive to long-term care facilities to admit Medical Assistance recipients that need higher levels of care.

Although representatives of the nursing facilities favored the present case-mix system to the previous reimbursement system because it more accurately matched cost reimbursement with levels of care, our inquiries revealed that residents suffering from Alzheimer's disease may be improperly classified. The cost of additional non-medical personnel who function as chaperones for the affected residents was not considered in the low index score applied by the Resource Utilization Groups III system.

We recommend the Department of Public Welfare monitor the level of care to Alzheimer's residents, and consider revising the index scores for residents with this infirmity.

Chapter V - Case Management Practices and Quality of Care

Objectives: We elected to determine whether the Departments of Health and Public Welfare are ensuring assessments are conducted and care plans are developed to ensure each resident receives appropriate services. In addition, we attempted to evaluate the quality of care being provided to Pennsylvania nursing home residents.

Conclusions Summary
We determined that the Departments of Health and Public Welfare review resident assessments and care plans as part of their routine inspection processes. Problems identified during these inspections are documented and remedied in plans of correction and corrective action plans prepared by the nursing facilities.

The results of our testing at the nursing facilities we visited confirmed that care plans were developed in accordance with the assessments conducted, and the plans of correction resulting from agency surveys were implemented.

Although inspection reports resulting from Department of Health surveys are public information and provide Pennsylvania residents with the most current information about the quality of care at each facility, those reports are not presently useful for the selection of a nursing facility. In addition to being difficult to read, the reports do not include the total number of deficiencies at each facility, comparative information from other surveys or other facilities, or an explanation of the seriousness of the facility's instances of noncompliance.

Therefore, we recommend that the Governor designate a council, agency, or board to provide Pennsylvania residents with the additional information necessary for them to make decisions regarding the placement of their family members and friends in nursing facilities.

Chapter VI - Medical Assistance Approval Process

Objectives: Our objective was to determine whether there are delays in the Medical Assistance approval process and, if they exist, whether they can be prevented.

Conclusions Summary
Survey results revealed that less than 75 percent of Medical Assistance approvals are received within 90 days of the date of application. Although the most prevalent reason cited for delays established that families and responsible parties fail to provide necessary documentation to county assistance offices, the second and third most frequently cited reasons included county assistance office staffing problems and processing procedures.

However, we determined that the Department of Public Welfare has already taken appropriate steps to facilitate the timeliness of the Medical Assistance approval process. Those steps included the identification of county assistance offices with problems, the implementation of a corrective action plan for those offices, and streamlining the Medical Assistance application to ask the "right" questions.

We recommend that after the Department of Public Welfare has completed its training program and introduced the revised Medical Assistance application, it should poll the participants to monitor the timeliness of the approval process.

 

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