State Nursing Home Quality Improvement Programs: Site Visit and Synthesis Report. 5.4 Funding Sources Used for Identified Quality Improvement Programs


In general, in the states that we studied we found that federal survey funds had not been used for technical assistance programs but had been used for other types of quality improvement activities. As discussed in Chapter 3, only two of the technical assistance programs in our study--the programs in Washington and Maine--receive any federal funding. The funding sources and amounts for each of our study state's technical assistance, best practice, training, and facility recognition programs are discussed below.

  • Florida: Florida's technical assistance program is funded by state general revenue funds. The total cost of the program is about $1.65 million--this includes $1,395,911 for the quality monitors and $261,000 for other expenses. The legislation authorizing the quality monitor program also increased licensing fees for facilities (from $35 to $50 per bed), and this increase covered part of the costs of the TA program.22 Costs for other Florida quality improvement programs that were funded under Senate Bill 1202 (2001) are as follows: nursing home risk management and quality assurance program: $2.1 million in FY 2001-02 and $1.54 million in FY 2002-03. (This includes costs of about $450,000 for data system development) and staff costs; Nursing Home Care Alzheimer's training: $10.5 million in FY 2001-02 and $6.8 million in FY 2002-03; surveyor training: $66,000 (in both FY 2001-02 and FY 2002-03). The risk management program is paid for entirely by state funds, but federal funds cover more than 50 percent of the funding for the state's Alzheimer's Training Program, under which dementia-specific training is provided to staff who care for residents with Alzheimer's Disease.23

  • Iowa: Iowa's public reporting, joint training, and provider recognition programs receive a 75 percent federal matching payments under Social Security Act 1903(a)(2)(A). The costs for the state's programs are as follows:
    • The Nursing Home Report card costs about $105,000 per year, including costs related to programming, web maintenance, electronic licensing fees, and scheduling software.
    • The Joint Surveyor/Provider Training sessions costs approximately $50,000 per year.
    • The Governor's Award program costs $5,000 per year, Deficiency-Free Certificates, $500 per year, and the Survey Questionnaire costs about $50,000 per year.
    • Costs for Iowa's Best Practices program (the state's Quality-Based Inspections program) are estimated at $15,000 per year. This program remains small, focusing only on facilities that do not participate in Medicare or Medicaid because of the inability to obtain a waiver of the federal survey frequency requirement (i.e., surveys are to occur on average every 12 months, and no later than 15 months).

  • Maryland: The $400,000 annual cost of the state's technical assistance program is funded entirely by state general funds. The state's Department of Health and Mental Hygiene has also established a health care quality account funded by civil money penalties paid by nursing homes. Expenditure of the funds can be made for any purpose that will directly improve quality of care in nursing facilities. In Summer 2002, there was $230,000 in the state account and $1,300,000 in the federal account. The state's other quality improvement programs have no impact on the state survey agency's budget, according to the state survey agency's director.

  • Maine: The cost of this program is less than $100,000 and covers the salary for a single technical assistance staff member and administrative support. These costs are part of the Licensing and Certification budget, which receive a 75 percent federal match under Social Security Act 1903(a)(2)(A). The state's best practices program has received about $5,000 in funding from state CMP fines.

  • Missouri: The major source of funding for Missouri's technical assistance program is the state's nursing facility quality improvement fund.24 Nursing homes are taxed based on the number of residents in the facility and a portion of the tax is required to be spent on quality improvement programs. Additional funds for the technical assistance program come from annual nursing facility licensing fees and state CMP fines. It seems unlikely that this state would have funded any technical assistance efforts if not for two requirements: (a) the state is mandated to have a quality improvement program, and (b) the funding cannot revert to the general fund if not spent on quality improvement. For the 2001-2002 fiscal year, the University of Missouri received a $625,947 grant for its technical assistance program. This was less than the $743,424 for 2000-2001, but an increase over the $492,258 received in 1998-1999.

  • Texas: The technical assistance and other quality improvement programs enacted as part of the Long-Term Care Facility Improvement Act of 2001 (State Senate Bill 1839) are financed by a combination of state and federal funds, and a facility licensing fee. According to the state's fiscal analysis, the cost of the new initiatives implemented as a result of this legislation is estimated at $1.3 million in FY 2002 and approximately $1.1 million thereafter.25 This includes the costs associated with the state's best practice and training programs, which are part of the state's Quality Monitoring program. The $330,000 one-time cost associated with implementing the quality assurance early warning system was eligible for a 75 percent federal match, under Section 1903(a)(3)(C).

  • Washington: The state receives a 75 percent federal match for its technical assistance program because this program is operated as part of its "medical and utilization or quality review" as provided in section 1903(a)(3)(C)(i). Annual costs for the program are about $2.8 million.26

  1. According to analysis by the State Senate, licensure fees were expected to cover $783,000 of the costs of the quality monitoring program for FY 2001-02 and $721,000 for FY 2002-2003.

  2. Source: Senate Staff Analysis and Economic Impact Statement,

  3. Licensing fees or bed taxes can only lead to quality improvement to the extent that the nursing facility payment rate is sufficient to meet basic nursing facility needs. A potential concern is that these fees or taxes may not be used to improve quality but instead are used to shift costs from states to the Federal Government.

  4. Source: Texas Legislature On-Line web site, ( B&BILLSUFFIX=01839&VERSION=1&TYPE=F).

  5. This includes the costs for the 75 percent of time that QAN nurses dedicate to QAN activities (The remaining 25 percent of their time is allocated to the survey.)

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