By Peter Eisler
WASHINGTON - The chairman of the U.S. Senate Aging Committee is urging Medicare and Medicaid officials to adopt stricter oversight policies for the special trust accounts that nursing homes use to safeguard residents' money.
In a letter to Marilyn Tavenner, administrator of the U.S. Centers for Medicare and Medicaid Services, Sen. Bill Nelson, D-Fla., urged the agency to require that nursing home inspectors review the trust accounts annually for evidence of theft or mismanagement. He also urged CMS to see that the inspectors receive additional training to spot potential problems with the accounts.
Nelson made the request in the wake of a USA TODAY investigation, published in October, which found that thousands of nursing home residents have had their savings stolen or misused while held in the trust accounts.
"USA TODAY's article ... revealed an alarming number of cases involving unscrupulous and dishonest employees of nursing homes who siphoned, forged and swindled millions of dollars from the trust fund accounts of unsuspecting and helpless residents," Nelson wrote. He noted the newspaper's finding that there is no requirement that annual nursing home inspections include a review of records on resident trust accounts.
Sen. Charles Grassley, R-Iowa, a senior member of the Senate Finance Committee, which oversees Medicare and Medicaid, also raised concerns. In a written statement, he urged that federal regulators work together with their state counterparts and industry officials to help solve the oversight problem.
"The solutions might be a combination of state, federal and industry initiatives," Grassley said. "I sincerely hope this is not a situation where several agencies, both state and federal, are rushing to shout, 'We're not it!' If no one is able to step forward and claim responsibility to address this, congressional action through legislation may be necessary."
Nursing home inspections generally are performed by state "surveyors." The federal government provides funding to the states to perform the reviews, and federal rules set requirements for what those surveys cover - everything from medical care to billing practices. States can layer on additional requirements if they choose.
Nursing homes and other long-term care providers for the elderly and disabled are required to maintain the trust accounts for residents who request that the facility hold their money. The funds are supposed to work like conventional bank accounts, with accrued interest and regular statements. But USA TODAY found that they often are mismanaged.
"CMS does not require state agencies to train surveyors on how to identify improper or suspicious withdrawals from these accounts, nor is it clear that the surveyors are required to look for this type of problem," Nelson wrote. "I ask that you require ... that surveyors be provided with the training they need to detect improper expenditures from these trust funds, and that these withdrawals be routinely reviewed."
Last month, CMS said it is considering whether additional oversight is needed to address theft and mismanagement of residents' funds. When asked about USA TODAY's findings, agency spokesman Aaron Albright said, "We are aware of this situation and are reviewing the (inspection) procedures used to detect these kinds of problems."
The agency declined to comment specifically on Nelson's letter, saying it had nothing immediate to add.
USA TODAY's investigation identified scores of cases in which employees - usually business or office staff - siphoned huge sums of money from trust accounts, hundreds of thousands of dollars in some instances, for everything from shopping and gambling sprees to routine household expenses. In more than 1,500 other cases, federal records showed, facilities failed to pay interest on the funds, could not account for their holdings, or did not carry adequate insurance to protect the money from loss or theft.
Because the funds are supposed to be insured, residents whose money is stolen or mishandled typically get reimbursed. But USA TODAY found that the confusion and emotional damage that residents suffer when their savings are mishandled can last well beyond the time that the funds are restored.
Nelson initially requested that the Office of the Inspector General at the U.S. Department of Health and Human Services examine the problem and recommend any necessary changes in oversight of the trust accounts. However, the inspector general said it is currently unable to take on the review, citing an array of other health care-related investigations that already are underway.
Greg Crist, senior vice president of the American Health Care Association, a nursing home industry group, says theft and mismanagement of residents' funds is not a major problem in the nation's 16,000 nursing homes. Still, he says, the industry is concerned about it and has launched initiatives to raise awareness and better train administrators and staff to spot improprieties.
Crist also notes that many nursing home operators audit the trust accounts on their own initiative.
In a follow-up story last month, USA TODAY found that just four states have gone beyond CMS to require that nursing home surveys include audits or detailed reviews of resident trust accounts. Also, while nearly every state requires that nursing homes do criminal background checks on all care-giving staff, 20 states don't extend that requirement to the office and administrative staff who usually manage the trust funds.