Performance audit, Department of Health Services, Office of Long Term Care : a report to the Arizona Legislature

              A REPORT
TO THE
ARIZONA LEGISLATURE
Debra K. Davenport
Auditor General
Department of
Health Services
Office of Long Term Care
Performance Audit Division
December • 2002
REPORT NO. 02 – 13
Performance Audit
The Auditor General is appointed by the Joint Legislative Audit Committee, a bipartisan committee composed of five
senators and five representatives. Her mission is to provide independent and impartial information and specific
recommendations to improve the operations of state and local government entities. To this end, she provides financial
audits and accounting services to the State and political subdivisions, investigates possible misuse of public monies, and
conducts performance audits of school districts, state agencies, and the programs they administer.
The Joint Legislative Audit Committee
Representative Roberta L. Voss, Chair Senator Ken Bennett, Vice Chair
Representative Robert Blendu Senator Herb Guenther
Representative Gabrielle Giffords Senator Dean Martin
Representative Barbara Leff Senator Peter Rios
Representative James Sedillo Senator Tom Smith
Representative James Weiers (ex-officio) Senator Randall Gnant (ex-officio)
Audit Staff
Shan Hays, Manager and Contact Person
Mark Haldane, Team leader Pam Eck
Anita Rifkin
Copies of the Auditor General’s reports are free.
You may request them by contacting us at:
Office of the Auditor General
2910 N. 44th Street, Suite 410 • Phoenix, AZ 85018 • (602) 553-0333
Additionally, many of our reports can be found in electronic format at:
www.auditorgen.state.az.us
2910 NORTH 44 th STREET • SUITE 410 • PHOENIX, ARIZONA 85018 • (602) 553 -0333 • FAX (602) 553 -0051
DEBRA K. DAVENPORT, CPA
AUDITOR GENERAL
STATE OF ARIZONA
OFFICE OF THE
AUDITOR GENERAL WILLIAM THOMSON
DEPUTY AUDITOR GENERAL
December 30, 2002
Members of the Arizona Legislature
The Honorable Jane Dee Hull, Governor
Ms. Catherine R. Eden, Ph.D., Director
Department of Health Services
Transmitted herewith is a report of the Auditor General, A Performance Audit of the
Department of Health Services, Division of Assurance and Licensure Services, Office of
Long Term Care. This audit, conducted pursuant to Laws 2001, Chapter 143, §1 was
carried out under the authority vested in the Auditor General by A.R.S. §41-1279.03 I
am also transmitting with this report a copy of the Report Highlights for this audit to
provide a quick summary for your convenience.
As outlined in its response, the Department agrees with all of the findings and
recommendations.
My staff and I will be pleased to discuss or clarify items in the report.
This report will be released to the public on December 31, 2002.
Sincerely,
Debbie Davenport
Auditor General
Enclosure
Services:
The Office of Long Term Care is one of five programs
under the Department of Health Services Assurance
and Licensure Services Division. The Office has the
following responsibilities:
1. Performing regular inspections of licensed nursing homes;
2. Investigating complaints;
3. Initiating enforcement actions against facilities with
deficiencies;
4. Assisting providers with understanding statutes, rules,
regulations, and policies;
5. Providing the public with information on facilities; and
6. Oversight of Medicare/Medicaid-certified facilities through
an agreement with the federal Centers for Medicare and
Medicaid Services (CMS).
Facilities and Equipment:
The Office leases space in two state-owned buildings at
1647 East Morton Street in Phoenix and 400 West
Congress Street in Tucson. Its equipment includes typical
office equipment such as furniture and computer
equipment. In addition, the Office uses a satellite dish
provided by CMS for mandated training broadcasts.
Mission:
The mission of the Office is to protect and promote the
health and safety of residents in nursing care institutions
and intermediate care facilities for the mentally retarded.
Department of Health Services—Division of Assurance
and Licensure Services
Office of Long Term Care
Office of the Auditor General
FACT SHEET
Program office funding sources:
$3,004,291 (fiscal year 2002)
Support Staff—7
(2 vacant)
Management/
Administration—9
(2 vacant)
Inspectors—36
(9 vacant)
Program office staffing:
52 appropriated FTE (fiscal year 2003)
$550,246
$1,968,130
$279,848
$199,672
$6,395
$0
$200,000
$400,000
$600,000
$800,000
$1,000,000
$1,200,000
$1,400,000
$1,600,000
$1,800,000
$2,000,000
General Fund 1 Federal
Other Intergovernmental Fines and Forfeits
Other
As of August 2002
State of Arizona
Goals:
The Office has established three goals separate from the Division’s goals:
1. Increase public information available to customers and stakeholders;
2. Improve timeliness of the inspecton and investigation process; and
3. Enhance the system of communicating internal changes and issues of concern to
staff.
In addition, according to division administrators, two of the Division’s eight goals are
particularly related to the Office’s mission. These goals are:
1. To perform inspections, complaint investigations, and license issuance within required
time frames; and
2. To improve consumers’ awareness of the Division as a source of information.
Adequacy of performance measures:
For the first goal, the Division has established three performance measures to assess
timeliness of inspections, complaint investigations, and license issuance. For example, it
has developed a measure for the percentage of complaint investigations alleging actual
harm that are not initiated within required deadlines and one for the overall percentage of
late complaint investigations. However, the Office should also consider measures that
would provide information on resources used, such as efficiency measures for the average
number of staff hours for inspections and investigations.
The Division has developed one measure for the second goal, number of visits to the
Division’s Web site. The Office should consider establishing additional input, output, quality,
and outcome measures to indicate how it intends to improve its public information function.
For example, it could develop quality measures to assess both the completeness of
information on its Web site, and consumer satisfaction with the information provided.
The Office of the Auditor General has conducted a performance audit of the
Department of Health Services, Division of Assurance and Licensure Services, Office
of Long Term Care (the Office) to determine how effectively it regulates nursing care
institutions. This audit, conducted pursuant to Laws 2001, Chapter 143, §1, was car-ried
out under the authority vested in the Auditor General by A.R.S. §41-1279.03.
The Office, which licenses and regulates 139 Arizona nursing homes, is mandated to
enforce nursing home quality-of-care regulations. Additionally, it certifies two tribal
facilities and monitors the Arizona Pioneers’ Home. Its responsibilities include con-ducting
annual state licensure and Medicare certification inspections, investigating
incidents reported by nursing homes and complaints received against nursing
homes, providing technical assistance and education to nursing home staff, and pro-viding
information about nursing homes to the public. The Office is responsible for
oversight of Medicare/Medicaid-certified facilities through an agreement with U.S.
Department of Health and Human Services, Centers for Medicare and Medicaid
Services (CMS). Additionally, the Office notifies homes of regulatory violations or defi-ciencies,
obtains their corrective action plans, and issues sanctions against them as
needed according to the scope and severity of their deficiencies.
Some investigation practices need improvement (see
pages 9 through 13)
The Office needs to improve some of its practices regarding staff-related abuse- and
neglect-related incidents reported by nursing homes and complaints reported by res-idents,
families, and others. Problems are generally reported to the Office in two
ways. First, the Office receives complaints from residents and their families, state
agencies, and others. It receives over 700 such complaints each year. Second, nurs-ing
homes submit reports of incidents that range from minor incidents such as prop-erty
loss to serious allegations of abuse.
Although the Office investigates all complaints and has recently eliminated its com-plaint
investigation backlog, it does not investigate all incidents involving staff-related
page i
Office of the Auditor General
SUMMARY
abuse or neglect reported by nursing homes. Federal regulations require that all such
incidents be investigated. Some of these reports involve issues as serious as those
alleged in complaints from residents and families. Auditors reviewed files for 30 of the
State’s 139 homes and found the Office investigated only 20 out of 108 self-reported
incidents of abuse and neglect at those 30 homes. At least 35 of the uninvestigated
incidents involved staff. Limited staffing may preclude on-site investigation of all such
incidents. However, in some cases the Office may be able to conduct investigations
through telephone interviews and examination of documents provided by the home,
including the home’s internal investigation of the incident.
In addition to not investigating self-reported incidents, the Office does not always
consistently apply complaint priorities. When the Office receives a complaint, it
assigns one of four priority levels for investigation based on the seriousness of the
allegation. For example, priority 1 complaints involve immediate and serious threats
to health and safety, and must be investigated within 2 days. Auditors found cases in
which complaints alleging actual harm or neglect, which the Office should have clas-sified
as priority 2 and investigated within 10 days, were misclassified as priority 3,
allowing 45 days to complete the investigation. This delayed those investigations for
up to 35 days, which could have compromised nursing home residents’ health and
safety. CMS reviews of the Office have noted similar misclassifications. To help make
consistent and appropriate priority assignments, the Office should develop detailed
guidelines specific to the long-term care program for assigning priorities.
