CMS Program Memorandum
DEPARTMENT OF HEALTH & HUMAN SERVICES
Centers for Medicare & Medicaid Services
7500 Security Boulevard, Mail Stop S2-26-12
Baltimore, Maryland 21244-1850
DATE: December 12, 2002
FROM: Director, Survey and Certification Group
SUBJECT: Information Exchange by Surveyors During the Nursing Home Survey Process
TO: Associate Regional Administrators, DMSO, State Survey Agency Directors
The purpose of this policy letter is to reiterate the role and function of surveyors during the survey process on the issue of consultation, technical assistance, and sharing best practice information.
In accordance with State Operations Manual (SOM), Section 9, Appendix P, page 77, Information Transfer, "the State should provide information to the facility about care and regulatory topics that would be useful to the facility for understanding and applying best practices in the care and treatment of the long term care residents. This information exchange is not a consultation with the facility, but is a means of disseminating information that may be of assistance to the facility in meeting long term care requirements." The intent is to allow surveyors to provide reference information regarding best practices to assist facilities in developing additional sources and networking tools for program enhancement. State Health Facility Surveyors, however, should not act as consultants to nursing homes.
The nursing home is responsible for correcting its deficiencies. State Operations Manual, §2727, provides direction regarding Limitations on Technical Assistance Afforded by Surveyors. It is not the surveyors responsible to delve into the facility's policies and procedures to determine the root cause of the deficiency or to sift through various alternatives to suggest an acceptable remedy. When the State Agency conducts a revisit, it is to confirm that the facility is in compliance with the cited deficiencies, not whether it implemented the suggested best practices, and has the ability to remain in compliance.
Effective Date: N/A
Training: The information contained in this announcement should be shared with all survey and certification staff, their managers and the state/RO training coordinator.
Steven A. Pelovitz
Survey and Certification Regulations: Staffing and Training Expenditures (432.50)
Subpart C--Staffing and Training Expenditures1
§ 432.45 Applicability of provisions in subpart.
The rates of FFP specified in this subpart C do not apply to State personnel who conduct survey activities and certify facilities for participation in Medicaid, as provided for under section 1902(a)(33)(B) of the Act.
[50 FR 46663, Nov. 12, 1985; 50 FR 49389, Dec. 2, 1985]
§ 432.50 FFP: Staffing and training costs.
(a) Availability of FFP. FFP is available in expenditures for salary or other compensation, fringe benefits, travel, per diem, and training, at rates determined on the basis of the individual's position, as specified in paragraph (b) of this section.
(b) Rates of FFP. (1) For skilled professional medical personnel and directly supporting staff of the Medicaid agency or of other public agencies (as defined in § 432.2), the rate is 75 percent.
(2) For personnel engaged directly in the operation of mechanized claims processing and information retrieval systems, the rate is 75 percent.
(3) For personnel engaged in the design, development, or installation of mechanized claims processing and information retrieval systems, the rate is 50 percent for training and 90 percent for all other costs specified in paragraph(a) of this section.
(5) For personnel administering family planning services and supplies, the rate is 90 percent.
(6) For all other staff of the Medicaid agency or other public agencies providing services to the Medicaid agency, and for training and other expenses of volunteers, the rate is 50 percent.
(c) Application of rates. (1) FFP is prorated for staff time that is split among functions reimbursed at different rates.
(2) Rates of FFP in excess of 50 percent apply only to those portions of the individual's working time that are spent carrying out duties in the specified areas for which the higher rate is authorized.
(3) The allocation of personnel and staff costs must be based on either the actual percentages of time spent carrying out duties in the specified areas, or another methodology approved by HCFA.
(d) Other limitations for FFP rate for skilled professional medical personnel and directly supporting staff--(1) Medicaid agency personnel and staff. The rate of 75 percent FFP is available for skilled professional medical personnel and directly supporting staff of the Medicaid agency if the following criteria, as applicable, are met:
(i) The expenditures are for activities that are directly related to the administration of the Medicaid program, and as such do not include expenditures for medical assistance;
(ii) The skilled professional medical personnel have professional education and training in the field of medical care or appropriate medical practice. ''Professional education and training'' means the completion of a 2-year or longer program leading to an academic degree or certificate in a medically related profession. This is demonstrated by possession of a medical license, certificate, or other document issued by a recognized National or State medical licensure or certifying organization or a degree in a medical field issued by a college or university certified by a professional medical organization. Experience in the administration, direction, or implementation of the Medicaid program is not considered the equivalent of professional training in a field of medical care.
