OSC Releases Updated List of Lowest Performing Nursing Homes

Following OSC’s recommendation, NJ Department of Human Services has begun withholding quality incentive payments to one-star facilities.

  • Posted on - 09/8/2022


TRENTON – In an update to its February 2022 report on lowest-rated nursing homes participating in New Jersey’s Medicaid program, the Office of the State Comptroller (OSC) has released a report that identifies 12 facilities that have consistently received one star ratings.  Nine of those facilities also appeared on the list when the original report was issued. New Jersey’s Medicaid program paid $107 million annually to these 12 facilities.

“New Jersey’s Medicaid program continues to provide substantial funding to nursing homes despite their longstanding failure to improve the safety and quality of their care,” said Acting State Comptroller Kevin Walsh. “These one-star facilities have received hundreds of millions of Medicaid dollars while being repeatedly cited for serious health and safety issues.”

Positive Changes to Quality Incentive Program

As recommended by OSC in its February report, New Jersey’s Department of Human Services (DHS) recently modified a program that incentivizes high quality care by nursing homes.  The Quality Incentive Payment Program (QIPP) provides bonus payments to facilities that meet or exceed specific quality measures. Beginning July 1, 2022, DHS implemented changes to QIPP eligibility standards. Under the new standards, none of the 12 lowest-rated LTCs was eligible to receive any QIPP payments in state fiscal year (SFY) 2023.

OSC’s approach to the data

The current list of lowest-rated LTCs includes nursing homes that have received the lowest CMS overall rating of one-star in the first month of each quarter for six of the past eight quarters from October 2020 to July 2022. OSC’s February 2022 report found that New Jersey had 15 LTCs that met these criteria. Since that report was issued, 6 LTCs moved off the list and 3 new LTCs joined the list. Nine LTCs are on both lists. One of the 9 LTCs on both lists was recently shut down.

The care of over 1,800 people

OSC’s February report found that one-star nursing homes in New Jersey cost Medicaid over $100 million each year for the care of approximately 1,850 beneficiaries. Updated data shows the amount has increased to $107 million per year for approximately 1,835 beneficiaries. All of those facilities are operated by for-profit companies that failed to improve conditions on a sustained basis for years. OSC released a digital dashboard alongside the report which includes a resources section where beneficiaries and caretakers can explore facility data.

Ratings are based on issues found during health inspections, quality measures reported by nursing homes, and the number of nursing staff. Health inspectors show up unannounced to a nursing home and spend several days evaluating resident rights and quality of life at the facility.

“While I’m glad to see change in a positive direction, there’s more work to be done,” said Acting State Comptroller Kevin Walsh. “We urge the State to take actions that will improve conditions for all residents in nursing homes, including those who are on Medicaid. We should reward nursing home operators who improve their quality of care and penalize those that consistently fail to do so. We will continue to update our findings and share with the public the actions agencies have taken to push for better quality of care for all nursing home residents.”

To report government fraud, waste, mismanagement or corruption, file a complaint with OSC or call 1-855-OSC-TIPS.

The Office of the State Comptroller (OSC) is an independent State agency that works to make government in New Jersey more efficient, transparent and accountable. OSC is tasked with examining all aspects of government expenditures, conducts audits and investigations of government agencies throughout New Jersey, reviews government contracts, and works to detect and prevent fraud, waste and abuse in Medicaid.

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