The Office should provide more public information (see
pages 15 through 19)
The Office does not always provide the public with the information it needs to make
informed decisions about the quality of care that nursing homes provide. Some pub-lic
documents are misfiled in nonpublic files, which results in members of the public
receiving incomplete information. Further, some documents in the public files have
more material expunged than the law requires and are no longer meaningful. The
Office has proposed a change in statute that would reduce its redaction require-ments.
Additionally, although the Office assigns a quality-of-care rating to each
home, its explanation of what the rating means can be easily misunderstood.
However, the Office has proposed rules to establish a new quality rating system to
the Governor’s Regulatory Review Council. Finally, the Office’s limited staff resources
and an inadequate complaint-tracking system have affected its ability to provide
complete information over the telephone. Its new complaint-tracking system imple-mented
in October 2002 should help staff provide more information by telephone.
The Office has made substantial changes to its Web site and is participating in a
state-wide effort to improve information available for aging citizens. As it continues its
page ii
State of Arizona
improvements, it may wish to consider models offered by other state Web sites that
provide more comprehensive public information, such as comparisons between a
home’s performance and the state average. Further, some information is still not eas-ily
accessible through the Office’s Internet site. For example, most specific informa-tion
about homes is provided through a link to the CMS Web site, but state enforce-ment
and other information, including quality rating, requires looking in a different
place in the Office’s own site. The Office should continue to improve the information
it makes available and establish more user-friendly forms of access to this informa-tion.
The Office can use state sanctions more often (see
pages 21 through 23)
The Office should make more use of state sanctions when it finds that nursing homes
are deficient in meeting state standards. The Office has improved its inspection time-liness
in the last 2 years, and it uses acceptable standards for inspections and con-sistently
recommends sanctions to CMS when it finds violations of Medicare and
Medicaid standards. However, the Office makes very limited use of some state sanc-tions,
such as fines or license suspensions. Relying on federal penalties may reduce
the Office’s ability to ensure that facilities comply with standards because federal reg-ulators
do not always impose the recommended penalty. In 2001, CMS did not take
any action against at least 5 nursing homes after the Office recommended penalties
they believed should be implemented. In addition, the lengthy federal appeals
process can delay penalties. Currently, two Arizona cases have unresolved federal
appeals, and both are more than 2 years old. Some other states, such as
Washington and Florida, impose state penalties more often than Arizona because
they believe they can enforce these penalties more quickly than federal sanctions.
The Office should make more frequent use of state sanctions in addition to recom-mending
federal sanctions.
Other pertinent information (see pages 25 through 27)
Auditors gathered information about other states’ licensing standards for nursing
homes. Most states, including Arizona, supplement federal standards with some
standards of their own. These additional standards usually relate to staffing levels,
which several studies have linked to quality of care. Federal standards require nurs-ing
homes to provide “sufficient staff” for 24-hour service to residents and a regis-tered
nurse for 8 hours each day. A 2001 private research survey shows that 13
states have increased minimum staffing requirements over the federal standards and
page iii
Office of the Auditor General
33 states have minimum staffing requirements for nursing assistants and other
direct-care nursing staff. In Arizona, administrative rules require the presence of at
least one nurse to care for no more than 64 residents. Some states have gone fur-ther
than Arizona, instituting additional requirements. However, nursing shortages
and the financial condition of some nursing homes may make the imposition of high-er
staffing ratios impractical until those conditions change.
Besides adding more staffing requirements, some states have instituted more rigor-ous
complaint investigation time frames than required by the federal standards to
avoid delay in identifying serious problems. Arizona has not done so. However, the
State has instituted requirements on some other matters not required by the federal
standards, including fingerprinting checks for nursing home employees, and
employee testing for tuberculosis.
page iv
State of Arizona
pagev
Office of the Auditor General
TABLE OF CONTENTS
continued
1
9
9
11
13
15
15
15
17
19
21
21
22
23
25
a-i
Introduction & Background
Finding 1: Some investigation practices need improve-ment
Self-reported incidents not always investigated
Complaint prioritization inconsistent
Recommendations
Finding 2: The Office should provide more public infor -
mation
Information needed for decisions
Some information incomplete or unclear
The Office should continue improving telephone and Web site
information
Recommendations
Finding 3: The Office can use state sanctions more
often
The Office performs some inspection aspects well
The Office could make more use of state sanctions
Recommendation
Other Pertinent Information
Appendix
Agency Response
page vi
State of Arizona
TABLE OF CONTENTS
Tables:
1 The Office of Long Term Care
Statements of revenues, expenditures, and changes in fund balances
Years ended June 30, 2000, 2001, and 2002 (Unaudited)
2 Complaints received by priority
Year ended June 30, 2002
5
12
concluded
The Office of the Auditor General has conducted a performance audit of the
Department of Health Services, Division of Assurance and Licensure
Services, Office of Long Term Care (the Office) to determine how effectively
it regulates nursing care institutions. This audit, conducted pursuant to Laws
2001, Chapter 143, §1, was carried out under the authority vested in the
Auditor General by A.R.S. §41-1279.03.
The Office enforces quality-of-care regulations
The state and federal governments share responsibility for setting and enforcing
nursing homes’ quality care standards. All nursing homes operating in the State must
be licensed and meet state quality standards. In addition, nursing homes desiring to
participate in the Medicare and Medicaid health programs must be certified by the
U.S. Department of Health and Human Services, Centers for Medicare and Medicaid
Services (CMS). One hundred thirty-five of the State’s 139 licensed nursing homes
are certified to participate in Medicare and/or Medicaid. The Office serves as the pri-mary
agency for enforcing both state and federal regulations through an agreement
with CMS. The Office conducts complaint investigations and reviews of incidents that
nursing homes are required to report, and takes a variety of steps to enforce regula-tions
and ensure that corrective actions are taken. The Office’s responsibilities also
include technical assistance and education to nursing home staff and providing infor-mation.
Inspections—In Arizona, the Office enforces standards of care by inspecting the
State’s 139 nursing homes. In addition, it certifies two tribal facilities and monitors the
Arizona Pioneers’ Home. The Office inspects nursing homes between 9 and 15
months after the previous inspection.1 Inspections are unannounced and usually
take 4 to 5 days. Four of the State’s nursing homes are not Medicare- or Medicaid-certified
and, therefore, are not subject to federal certification requirements. However,
page1
1 The 15-month maximum is pursuant to 42 C.F.R. §488.308, which also requires that the state-wide average interval for
Medicare or Medicaid certification be no more than 12 months. The Office follows a similar time frame for nursing homes
that are not Medicare- or Medicaid-certified.
Office of the Auditor General
INTRODUCTION
& BACKGROUND
Nursing care institutions
are facilities that provide
continuous nursing serv-ices
to people who do
not require hospital care
or daily doctor’s care.
they must meet all state licensing standards, which generally parallel those for fed-eral
certification. The Office determines if nursing homes are meeting state and fed-eral
regulatory standards in the following areas:
l Quality of care—ensuring residents’ conditions improve to the extent possible or
do not deteriorate beyond what should be expected given their ages and med-ical
conditions;
l Quality of life—determining that facilities create and sustain an environment that
respects each resident’s humanity and individuality;
l Resident rights—providing residents with a dignified existence and self-deter-mination,
and ensuring adequate communication with and access to persons
and services outside the facility;
l Facility cleanliness—providing a safe, clean, comfortable, and home-like envi-ronment;
and
l Hazard-free environment—providing a physical environment that does not
endanger residents’ health.
Appendix A (see page a-iii) provides a complete list of the types of federal regulato-ry
standards.
Investigation of complaints—The Office investigates complaints against nurs-ing
homes related to quality of life and quality of care, including allegations of abuse,
dietary problems, denial of residents’ rights, and staffing and
environmental concerns. The Office receives complaints
from residents and their families, state agencies, and others.
The Office received over 700 complaints per year in fiscal
years 2000, 2001, and 2002. Most complaints come from
nursing home residents and their families, nursing home
employees, former employees, and managers. The Office
investigates all these complaints, and has recently eliminat-ed
a complaint investigation backlog. In addition, the Office
receives some referred complaints from Adult Protective
Services at the Department of Economic Security and the
Arizona Health Care Cost Containment System (AHCCCS).
