Ownership and Additional Disclosable Party Information on LTC “Providers and Suppliers”

Posted on April 27, 2023 by Mark Schulz

On May 1, 2023, the Centers for Medicare and Medicaid Services (CMS) will publish an Information Collection Request (ICR), a request for public comment on a specific topic, as part of a proposed rule about revising the Medicare hospital inpatient prospective payment system.

Earlier this year, CMS issued a proposed rule regarding their concerns about the quality of care furnished by private equity company-owned (PEC) and real estate investment trust-owned (REIT) nursing homes and the need for transparency regarding such owners. This proposed rule is known as the nursing home disclosures rule.

With this IRC, CMS states the “concerns about PEC and REIT are not limited to SNFs but extend to other provider and supplier types. Given the linkage … between PEC and REIT ownership and a decline in nursing home quality, we believe it is very important for us to collect this information from all providers and suppliers that complete the Form CMS-855A so as to: (1) determine whether a similar connection exists with respect to non-SNF providers and suppliers; and (2) help us take measures to improve beneficiary quality of care to the extent such connections exist.”

Defining PEC and REIT

Within the currently proposed nursing home disclosures rule, a few critical definitions are:

• PEC - a publicly traded or non-publicly traded company that collects capital investments from individuals or entities (investors) and purchases an ownership share of a provider (for example, SNF, home health agency, etc.).
• REIT - a publicly traded or non-publicly traded company that owns part or all of the buildings or real estate in or on which the provider operates.

CMS seeking input on ownership models

Specifically, CMS is interested in hearing reactions and suggested revisions about:

• The appropriateness of the “private equity company” and “real estate investment trust” definitions proposed in the nursing homes proposed rule
• Whether CMS’ proposed definition of private equity company should include publicly traded private equity companies.
• Feedback regarding other types of private ownership besides PECs and REITs about which CMS should consider collecting information from providers and suppliers as part of the enrollment process.

Members with such entities may be interested in this information collection request. As with many federal administrative actions, this request for information collection will likely lead to a notice of proposed rulemaking (NPRM) when CMS determines its initial approach to this topic. That notice will require no less than a 30-day comment period before CMS can officially publish its “final” rule on the subject.  Generally, there is time between the end of the NPRM and when the final rule is officially published.  A final rule is generally effective no less than 30 days after its final publication.

You can read the information collection request for more information.  [Note, this document is 1500+ pages in length.  You will want to skip to pages 1191-1192 and 1237-1239 for this matter.]

Please contact Mark Schulz, mschulz@leadingagemn.org, with questions.