California AG claims large nursing home chain manipulated CMS star ratings

(Photo by Pichsakul Promrungsee/EyeEm/Getty Images)

California prosecutors filed a lawsuit on Monday against Brookdale Senior Living, claiming the nursing home chain knowingly manipulated the Centers for Medicare and Medicaid Services star rating system to "lure prospective patients and their families to its facilities."

Brookdale is among the largest senior living community operators, with more than 68,000 facilities across the nation, according to Argentum. The lawsuit pertains to Brookdale's California skilled nursing facilities in Bakersfield, Camarillo, Carlsbad, Northridge, Rancho Mirage, San Diego, San Dimas, San Juan Capistrano, Santa Rosa and Yorba Linda.

The prosecutors claim that up until April 2018, Brookdale submitted false staffing information to CMS, specifically by inflating registered nursing hours, which led to "undeserved higher star ratings in the 'RN staffing,' 'staffing' and 'overall' categories on CMS's website," according to the lawsuit.

After April 2018, when CMS updated how it gathered its star rating data, Brookdale began falsifying its payroll data to continue to mislead the agency, prosecutors claim.

Additionally, the lawsuit accuses Brookdale of illegally transferring and discharging residents "so it can fill its beds with residents who will bring in more money."

By law, skilled nursing facilities must provide adequate notice before discharging or transferring a resident. The suit claims Brookdale initiated "tens of thousands" of discharges and transfers without providing timely notice and without preparing residents for the move.

"As a result of these actions, Brookdale endangered the health of its patients and also left families scrambling to find other places to care for their loved ones," the lawsuit announcement said.

The lawsuit seeks civil penalties of $2,500 per violation and an injunction to prevent future unlawful conduct.

WHY THIS MATTERS

CMS issues its star ratings to help individuals and their families and caregivers choose and compare a skilled nursing facility. It rates facilities from one to five stars, ranging from quality of care that is much below average to much above average, based on health inspections, staffing and quality measures.

Although CMS star ratings are how many consumers choose where to live and receive care, studies have begun poking holes in the system.

One suggests that the Nursing Home Compare website doesn't reflect patient safety. The report says that while one and five-star ratings are typically good indicators of a facility's patient safety measures, those in the middle have "no meaningful" differences in adverse safety events.

Another found that individuals who were dually enrolled in Medicare and Medicaid tended to reside in facilities with lower quality ratings. The researchers suggest that this could lead to growing gaps in quality care for an already particularly vulnerable group.

Further, a portion of the information CMS uses to base its ratings on is provided directly from facilities, and a substantial amount of it is false and misleading, according to a recent investigation by The New York Times.

Despite the claims against Brookdale, the nursing home operator denies it "engaged in intentional or fraudulent conduct," a spokesperson told The Times.

THE LARGER TREND

This isn't the first time Brookdale has faced scrutiny for its star ratings. In 2016, four of the company's home health agencies received five-star ratings from CMS but received no more than two stars in patient experience ratings.

Studies show that when nursing homes improve their star ratings, they subsequently gain patient admissions. These results show that by improving CMS ratings nursing homes can cushion their bottom lines.

False reporting has led experts to call on CMS to use objective data to evaluate nursing homes.

During the pandemic, CMS required nursing homes to take certain infection-control measures to receive full funding from the Coronavirus Aid, Relief, and Economic Security Act.

California's Attorney General Xavier Becerra is also President Biden's pick for secretary of Health and Human Services. His nomination faced opposition among Republicans for his record on abortion rights and past support for "Medicare for all," but the senate voted last week to advance the nomination forward.

ON THE RECORD

"We are holding Brookdale accountable for artificially increasing its profits by cutting corners when transferring or discharging its patients. It lured individuals to its facilities through false promises about providing the highest quality care," said California Attorney General Xavier Becerra.

"Choosing a skilled nursing facility is no simple task. Seniors, people with disabilities and their families rely heavily on accurate data to make that decision. Californians have been directly impacted by Brookdale's behavior. We will ensure that they face consequences for violating the public's trust."

Twitter: @HackettMallory
Email the writer: mhackett@himss.org