Receipt of incidents self-reported by nursing
homes—In addition to complaints, the Office receives self-reports
from nursing homes, which are required to submit
reports of incidents ranging from minor issues such as prop-erty
loss to potentially very serious issues such as abuse and
neglect. Facilities may submit these reports by phone, but
page2
State of Arizona
Federal regulations require that states classify deficien-cies
into one of four categories according to severity:
Potential for Minimal Harm—with potential of no more
than minimal harm to residents;
Potential for More Than Minimal Harm—when minimal
harm, discomfort to residents, or the potential of actual
harm to residents occurs;
Actual Harm—where residents’ ability to reach their
highest physical and mental well-being is compro-mised;
or
Immediate Jeopardy—where residents are at immediate
risk of serious injury or death.
then must subsequently send in a written report of the investigation they have con-ducted.
Until recently, the Office did not count or track these incident reports,
although, based on a random sample of facility files, auditors estimate there may be
about 1,200 reports per year.1
Steps to ensure corrective action—The Office notifies nursing homes of reg-ulatory
violations, or deficiencies, identified during an inspection or complaint inves-tigation.
The Office classifies state and federal deficiencies according
to the number of residents affected (scope) and the seriousness of
the violation (severity). In most cases, including isolated deficien-cies
with the potential for minimal harm, a nursing home is required
to submit a plan of correction to the Office identifying how it plans
to correct the deficiencies and prevent future incidents.
The Office conducts follow-up inspections at nursing homes with
quality-of-care deficiencies, or any deficiencies that are not isolated or are more seri-ous
than having just the potential for minimal harm. If, during its follow-up inspection,
the Office notes that the nursing home failed to correct its deficiencies, the Office and
CMS have a variety of enforcement actions available to them. Specifically:
l For minor deficiencies—sanctions can include monitoring inspections to ensure
compliance and state-directed in-service training;
l For more serious deficiencies—the Office may take action against a facility’s
license, such as issuance of a provisional license or, as a last resort, suspension
or revocation. Moreover, it may impose financial penalties such as civil money
penalties up to $500 per day or a moratorium on new admissions, which can
have a significant financial impact on nursing homes. Additionally, CMS may
deny Medicare and Medicaid payments for new admissions or all residents,
and/or issue civil monetary penalties between $50 and $3,000 per day for these
violations; and
l For deficiencies that result in actual harm or place residents in immediate jeop-ardy—
the Office can suspend the facility’s license, install a temporary manager,
issue a provisional license, and impose civil money penalties up to $500 per day.
In addition to state penalties, CMS may order temporary management or termi-nate
Medicare or Medicaid certification. It also has the option of imposing civil
money penalties of between $3,050 and $10,000 per day.
In fiscal year 2002, federal civil money penalties were imposed five times, and denial
of payment for new admissions was imposed nine times. In addition, the Office
installed a temporary manager two times. According to Department officials, few
severe penalties were imposed because the number and seriousness of deficiencies
decreased from 2001 to 2002, as the Office conducted more inspections to reduce
its inspection backlog.
page3
Office of the Auditor General
1 The estimate is based on multiplying 141, the number of nursing homes in Arizona, by 8.5, the median number of self-reports
in the 30 randomly selected files.
The Office must determine the scope of
deficiencies, i.e., whether they are iso-lated,
constitute a pattern, or are wide-spread.
Under some circumstances, the law requires mandatory penalties. For example,
CMS must impose denial of payment for new admissions when a nursing home is
not in substantial compliance with required standards within 3 months after being
found out of compliance. Additionally, if a nursing home provides substandard care
for three consecutive inspections, the Office must monitor the home in addition to
denying payments for new admissions. Finally, if a nursing home places residents in
immediate jeopardy, federal regulations require that the State and CMS impose at
least one of the most severe sanctions.1
Organization, staffing, and budget
The Division of Assurance and Licensure Services is one of six divisions within the
Arizona Department of Health Services. The Division contains five offices, including
the Office, which regulates nursing homes. As of September 30, 2002, 52 full-time
equivalent positions were assigned to the Office. Thirty-six of these positions were for
surveyors who conduct nursing home inspections and complaint investigations. In
fiscal year 2000, the Office received funding for 8 additional surveyor positions, which
are included in the 36. The remaining employees comprise the Office’s management
and administrative staff.2
As illustrated in Table 1 on page 5, the Office received approximately $550,000 in fis-cal
year 2002 State General Fund appropriations. In addition, the Office received
about $2 million from CMS to administer its nursing home Medicare and Medicaid
certification inspection and investigation program.
Scope and methodology
This audit focused on the Office’s regulation of nursing homes through its complaint
and investigation practices, compilation and dissemination of public information, and
its licensing and inspection processes.
This audit includes three findings and recommendations as follows:
l The Office should improve its practices for investigating self-reported incidents
that involve nursing home staff and prioritizing complaints.
l The Office should continue to improve its filing practices and continue its efforts
to enhance its Web site.; and
page4
State General Fund pro-vides
only 18 percent of
the Office’s funding.
1 488 C.F.R. §488.410.
2 The Office also regulates intermediate care facilities for the mentally retarded (ICF/MR), which are not part of this audit.
State of Arizona
page5
Office of the Auditor General
Table 1 Office of Long-Term Care
Statements of Revenues, Expenditures, and Changes in Fund Balances
Years Ended June 30, 2000, 2001, and 2002
(Unaudited)
2000 2001 2002
Revenues:
Intergovernmental
Federal Title XVIII and XIX $1,812,042 $1,913,809 $1,968,130
Other 200,762 231,412 279,848
State General Fund appropriation 450,459 569,829 550,246
Fines and forfeits 21,158 216,330 199,672
Other 784 5,212 6,395
Total revenues 2,485,205 2,936,592 3,004,291
Expenditures:
Personal services and employee-related 1,659,989 1,801,459 2,043,000
Professional and outside services 1 161,784 174,292 155,122
Travel 151,283 149,398 135,934
Other operating 444,120 463,298 451,462
Equipment 51,226 127,385 12,461
Total expenditures 2,468,402 2,715,832 2,797,979
Excess of revenues over expenditures 16,803 220,760 206,312
Other uses:
Operating transfers out 2,690 245
Remittances to the State General Fund 784 5,212 12,156
Total other uses 784 7,902 12,401
Excess of revenues over expenditures and other uses 16,019 212,858 193,911
Fund balance, beginning of year 206,302 222,321 435,179
Fund balance, end of year 2 $ 222,321 $ 435,179 $ 629,090
1 Includes $155,000 paid each year to the Arizona State Board of Nursing. The Department of Health Services
contracts with the Board to meet certain federal requirements, such as preparing a register of nursing aides who
have completed a Board-approved training program.
2 Consists of unspent monies used to correct long-term care facility deficiencies related to residents’ health and
property. In accordance with A.R.S. §36-446.08, these monies were collected from long-term care facility
administrators or managers for certain violations.
Source: Auditor General Staff analysis of financial information provided by the Arizona Department of Health
Services for the years ended June 30, 2000, 2001, and 2002.
Table 1 The Office of Long Term Care
Statements of Revenues, Expenditures, and Changes in Fund Balances
Years Ended June 30, 2000, 2001, and 2002
(Unaudited)
l The Office should increase its use of available state sanctions against deficient
nursing homes to improve oversight and quality of care.
In addition, this report contains other pertinent information regarding states’ nursing
home staffing requirements and complaint investigation time frames.
Auditors used a variety of methods to conduct the audit: Interviewing Department
management and staff about its nursing home inspections and investigations as well
as its public information processes; and reviewing audit reports from Kansas,
Michigan, Pennsylvania, and California, as well as from the U.S. General Accounting
Office (GAO), regarding nursing home regulation, licensure, and oversight. In addi-tion,
the following specific methods were used:
l To assess whether the Office adequately addresses self-reported incidents and
appropriately prioritizes all complaints, auditors accompanied investigators on a
complaint investigation and observed their adherence to policies and proce-dures.
Auditors also obtained the number of self-reported incidents and com-plaints
from 30 randomly selected fiscal year 2002 facility files. Further, auditors
reviewed the Office’s complaint investigation and enforcement policies and pro-cedures
to assess the Office’s efforts to comply with federal and state man-dates;
l To assess the Office’s compilation and dissemination of public information,
auditors reviewed seven facility files; examined Web sites from Arizona and six
other states; interviewed an attorney who frequently uses facility files; inter-viewed
division staff and management; reviewed a study on federal and state
nursing facility Web sites1; and reviewed a 2000 Pennsylvania audit report;2
l To assess the Office’s use of state sanctions, auditors observed a license and
certification inspection, and reviewed calendar year 2000 and 2001 sanctions
from five inspection case files to identify the types of nursing home violations
and department sanctions. Additionally, auditors reviewed the Office’s sanction
log sheets from 1999 through 2001 to determine the frequency with which the
Office recommends sanctions and how often CMS approves the recommenda-tions.