(iii) The skilled professional medical personnel are in positions that have duties and responsibilities that require those professional medical knowledge and skills.
(iv) A State-documented employer-employee relationship exists between the Medicaid agency and the skilled professional medical personnel and directly supporting staff; and
(v) The directly supporting staff are secretarial, stenographic, and copying personnel and file and records clerks who provide clerical services that are directly necessary for the completion of the professional medical responsibilities and functions of the skilled professional medical staff. The skilled professional medical staff must directly supervise the supporting staff and the performance of the supporting staff's work.
(2) Staff of other public agencies. The rate of 75 percent FFP is available for staff of other public agencies if the requirements specified in paragraph (d)(1) of this section are met and the public agency has a written agreement with the Medicaid agency to verify that these requirements are met.
(e) Limitations on FFP rates for staff in mechanized claims processing and information retrieval systems. The special matching rates for persons working on mechanized claims processing and information retrieval systems (paragraphs (b)(2) and (3) of this section) are applicable only if the design, development and installation, or the operation, have been approved by the Administrator in accordance with part 433, subchapter C, of this chapter.
[43 FR 45199, Sept. 29, 1978, as amended at 46 FR 48566, Oct. 1, 1981; 50 FR 46663, Nov. 12, 1985]
§ 432.55 Reporting training and administrative costs.
(a) Scope. This section identifies activities and costs to be reported as training or administrative costs on quarterly estimate and expenditure reports to HCFA.
(b) Activities and costs to be reported on training expenditures. (1) For fulltime training (with no assigned agency duties): Salaries, fringe benefits, dependency allowances, travel, tuition, books, and educational supplies.
(2) For part-time training: Travel, per diem, tuition, books and educational supplies.
(3) For State and local Medicaid agency staff development personnel (including supporting staff) assigned fulltime training functions: Salaries, fringe benefits, travel, and per diem. Costs for staff spending less than full time on training for the Medicaid program must be allocated between training and administration in accordance with § 433.34 of this subchapter.
(4) For experts engaged to develop or conduct special programs: Salary, fringe benefits, travel, and per diem.
(5) For agency training activities directly related to the program: Use of space, postage, teaching supplies, and purchase or development of teaching materials and equipment, for example, books and audiovisual aids.
(6) For field instruction in Medicaid: Instructors' salaries and fringe benefits, rental of space, travel, clerical assistance, teaching materials and equipment such as books and audiovisual aids.
(c) Activities and costs not to be reported as training expenditures. The following activities are to be reported as administrative costs:
(1) Salaries of supervisors (day-to-day supervision of staff is not a training activity); and
(2) Cost of employing students on a temporary basis, for instance, during summer vacation.
[43 FR 45199, Sept. 29, 1978, as amended at 44 FR 17935, Mar. 23, 1979]
CMS Program Memorandum
DEPARTMENT OF HEALTH & HUMAN SERVICES
Centers for Medicare & Medicaid Services
7500 Security Boulevard
Baltimore, MD 21244-1850
DATE: August 8, 2002
FROM: Director, Survey and Certification Group, Center for Medicaid and State Operations
SUBJECT: Use of Civil Money Penalty (CMP) Funds by States
TO: Associate Regional Administrator, Divisions of Medicaid & State Operations, Regions I - X, State Survey Agency Directors
The purpose of this memorandum is to provide information regarding how states may use CMP funds collected from nursing homes that have been out of compliance with Federal requirements. It has come to our attention that guidance is needed to ensure that states use CMP funds in accordance with the law and in a consistent manner, while maintaining some flexibility in the use of those funds.
Background -- States collect CMP funds from Medicaid nursing facilities and from the Medicaid part of dually-participating skilled nursing facilities (SNFs) that have failed to maintain compliance with Federal conditions of participation. These CMP funds are state, not Federal funds. CMP funds collected from Medicare-participating SNFs and the Medicare part of dually-participating SNFs are Federal funds and are returned to the Medicare Trust Fund.
Section 1919(h)(2)(A)(ii) of the Social Security Act (the Act) provides that CMP funds collected by a state as a result of certain actions by nursing facilities or individuals must be applied to the protection of the health or property of residents of nursing facilities that the state or the Secretary finds deficient. These actions include CMPs assessed against:
- A nursing facility that is not in compliance with Federal requirements in sections 1919(b), (c), (d) of the Act;
- An individual who willfully and knowingly certifies a material and false statement in a resident assessment (section 1919(b)(3)(B)(ii)(I) of the Act);
- An individual who willfully and knowingly causes another individual to certify a material and false statement in a resident assessment (section 1919(b)(3)(B)(ii)(II) of the Act); and
- An individual who notifies ( or causes to be notified) a nursing facility of the time or date on which a standard survey is scheduled to be conducted (section 1919(g)(2)(A)(i) of the Act).