Finally, auditors conducted interviews with officials from five other states
and CMS staff to gain their perspectives3; and
l To develop information on other states’ nursing home licensing standards, audi-tors
reviewed CMS quality indicators and its report to Congress on the appro-page6
Facility files contain
nursing home informa-tion
pertaining to state
licensing and
Medicare/Medicaid cer-tification,
both public
and confidential.
1 Charlene Harrington, Ph.D.; Eric Collier, B.S.N.; Janis O’Meara, M.P.A.; and Martin Kitchener, Ph.D.; University of
California, San Francisco. Lisa Payne Simon, M.P.H., California HealthCare Foundation; John F. Schnelle, Ph.D. Borun
Center for Gerontology Research, UCLA; Just What the Consumer Needs? Federal and State Nursing Facility Web Sites,
June 2002.
2 A Follow-up Performance Audit of Nursing Home Oversight in Pennsylvania, October 2000.
3 States contacted were California, Florida, Oregon, South Carolina, and Washington, which were identified as having the
best practices.
State of Arizona
priateness of minimum nursing home staffing ratios, the CMS State Operations
Manual, the October 2000 Pennsylvania follow-up performance audit of nursing
home oversight, a Kaiser Family Foundation staffing study1, and GAO reports
on the need for stronger complaint and enforcement practices and the inade-quacy
of complaint investigation processes.
This audit was conducted in accordance with government auditing standards.
The Auditor General and staff express appreciation to the director of the Department
of Health Services, and the management and staff of the Division of Assurance and
Licensure Services and its Office of Long Term Care, for their cooperation and assis-tance
throughout the audit.
page7
1 Charlene Harrington. Nursing Home Staffing Standards in State Statutes and Regulations. A survey for the Henry J. Kaiser
Family Foundation, April 2001.
Office of the Auditor General
page8
State of Arizona
Some investigation practices need improvement
To ensure that residents receive adequate quality of care, the Office should improve
its practices related to abuse and neglect incidents reported by nursing homes and
complaints reported by residents and their families. Although it investigates all com-plaints
it receives, the Office does not investigate all incidents reported by nursing
homes alleging abuse and neglect when staff may be involved. Federal regulations
require that all such incidents be investigated. Additionally, the Office does not con-sistently
prioritize complaints. In some cases, complaints alleging actual harm were
misclassified, delaying the Office’s investigation. The Office should investigate all
self-reported incidents of abuse and neglect involving nursing home staff and devel-op
detailed guidelines for complaint prioritization.
Self-reported incidents not always investigated
Although the Office protects the health and safety of nursing home residents by
investigating complaints from residents and their family members, it does not always
investigate incidents reported by nursing homes that involve abuse and neglect by
nursing home staff. Additionally, until recently, the Office did not track or log the num-ber
of self-reported incidents received. The Office should investigate all of these staff-related
abuse and neglect incidents, as required by federal regulations and similar to
practices in other states, and take corrective action to ensure hazards to resident
health and safety are eliminated. However, the Office’s investigative response may
be limited by staff vacancies, which cannot be filled due to a hiring freeze. Finally, the
Office recently acquired a new complaint-tracking system it can use to track these
incidents.
Not all incidents are investigated—The Office does not investigate all
incidents of abuse and neglect reported by nursing homes. Nursing homes are
required by law to report any such incidents to the Office within 5 days. Facilities ini-tially
phone in details of the incident and subsequently send in a written investigation
page9
Uninvestigated incidents
can lead to abuse or
neglect of residents.
Office of the Auditor General
FINDING 1
report. Federal regulations require that states investigate allegations of resident neg-lect
and abuse when there is oral or written evidence to believe that staff providing
resident services could be involved in such incidents.1
Despite the importance of investigating abuse and neglect incidents involving nurs-ing
home staff, a review of records from 30 randomly selected nursing homes found
no evidence that the Office had investigated several incidents reported by those
homes. In at least 35 incidents alleging resident neglect or abuse and involving staff,
the Office had no record of conducting any investigation. For example:
l A family member voiced concern to facility administration about a staff Certified
Nursing Assistant (CNA) who was gruff and uncaring toward residents in the din-ing
room and would not provide assistance when asked. The CNA was seen
forcefully shaking a resident’s wheelchair to wake her and then pushing her into
bed. The incident report indicates that nursing home employees were aware of
the CNA’s previous inappropriate behavior. However, only after the resident’s
family threatened action and demanded the CNA’s termination did the nursing
home fire the CNA for inappropriate conduct and poor service. The Office did
not conduct any further review to determine, for instance, whether a lack of CNA
training or supervision led to this incidence.
The Office should investigate all staff-related abuse and neglect inci-dents—
To address serious self-reported incidents adequately and to comply with
federal regulations, the Office should investigate all staff-related abuse and neglect
incidents received from self-reports and take appropriate action to ensure the nurs-ing
homes correct deficiencies. Although limited staffing may preclude on-site inves-tigation
of all such incidents, the Office may be able to conduct some investigations
without making on-site visits, based on the severity of the incident and history of the
nursing home in preventing abuse and neglect. For example, the Office may be able
to conduct some investigations through telephone interviews with nursing home staff
and examination of documents provided by the home. In some cases, the Office may
be able to limit its efforts by thoroughly examining the nursing home’s internal inves-tigation
of the incident, assessing its completeness and credibility, and documenting
its conclusion that an Office investigation would only duplicate the home’s own
efforts. However, according to a CMS official, self-reported allegations of staff-relat-ed
abuse and neglect will usually require investigation by the Office itself.
Once current staff and resource limitations have eased, the Office should consider
following practices used in two other states, where officials reported they do more in
response to self-reports. The Office currently has 9 vacant surveyor positions it can-not
fill due to a hiring freeze, affecting its ability to initiate any new efforts. However,
an official from the state of Washington, cited for many best practices by CMS staff,
reported that its investigation rate for self-reports, including abuse incidents that do
not involve nursing home staff, is 60 percent or more. Additionally, California’s policy
page10
1 42 CFR 488.335.
State of Arizona
is to conduct an on-site investigation within 24 hours of receiving any self-report that
indicates abuse, neglect, or resident harm. When the Office has returned to full
staffing in the future, it should consider adopting similar policies regarding investiga-tion
of abuse and neglect incidents.
Software and a lack of clear policies have limited past investigation
response—In addition to staff limitations, inadequate software and a lack of clear
policies have contributed to the Office’s inadequate investigation practices. Because
the Office’s complaint-tracking system did not allow data entry of self-reported inci-dents,
investigators could not use it to identify nursing homes with repeat incidents
that might help them determine the extent of investigation needed when a new inci-dent
is reported. Homes report a wide variety of incidents in addition to the staff-relat-ed
abuse and neglect incidents that require investigation. In auditors’ review of 30
facilities’ files, one home had 50 self-reported incidents, and another had 46. While
these high numbers could suggest the homes were more conscientious about
reporting incidents to the Office, they might also indicate recurring problems that
should be addressed. In October 2002, the Office implemented a new complaint-tracking
system provided by CMS, and has begun to record self-reported incidents
as well.
The Office lacks written policies instructing staff to investigate self-reported abuse
and neglect incidents involving nursing home staff. It needs to modify its complaint
policy to formalize and clarify the policy for handling self-reported incidents, includ-ing
the requirement to investigate every self-report that involves staff abuse or neg-lect.
Complaint prioritization inconsistent
In addition to not investigating some incidents reported by nursing homes, the Office
does not consistently prioritize all complaints received from residents, their families,
and others. In some instances, complaints alleging actual harm were misclassified,
resulting in investigation delays. The Office should provide investigators with clear
guidelines to follow, addressing situations unique to the Office, to alleviate this prob-lem.
The Office sets complaint priorities—To satisfy its complaint-handling respon-sibilities,
the Office’s complaint team receives and classifies complaints about nursing
homes into four priorities, each of which has a specified number of days within which
an investigation must begin (see Table 2, page 12). Categories 1 and 2 are the high-est
priorities, with investigation time frames that match federal requirements. They
include incidents such as when an individual is intimidated and/or threatened, physi-cally
abused, sustains a fracture from a fall caused by inadequate supervision or neg-lect,
dies unexpectedly or without explanation, or is injured due to inappropriate use
page11
Office of the Auditor General
of restraints or inadequate staffing. The State also defines category 3 incidents, which
are those that do not compromise resident health or safety, and category 4 incidents,
which are all other incidents, such as those outside the Office’s jurisdiction that are
referred to other agencies.
Priorities not always assigned consistently—The Office does not uniformly
prioritize complaints with similar issues, which can adversely affect resident health
and safety. A CMS 2001 performance review for Arizona’s Long Term Care program
examined 18 complaints and found 9 that involved actual harm (priority 2), but were
misclassified as priority 3 and, therefore, were not investigated promptly. Additionally,
in a review of 30 randomly selected facility files, auditors found similarly misclassified
complaints. The 30 files contained 119 complaints, 34 of which were classified as pri-ority
3. At least five of these complaints met the definition for priority 2 because they
involved potential risks to residents’ health and safety. For example:
! A resident was left unattended on the patio and appeared to be ill when staff
later found him. He was found to be suffering from heat exhaustion and was sent
to the hospital for evaluation. The resident’s guardian alleged that the facility, by
failing to monitor this resident, caused the problem.
page12
State of Arizona
Table 2 Complaints Received by Priority
Year Ended June 30, 2002
Priority
Definition of Priority
Number of
Complaints1
Investigation
Time Frame
1 Immediate and serious threat to health and safety
has caused or may cause serious injury, harm,
impairment, or death
10 Within 2 working days (federal
requirement)
2
Actual harm that does not rise to level of immediate
and serious threat, or where severe hazards to
health and safety may exist
398
Within 10 working days
(federal requirement)
3 Risk to health and safety is not an issue 294 Within 45 working days (state
guideline)
4 Does not meet the definitions for priorities 1 to 3. For
example, the complaint is not in the Office’s
jurisdiction
24 None
1 Auditor General staff determined the number of complaints by analyzing information provided by the Office of
Long Term Care from its Complaint Tracking System FY2002 database.
Source: Arizona Department of Health Services, Division of Assurance and Licensure Services, Complaint
Process.
l A resident with diabetes, kidney problems needing dialysis, and Alzheimer’s dis-ease
was wheelchair bound and unable to self-propel or feed herself. The fam-ily
voiced its concerns about her weight loss and three separate falls that
occurred. Four days after they expressed their concerns to the nursing home,
the resident went into a diabetic coma, was hospitalized, and died of respirato-ry
arrest. The family alleged that the facility failed to prevent falls, did not assess
the resident’s condition when her blood sugar was abnormal, and failed to feed
her knowing she needed total assistance with her meals.
Lack of detailed guidelines may hamper prioritization—The Office’s
inconsistent prioritization of complaints may stem from its lack of specialized guide-lines
to help its investigators apply existing policies. The Office uses DHS, Division of
Assurance and Licensure Services policies that describe complaint procedures for
all programs within the Division, but do not address situations unique to the Office.
These policies define each complaint priority but the Office may need to develop
more detailed supplementary guidelines to promote consistent priority assignment
among investigators. For example, the guidelines could provide examples illustrating
how to apply the policies in situations the Office may encounter. During the audit, the
Office made staff changes in an effort to address the problem with prioritization.
Recommendations
1. To better protect the health and safety of nursing home residents and to comply
with federal regulations, the Division of Assurance and Licensure Services
should:
l Revise its complaint policy to clarify and formalize the policy for handling
self-reported incidents; and
l Investigate all self-reported abuse and neglect incidents involving nursing
home staff, and document its conclusions regarding the credibility and
completeness of the home’s internal investigation if it relies on that investi-gation
to help it reach its own conclusions.
2. To help ensure more consistent practices for assigning complaint priorities, the
Office should develop detailed guidelines specific to the long-term care pro-gram
to supplement and explain existing policies for assigning complaint prior-ities.
page13
Office of the Auditor General
Improperly categorizing
complaints can
adversely affect resi-dents’
health.
page14
State of Arizona
page15
Office of the Auditor General
FINDING 2
The Office should provide more public
information
The Office needs to improve the way it compiles and disseminates information to the
public. To evaluate nursing homes adequately, nursing home residents and their fam-ilies
need quality-of-care information. However, the Office’s public files do not always
include all public information and the information that is available is not always under-standable.
The Office should continue its efforts to improve the information it pro-vides
to the public over the telephone and on its Web site.
Information needed for decisions
In addition to the cost and service information they obtain from nursing homes, resi-dents
and families need information regarding nursing homes’ quality of care in order
to make informed decisions. For example, they may be interested in deficiencies
identified at inspections as important quality indicators. Further, they might judge the
level of resident and family dissatisfaction with a nursing home by the numbers and
types of complaints it receives. Moreover, the public can determine the severity with
which the Office views violations through reviewing its enforcement actions.
Some information incomplete or unclear
The Office’s current system for filing and providing information does not allow the
public access to information that is adequate, understandable, and meaningful for
making decisions about nursing homes. In its filing system, some documents that
should be available to the public are placed in nonpublic files. In addition, some doc-uments
that are made available have so much information expunged that they are no
longer understandable or meaningful. The Office has submitted a proposed statuto-ry
change to help alleviate this problem. Finally, the ratings the Office provides about
Public information pro-vides
insights into nurs-ing
home quality.
page16
State of Arizona
nursing home quality are not explained well, although proposed changes in the rat-ing
system should help make them clearer.
Some public documents not in public files—The Office keeps information
on each nursing home in four separate files: Public, Confidential, Medicare/Medicaid,
and Inspectors’ Documents. Generally, only the public file is made available for pub-lic
inspection. However, information that should be available to the public is some-times
placed only in the other files. The Office does not have complete and clear poli-cies
explaining what documents belong in each of the four files.
Placing public information only in nonpublic files makes it very difficult for residents
and families to obtain useful information. For example, the Office does not place fed-eral
enforcement information in the public files. Further, although the Office does
have a policy that calls for Statements of Deficiencies and Plans of Corrections to be
in the public files, auditors found cases where these documents were only in other
files. As a result, public file reviews can leave residents and families with incomplete
and inaccurate impressions of nursing home quality of care.
Office documents not always understandable—Documents the Office
makes available to the public are not always decipherable. A copy of the investiga-tion
report is available in the public file, but it is often severely edited so it lacks essen-tial
information such as dates and the nature of the incident. Sometimes the Office
expunges information in these reports beyond what state or federal law requires.
Such practices can make it difficult—or impossible in some cases—for residents and
families to evaluate a facility by reviewing public files. For instance, one investigation
report that had been heavily edited for the public file stated the following facts:
The Office has submitted a proposed statutory change that would conform state
statutes to federal laws. Currently, A.R.S. §36-404 mandates redacting all med-ical
information, which may contribute to staff uncertainty over what they should
not redact and leave in the public record. The proposal submitted to the
Incomplete public files
inhibit residents and
families from making
informed decisions.
“On (deleted), (name of CNA), CNA was observed to (deleted)
Resident (deleted) to (deleted) by having (deleted). The (deleted)
CNA, (deleted) is (deleted). This was reported to the administrator,
DNS and social worker this morning, (deleted). The administrator
counseled the observing/reporting CNA (deleted) to report incidents
immediately. The facility will fax the completed report. The facility will
notify the ombudsman, APS, the physician, the family, and the Arizona
State Board of Nursing.”
“Staff failed to report alleged CNA (deleted) to Administration for six
days.”
Governor on December 2, 2002, would require eliminating personally identifiable
information but not other information. Whether or not the statute is changed, the
Office needs to better train its staff on editing documents in compliance with
state and federal patient privacy laws without removing information that should
remain available to the public.
Rating system classifications can be misunderstood —In addition to not
always providing information the public should have, some information the Office
provides can be easily misunderstood. For example, the Office’s quality ratings do
not present a clear understanding of a nursing home’s quality of care. The Office
inspects each nursing home and gives one of three performance quality ratings
defined in the Administrative Rules: excellent, standard, or substandard, based on a
40-point quality rating score. A nursing home’s rating may not equate to the quality
of care it gives. For example, an excellent quality rating shows only that the nursing
home met minimal standards in at least 90 percent of the measured categories, but
a member of the public might believe it means the nursing home offers excellent
quality of care. To improve the usefulness of its quality ratings, the Office has devel-oped
a revised rating system, with four possible ratings, based on a point system that
relies more on quality of care instead of on meeting minimum standards. It submit-ted
rules outlining its new system to the Governor’s Regulatory Review Council on
November 15, 2002.