The Act cites three examples of uses for CMPs:
- Payment for the costs of relocation of residents to other facilities;
- Maintenance of operation of a facility pending correction of deficiencies or closure; and
- Reimbursement of residents for personal funds lost.
The regulations, at 42 CFR 488.442(g), contain similar language, with some very minor wording changes that make it clear that the costs of relocation of residents to other facilities are for state costs. The regulations also indicate that the personal funds lost at a facility are the result of actions by the facility or by individuals used by the facility to provide services to residents. Section 7534B of the State Operations Manual (SOM) contains similar language, but specifies that the funds must be used to protect the health or property of residents of deficient facilities.
In the preamble to the final enforcement regulations published on November 10, 1994, we indicated that the law suggests that CMP revenues be applied to administrative expenses rather than direct care costs, although it is clear that states have broad latitude to determine which of these types of expenses best meet the needs of their residents (page 56210 of the Federal Register, Volume 59, No. 217). Further, the preamble is very clear that the Act permits each state to implement its own procedures with respect to the use of CMPs. Our previous direction to CMS regional offices has been that the specified uses of CMP funds in the Act and section 488.442(g) are not exhaustive, that states need flexibility in determining the appropriate use of funds, and that regional offices have some oversight responsibility. Beyond this, we have not provided general guidance to all states and regional offices on what is considered appropriate use of these funds within the scope of the law and regulations. Due to the lack of guidance, a number of states have been reluctant to use a majority of the money. As a result, some states have a significant amount of money on deposit and this amount is continuously growing.
Flexibility in Use of CMP Funds -- While the Act provides states with much flexibility to be creative in the use of CMP funds, this flexibility is limited by the requirement that CMP funds are to be focused on facilities that have been found to be deficient. However, the law does not specify when a facility must have been determined to be deficient to qualify for benefits under a state project funded by CMPs. Most nursing facilities have had one or more deficiencies either recently or in the past. Rather than setting forth rigid criteria on when it is that a facility must have been deficient to be an eligible target for the application of CMP revenues, we believe that the best course is to offer states maximum flexibility to make this determination. Apart from this, we believe that projects funded by CMP collections should be limited to funding on hand and should be relatively short-term projects.
Each state is responsible for ensuring that CMP funds are applied in accordance with the law. Regional oversight should be general in nature, responding to questions from states or commenting on the occasional project proposal submitted for regional office input, but there is no requirement that a regional office review and approve each state project before it is implemented.
Appropriate CMP Fund Use --As we stated in the preamble to the 1994 final enforcement regulations, CMP revenues should be spent on administrative expenses, rather than direct care costs, as applied to deficient facilities. If the purpose of the state project is related to deficient practice, the CMP funds could be used to prevent continued noncompliance by nursing facilities through educational or other means. For example, to address particular areas of noncompliance, a state could develop videos, pamphlets, or other publications providing best practices, with these educational materials being distributed to all deficient nursing facilities. Other uses could include, for example, the development of public service announcements on issues directly related to the identified deficient area, and employment of consultants to provide expert training to deficient facilities. North Carolina and other states have issued grants to several nursing facilities to fund Eden Alternative Projects, which provide training and other services necessary to support the use of animals in nursing facilities for therapeutic purposes. Because CMP funds collected by a state are state funds, the state may use the money for any project that directly benefits facility residents, in accordance with section 1919(h)(2)(A)(ii) of the Act, including funding an increase in ombudsman services.
Inappropriate CMP Fund Use -- We believe that it is not appropriate for states to use CMP funds for a loan to a deficient facility that is having financial difficulty meeting payroll or paying vendors. As pointed out in the preamble, if the CMP is used by the facility to correct the noncompliance that led to its imposition, it is, in effect, not a remedy.
If you believe that a state is not spending collected CMPs in accordance with the law or regulations, or not at all, you should refer this matter to your regional office account representative so that he or she may discuss this matter with the state.
Effective Date: This guidance is effective on the date of issuance.
Training: This policy should be shared with all survey and certification staff, surveyors, their managers and the state/regional training coordinator.
Steven A. Pelovitz
- Excerpt from 42 CFR Ch. IV (10-1-99 Edition), pages 63-64.