The Office should continue improving telephone and
Web site information
The Office should continue to enhance its methods of disseminating public informa-tion
over the telephone and on the Internet. Currently, the public cannot obtain some
important public information via the telephone or Internet. Other states provide pub-lic
information in a more concise, understandable format, such as by giving nursing
homes report cards or performance ratings, which make it easier to identify nursing
homes that provide quality care. To make information more readily accessible to the
public, the Office should provide staff with telephone protocols and training, and
build on its Web site improvements.
Information not easily accessible by telephone—Office staff provide only
limited information over the telephone. For example, residents and families calling the
Office can receive nursing homes’ names, addresses, telephone numbers, and qual-ity
ratings. However, they must visit the Office’s Phoenix or Tucson locations to obtain
information regarding complaints, inspection results, deficiencies, or enforcement
actions against a nursing home. Alternatively, much of this information is available
from links through the Office’s Web site, or by visitiing the nursing home itself, which
is required to make information about deficiencies arising from inspections or com-plaint
investigations available for review.
page17
Office of the Auditor General
Ratings information can
be difficult to under-stand.
Public information over
the telephone is limited.
Limited staff resources and its former inadequate complaint-tracking system have
affected the Office’s ability to provide complete information over the telephone. Too
much staff time would be required to locate information in the Office’s files in
response to telephone inquiries. However, the Office implemented a new CMS com-plaint-
tracking system as of October 1, 2002. This should enable its staff to quickly
look up the number, nature, and disposition of complaints. The Office should ensure
its staff are trained to use the new system in order to provide publicly available infor-mation
over the telephone.
The Office should continue efforts to expand and simplify Web site
information—The Office has made recent improvements to its Web site, although
some information is still not easily accessible. In recent months, the Office has imple-mented
substantial changes, such as adding state enforcement actions and altering
the design to make site navigation easier. It has also established a committee to rec-ommend
further Web site improvements and has sought input from division staff. The
Office is also participating in a state-wide effort to improve information availability for
aging citizens. This effort also involves the Department of Economic Security and
AHCCCS and is expected to result in improved Web site information at all three agen-cies.
The Division should continue its efforts to improve its Web site. For example,
Web site users must follow several links to obtain information, and it is not always
clear what information is available at each link. For example, most specific informa-tion
about homes is provided through a link to the CMS Web site, but state enforce-ments
and other information, including quality rating, is found only on the Office’s
Web site. The Office has submitted a budget decision package requesting resources
for Web site improvements. As resources become available, the Office should con-tinue
to add public information to its Web site and provide more descriptive links to
aid the public in accessing available information.
Auditors identified a number of other states’ Web sites that provide public informa-tion
in a concise, understandable format. The Pennsylvania Department of Health’s
Web site was particularly comprehensive and easy to use. It posts several items that
can help potential residents and their families make informed decisions. The Web site
provides a list of facilities that have dedicated Alzheimer’s units or are part of a larg-er
continuing-care facility. In addition, for each nursing home in the state, it provides
the number of licensed beds, the number that are Medicare- and/or Medicaid-certi-fied,
and the number of citations received in each of ten categories, and compares
the home’s performance against the state average and homes of similar size. Finally,
it reproduces Statement of Deficiencies and Plan of Correction forms, provides a
detailed narrative explanation of the incident resulting in the deficiency finding, and
posts the Code of Federal Regulations and Pennsylvania Administrative Code cita-tions
violated by the nursing home. The Office could consider using Pennsylvania’s
Web site as a model as it continues its efforts to improve its own.
page18
State of Arizona
Other states’ Web sites
are more user-friendly.
Recommendations
1. The Office should ensure that all public information, including meaningful infor-mation
about complaints and sanctions, is available to members of the public
who review nursing home files in person at the Office, by:
a. Revising its policies and procedures regarding what documents should be
placed in the public file; and
b. Providing training to staff on the new policies.
2. The Legislature should consider revising A.R.S. §36-404 to conform state
statutes to federal laws regarding the redacting of information.
3. To provide adequate information to members of the public over the telephone,
the Office should train staff how to use the new CMS complaint-tracking system
to access the number, nature, and disposition of complaints in order to respond
to telephone inquiries.
4. The Office should continue its efforts to improve its Web site by adding public
information not currently included and providing more descriptive links to infor-mation.
page19
Office of the Auditor General
page20
State of Arizona
page21
Office of the Auditor General
FINDING 3
The Office can use state sanctions more often
Although the Office performs some aspects of its quality assurance well, it should
use available state sanctions more often against noncompliant nursing homes. The
Office, which is responsible for ensuring quality of care in nursing homes, does a
good job of conducting inspections on a timely basis, following acceptable stan-dards
to evaluate care, and using standard CMS guidelines on citing facilities.
However, the Office does not always use the state sanctions available to it, choosing
instead to request the federal government to impose penalties. Using state sanctions
offers an opportunity to encourage facilities’ more immediate compliance, in part
because federal sanctions can go through an extended appeals process.
The Office performs some inspection aspects well
The Office performs some areas of its state and federal inspections well. The Office
has improved its inspection timeliness in the last 2 years, and it uses acceptable
standards for inspections and consistently recommends sanctions for violations.
l According to office administrators, in fiscal year 2000, inspector shortages con-tributed
to an average of 15 months between inspections, although federal stan-dards
require a 12-month average. An Office report shows that as of January
2000, at least 1 home went 23 months between inspections. After the Office
hired eight additional inspectors, the state-wide average for number of months
between inspections decreased to 13.2 months in fiscal year 2001, and 11.3
months in fiscal year 2002.
l  The Office uses state and federal standards to evaluate quality of care. For
example, inspectors assess homes for problems, such as lack of treatment for
pressure sores, the presence of accident hazards, and the existence of signifi-cant
medication errors.
The Office conducts
timely inspections that
meet federal and state
requirements.
l  The Office’s manager review process helps ensure that it recommends sanc-tions
using consistent criteria. Managers review inspection results and propose
sanctions based on written guidelines.
The Office could make more use of state sanctions
While the Office consistently proposes sanctions against nursing homes that are out
of compliance with federal and state law, in most cases, it recommends that the fed-eral
government impose penalties rather than assessing state sanctions. As a result,
some facilities may avoid sanctions, either because CMS elects not to impose a fed-eral
sanction, or because nursing homes use the federal appeals process to post-pone
the penalty. Other states have made greater use of their own penalties and
shorter appeals processes.
The Office usually recommends noncompliant facilities for possible
federal sanctions—While there are several state penalties available to the
Office, it usually only recommends federal sanctions. The Office has a variety of state
penalties that differ according to the violation’s seriousness, including requiring that
all staff receive training, levying fines, suspending or revoking licenses, and issuing
provisional licenses that are conditional on the facility maintaining compliance with
federal and state requirements. For the 32 violations since 1999 that involved actual
harm or immediate jeopardy to residents, the Office issued provisional licenses three
times and entered into one stipulated agreement with a nursing home in which tem-porary
management was installed.
Rather than sanctioning noncompliant facilities itself, in most cases, the Office rec-ommends
that CMS impose federal penalties. For example, if a facility does not cor-rect
problems found at an inspection or incurs a serious violation regarding health
and safety, the Office will recommend that CMS assess the facility a penalty such as
a fine or denial of federal payments for new residents. When imposed, some of these
federal sanctions are severe. For example, a denial of payment for new admissions
can have a serious financial impact on a nursing home. However, where appropriate,
the Office should make greater use of state sanctions in addition to federal sanctions.
Some facilities may avoid penalties due to the State’s reliance on
federal enforcement—The Office’s reliance on recommending federal penal-ties
means that some facilities the Office believes should receive sanctions may in
fact avoid penalties altogether, or at least delay them for a long time. One reason is
that CMS does not always impose the recommended penalty. In 2001, CMS did not
take action against at least five nursing homes after the Office recommended penal-ties
instead of imposing any state sanctions. When CMS does not act, the facility is
usually only required to ensure that its staff take in-service training. Even if CMS
agrees with an office recommendation and imposes a civil fine, nursing homes may
page22
State of Arizona
The Office underutilizes
state sanctions.
Deficient nursing homes
may avoid penalties.
be able to postpone the action for a considerable period if they choose to appeal.
Under CMS procedures, nursing homes do not have to pay this penalty until they
exhaust appeals, which can take years. Currently, two Arizona cases are under
appeal in the federal system, and both are more than 2 years old. Federal appeals
generally take longer than the state appeals process. Department officials report that
only two nursing homes have appealed federal sanctions since 1995.
Other states make stronger use of penalties—Some states use state penal-ties
more extensively. For example, according to Washington state officials, its
Department of Social and Health Services often uses state civil fines because it
believes it can enforce them more quickly than CMS can enforce its penalties.
Further, Washington uses state sanctions more than federal penalties. It usually fines
noncompliant nursing homes that demonstrated actual harm to residents, and may
suspend new admissions to facilities for other serious violations. Similarly, Florida’s
office can set a moratorium on new admissions as one of its penalties, and it now
imposes mandatory fines for serious care or injury violations in addition to recom-mending
federal sanctions to CMS.
Recommendation
1. To provide greater opportunity to ensure that nursing homes comply with regu-lations,
the Office should make greater use of state sanctions, where appropri-ate,
in addition to recommending the home for federal sanctions.
page23
Office of the Auditor General
page24
State of Arizona
page25
Office of the Auditor General
OTHER PERTINENT
INFORMATION
During the audit, auditors developed information about other states’ nursing home
licensing standards. Some states, including Arizona, have standards that exceed
federal certification standards. Most commonly, these standards involve staffing
requirements that are more specific than the federal standard. However, currently
nursing shortages and nursing homes’ financial hardship could make such require-ments
impractical. Some states have adopted licensure requirements that exceed
federal standards to a greater degree than Arizona’s. Unlike Arizona, some states
also have more rigorous complaint inspection deadlines than those called for under
federal standards.
Some states have additional staffing standards
Because research has shown that staffing levels affect quality of care, many states
have adopted additional staffing regulations beyond the federal standards. Several
healthcare studies have shown that there is a relationship between staffing and qual-ity
of care. Most states, including Arizona, have adopted at least some staffing
requirements that exceed federal requirements. The additional requirements vary
from state to state, with some states adopting more requirements than Arizona.
Healthcare studies have linked staffing with improving nursing home
care—Many healthcare studies have found that staffing affects nursing homes’ abil-ity
to provide quality care. For example, two studies in 2000 reported that staffing was
a systematic factor affecting care, and that healthcare professionals have viewed the
federal staffing requirement as inadequate and recommended higher staffing levels
for patients with greater care needs.1,2 Additionally, researchers for a 2001 CMS
report to Congress observed 17 nursing care facilities and reported that quality-of-care
problems emerged when inadequate numbers of staff were available.3 Finally,
a GAO report of selected states found that nursing homes providing more nursing-care
hours per resident were less likely to have repeated serious problems.4
1 A Follow-up Performance Audit of Nursing Home Oversight in Pennsylvania, October 2000.
2 “Experts Recommend Minimum Nurse Staffing Standards for Nursing Facilities in the United States”: The Gerontologist,
2000.
3 Appropriateness of Minimum Nurse Staffing Ratios in Nursing Homes. CMS Report to Congress, Phase II Final, 2001.
4 Nursing Homes: Quality of Care More Related to Staffing than Spending. Report to Special Committee on Aging and
Committee on Finance, U.S. Senate, June 2002. GAO-02-431R.
page26
State of Arizona
Nursing shortage may hinder ability to meet minimum staffing
ratios—An important consideration in evaluating the feasibility of minimum staffing
ratios is whether an adequate workforce exists to allow nursing homes to meet high-er
required levels. In a 2000 report to Congress, CMS reported that a nursing short-age
existed and that there were reasons to believe the shortage would increase over
time. For example, enrollments in nursing schools have decreased in recent years
and the population is aging at a rate that is expected to increase the demand for
nursing services in nursing homes and other healthcare facilities. CMS estimated that
the implementation of maximum quality standards would result in 97 percent of nurs-ing
homes failing to meet one or more of the standards. It may be difficult for the
State to establish minimum staffing ratios under current conditions. Additionally,
according to DHS officials, the financial conditions of some nursing homes could
prevent them from meeting higher staffing ratios even if nurses were available to fill
the positions.
States have established additional staffing requirements for licen-sure—
Despite the difficulty of enforcing minimum staffing requirements, some
states, including California and Florida, have developed and enforce staffing require-ments
that go beyond the federal standards. Federal certification requirements state
that nursing homes must provide “sufficient staff” for service to residents and a reg-istered
nurse for 8 hours each day. Some states have established requirements that
are more specific—for example, requiring nursing homes to increase the number of
minimum staffing hours for registered nurses, or developing specific staffing hour
requirements for licensed practical nurses and nursing assistants.
l Several states, including Arizona, have implemented overall minimum staffing
requirements that go beyond the federal standards or clarify what “sufficient
staff” means in the State. According to a 2001 survey 13 states have done so
since 1999.1 For example, Florida’s staffing regulations require homes to have
at least one licensed nurse for every 40 residents. Florida issues both state and
federal citations to nursing homes that fail to meet staffing requirements,
according to one Florida official. Arizona’s regulations prohibit a licensed nurse
from providing care to more than 64 residents. In California, nursing homes with
more than 100 beds must have a registered nurse on duty 24 hours a day, com-pared
with the federal standard of 8 hours a day.
l Thirty-three states have specific staffing requirements for nursing assistants and
other direct care nursing staff, that is, staff providing actual care to residents
such as bathing, giving medications, and observing residents. For example,
Florida’s statutes require homes to have at least one nursing assistant for every
20 residents. Arizona has not adopted any specific minimum staffing standards
for nursing assistants.
1 Charlene Harrington. Nursing Home Staffing Standards in State Statutes and Regulations. A survey for the Henry J. Kaiser
Family Foundation, April 2001.
States have developed additional care regulations
In addition to staffing regulations, Arizona and other states have developed other
care-related regulations. Arizona’s additional requirements relate to fingerprinting of
all staff providing care, and tuberculosis testing for all employees.
Some states have developed regulations to shorten the time frames for complaint
response. CMS requires that states investigate a priority 1 complaint, in which imme-diate
jeopardy is alleged, within 2 working days and a priority 2 complaint, or allega-tion
of actual harm, within 10 working days. Because failure to investigate complaints
promptly can delay the identification of serious problems in nursing homes and post-pone
needed corrective actions, some states strengthen the federal requirements by
shortening the time frame for investigation.1 For example, according to a 1999 GAO
report, nursing home regulatory agencies in Louisiana, Kansas, and Michigan must
investigate immediate jeopardy situations within 24 hours.2 Further, Pennsylvania cat-egorizes
all complaints as “priority” or “general.” It initiates priority complaint investi-gations
onsite within 24 hours and general complaint investigations within 2 calendar
days. Arizona has not adopted shorter time frames for investigation, but uses the
same time frames as CMS for investigating priority 1 and 2 complaints.
page27
Office of the Auditor General
1 Nursing Homes: Complaint Investigation Processes Often Inadequate to Protect Residents. U.S. General Accounting
Office. Report to the Chairman and Ranking Minority Member, Special Committee on Aging, U.S. Senate. GAO/HEHS-
99-80, March 1999.
2 Scanlon, William J. Nursing Homes: Stronger Complaint and Enforcement Practices Needed to Better Ensure Adequate
Care. U.S. General Accounting Office. Testimony before the Senate Special Committee on Aging. GAO/T-HEHS-99-89,
March 1999.
page28
State of Arizona
pagea-i
Office of the Auditor General
APPENDIX
page a-ii
State of Arizona
page a-iii
Office of the Auditor General
Appendix 1 Federal Quality-of-Care Regulations for Nursing Homes
The facility must provide the necessary care and services to attain or maintain the highest practical physi-cal,
mental, and psychosocial well being, in accordance with the comprehensive assessment and plan of
care.
Facility will prevent pressure sores if none exist on admission and provide treatment if sores are present.
Facility must provide each resident with sufficient fluid intake to maintain proper hydration/health.
Facility must see residents receive treatment such as injections, parenteral and enteral fluids, colostomy, tra-cheostomy
care, respiratory care, foot care, and prostheses.
Facility must ensure it is free of medication error rates of 5 percent or greater.
Facility must ensure residents are free of any significant medication errors.
Resident’s abilities in activities of daily living do not diminish unless unavoidable due to clinical condition.
Includes resident’s ability to bathe, dress, and groom; transfer and ambulate; toilet; eat; and use speech
and language.
Resident’s regimen must be free from unnecessary drugs.
Resident environment remains as free from accident hazards as is possible.
Resident receives adequate supervision and assistance devices to prevent accidents.
Resident maintains acceptable body weight and protein levels.
Resident receives a therapeutic diet when there is a nutritional problem present.
Resident who is incontinent receives appropriate treatment and services.
Resident with limited range of motion receives appropriate treatment and services.
Resident with mental or psychosocial adjustment difficulty receives appropriate treatment/services to cor-rect
assessed problem.
Resident who could previously eat alone is not fed by tube unless unavoidable due to clinical condition.
Resident does not show a pattern of decreased interaction unless unavoidable due to clinical condition.
Resident will have no catheter unless necessary because of clinical condition.
Resident who is fed by tube receives necessary treatment/services.
Resident will have no reduction in range of motion unless unavoidable due to clinical condition.
Residents who have not used antipsychotic drugs are not given these drugs unless the therapy is neces-sary
to treat specific condition as diagnosed/documented in clinical record.
Residents who use antipsychotic drugs receive gradual dose reductions and behavioral interventions in
effort to discontinue drugs.
Source: Centers for Medicare and Medicaid Services, State Operations Manual, Guidance to Surveyors, Appendix P.
pagea-iv
State of Arizona
Office of the Auditor General
AGENCY RESPONSE
State of Arizona
Office of the Director
1740 W. Adams Street JANE DEE HULL, GOVERNOR
Phoenix, Arizona 85007-2670 CATHERINE R. EDEN, DIRECTOR
(602) 542-1025
(602) 542-1062 FAX
December 26, 2002
Debra K. Davenport
Auditor General
2910 N. 44th Street
Phoenix, Arizona 85008
Dear Ms. Davenport:
Thank you for an opportunity to respond to your audit of the Department of Health
Services’ Office of Long Term Care (“Office”). We agree with all of the report’s
findings. In addition, we agree to implement all of its recommendations, where
applicable.
We are pleased that the report highlights many of the Office’s accomplishments. The
report notes that inspection timeliness has improved over the past two years, and that
inspections are now performed within federal standards. The report also recognizes that
the Office investigates all of the complaints it receives. The Department takes great pride
in these accomplishments, given that our workload has steadily increased over the last
two years. Indeed, the average number of facility beds regulated per surveyor has
increased from 634 in June 2000 to 854 in November 2002.
With regard to the specific recommendations made in your audit, the response contained
in the attached document is provided
Thank you for this opportunity to respond to your office’s report. We appreciate the
professionalism and responsiveness demonstrated by you and your staff throughout this
audit.
Sincerely,
Catherine R. Eden
Director
Attachment
Arizona Department of Health Services
Response to Recommendations Contained in the
Office of the Auditor General Performance Audit of the Office of Long Term Care
Recommendation:
To better protect the health and safety of nursing home residents and to comply with
federal regulations, the Division of Assurance and Licensure Services should:
· Revise its complaint policy to clarify and formalize the policy for reporting self
reported incidents.
Response: The finding of the Auditor General is agreed to and the audit recommendation
will be implemented.
Comment: In recent months the Division of Assurance and Licensure Services (Division)
has worked hard to update many of its Policies and Procedures related to the licensure
and complaint investigation processes. We will ensure that these Policies and Procedures
continue to be refined, and carried down to the Office level.
· Investigate all self-reported abuse and neglect incidents involving nursing home staff,
and document its conclusions regarding the credibility and completeness of the
home’s internal investigation if it relies on that investigation to help it reach its own
conclusions.
Response: The finding of the Auditor General is agreed to and the audit recommendation
will be implemented.
Comment: We agree with the report’s assertion that the Office should investigate all self-reported
incidents of abuse or neglect involving nursing home staff. We believe that we
already do conduct such investigations, oftentimes over the phone, as the report suggests
is appropriate. However, we believe that we need to do a better job of documenting such
investigations.
Recommendation:
To help ensure more consistent practices for assigning complaint priorities, the Office
should develop detailed guidelines specific to the long-term care program to supplement
and explain existing policies for assigning complaint priorities.
Response: The finding of the Auditor General is agreed to and the audit recommendation
will be implemented.
Comment: Guidelines specific to the Office that supplement and explain Division
Policies and Procedures developed and updated in recent months will be will be
developed and implemented.
Recommendation:
The Office should ensure that all public information, including meaningful information
about complaints and sanctions, is available to members of the public who review
nursing home files in person at the Office, by
· Revising its policies and procedures regarding what documents should be placed in
the public file; and
· Providing training to staff on the new policies.
Response: The finding of the Auditor General is agreed to and the audit recommendation
will be implemented.
Comment: Policies and Procedures specific to information to be included in public files
will continue to be developed and updated in accordance with existing State and Federal
Requirements. As these Policies and Procedures are developed and updated, training will
be provided to staff.
Recommendation:
The Legislature should consider revising A.R.S. §36-404 to conform state statutes to
federal laws regarding the redaction of information.
Response: The finding of the Auditor General is agreed to and the audit recommendation
will be implemented.
Comment: We fully support the report’s recommendation that the Legislature consider
changing redaction requirements for nursing home information. The Department has
proposed legislation to make such changes to statute, allowing us to better provide
needed consumer information.
Recommendation:
To provide adequate information to members of the public over the telephone, the Office
should train staff how to use the new CMS complaint-tracking system to access the
number, nature, and disposition of complaints in order to respond to telephone inquiries.
Response: The finding of the Auditor General is agreed to and the audit recommendation
will be implemented.
Comment: Training has already been initiated to assist staff in utilizing the CMS
complaint-tracking system. This training will be continued to ensure that staff can use
the software to provide needed telephonic information to the public.
Recommendation:
The Office should continue its efforts to improve its Web site by adding public
information not currently included and providing more descriptive links to information.
Response: The finding of the Auditor General is agreed to and the audit recommendation
will be implemented.
Comment: We are grateful that the report recognizes recent improvements made to our
Web site. State enforcement information is now available on the site, and a link provides
easy access to federal enforcement information found on the Centers for Medicare and
Medicaid Services Web site, allowing consumers access to the information they need to
make informed decisions when choosing a nursing home. We will continue to make
improvements to our Web site, as the report suggests. We have recently proposed a
budget decision package that would allow us to make further Web site improvements.
Recommendation:
To provide greater opportunity to ensure that nursing homes comply with regulations, the
Office should make greater use of state sanctions, where appropriate, in addition to
recommending the home for federal sanctions.
Response: The finding of the Auditor General is agreed to and the audit recommendation
will be implemented.
Comment: We agree that the Office should use state sanctions as an enforcement tool.
However, it is important to note that while civil money penalties are often considered to
be the primary sanction available there are a number of other remedies that are also
available, and statutes do not require the imposition of such penalties. (See A.R.S. § 36-
431.01). Capping facilities’ ability to enroll Medicare clients is a powerful enforcement
tool, since it has a significant impact on facilities’ bottom lines. In addition, federal fines
are quite significant, oftentimes mirroring state civil money penalties. Thus, the
imposition of state civil money penalties in addition to federal penalties can amount to
“overkill.” The Office is continually balancing the need to appropriately enforce existing
regulations against the knowledge that many facilities are financially fragile.
01-21 Board of Nursing
01-22 Department of Public Safety—
Criminal Investigations Division
01-23 Department of Building and
Fire Safety
01-24 Arizona Veterans’ Service
Advisory Commission
01-25 Department of Corrections—
Arizona Correctional Industries
01-26 Department of Corrections—
Sunset Factors
01-27 Board of Regents
01-28 Department of Public Safety—
Criminal Information Services
Bureau, Access Integrity Unit,
and Fingerprint Identification
Bureau
01-29 Department of Public Safety—
Sunset Factors
01-30 Family Builders Program
01-31 Perinatal Substance Abuse
Pilot Program
01-32 Homeless Youth Intervention
Program
01-33 Department of Health
Services—Behavioral Health
Services Reporting
Requirements
02-01 Arizona Works
02-02 Arizona State Lottery
Commission
02-03 Department of Economic
Security—Kinship Foster Care
and Kinship Care Pilot
Program
02-04 State Parks Board—
Heritage Fund
02-05 Arizona Health Care Cost
Containment System—
Member Services Division
02-06 Arizona Health Care Cost
Containment System—Rate
Setting Processes
02-07 Arizona Health Care Cost
Containment System—Medical
Services Contracting
02-08 Arizona Health Care Cost
Containment System—
Quality of Care
02-09 Arizona Health Care Cost
Containment System—
Sunset Factors
02-10 Department of Economic
Security—Division of Children,
Youth and Families, Child
Protective Services
02-11 Deparatment of Health
Services—Health Start
Program
02-12 HB2003 Children’s Behavioral
Health Services Monies
Performance Audit Division reports issued within the last 12 months
Future Performance Audit Division reports
Government Information Technology Agency—State-wide Technology Contracting Issues
Department of Commerce