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Request A Call HereBefore 1987, nursing homes were poorly regulated. Each State had its own set of rules, but these were rarely enforced and largely ineffective. Residents suffered across the board, subjected to unsafe facilities and sub-standard care. Congress tried and tried, and tried again, to create binding regulations, but State governments battled federal authority at every turn.
Then, the Institute of Medicine published its influential study, Improving the Quality of Care in Nursing Homes. The report changed everything. In its pages, Federal and State regulators could clearly see the perilous position in which most nursing home residents lived as a matter of course.
And worse, the problem was the government's fault, the result of fifty years of inaction and misguided failure.
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Congress was spurred to change.
The "Nursing Home Reform Act" was quickly drafted and passed into law in 1987. This law presented the rights of nursing home residents in clear, legally-binding terms for the first time.
Nursing homes were now required, by federal law, to ensure that their residents were provided all the foundations of a high quality of life: physically, psychologically and socially.
In order to maintain this quality of life, nursing homes must:
Every nursing home resident has the right to:
Money, of course. Congress made it explicit: if you fail to follow the rules, you won't receive payments from Medicaid and Medicare. According to the American Association of Retired Persons (AARP), nursing homes can only receive federal funds if they are certified by their state "to be in compliance with the requirements of the Nursing Home Reform Act." Nursing homes are inspected, without advance notice, at least once every 15 months.
That's a really big deal, and it's worth taking a closer look.
In 1998, the year the Nursing Home Reform Act was passed, nursing homes received 58% of their 
total income through federal programs. Obviously, cutting off such a huge source of revenue would have forced any elder-care facility to shut its doors.
We wanted to know if it would still be such a huge loss, so we checked the data sets at the Centers for Medicare & Medicaid Services. Turns out it would probably be an even bigger hardship.
The past two decades have seen state governments take a more active role in subsidizing nursing homes. But Medicaid and Medicare still cover roughly 52% of all the income that flows to elder-care facilities.
After factoring in State and local resources, only 12.5% of nursing home income comes from private health insurance policies or out of resident's pockets. If a nursing home loses its certification, it stands to lose almost 88% of its revenue as well.
Forty years before the Nursing Home Reform Act, around 1950, Congress ordered State governments to create licensing programs that would ensure a certain standard of care. But in an odd move, the legislative body failed to specify any standards. Not one.
At the same time, federal funding began to pour into nursing homes nationwide.
Studies conducted in the 50s found that almost 60% of nursing home residents received public assistance from the federal government.
With this increase in financial involvement, the government turned its eye to ensuring the quality of care in these homes.
The States had all cobbled together their own sets of nursing home regulations, but none were very good.
Congress created multiple review boards to inspect facilities from State to State, and the results were troubling. Wide disparities in quality and outcome needed to be addressed:
With these results, Congress was ready to act. The Public Health Service went to work, studying each State's licensing program and slowly developing a comprehensive set of guidelines.
In 1963, the Nursing Home Standards Guide was released. But Congress didn't yet have the legal authority to make their rules legally binding, and problems persisted. Most crucially, States were still unwilling to enforce their various regulations:
In 1965, Medicaid and Medicare were passed into law, and a new flow of revenue became available to nursing homes. But in order to sign on, Congress forced skilled nursing facilities to accept a new set of regulations. These rules were far more rigorous, and a little unrealistic.
Out of 6,000 nursing homes that applied for federal funds in 1965, only 740 were fully approved. In other words, an overwhelming 88% failed to meet the health and safety standards set out by Congress.
Federal regulators let some slide-by, 3,000 actually. These homes were said to be in "substantial compliance," which is the equivalent of saying, "you get the point. We'll work on those messy details later."
For the rest, those 2,260 facilities that failed altogether? Congress simply turned regulatory authority back over to the States.
Over the next 5 years, Congress tried several new tactics to increase nursing home compliance, including creating a new type of facility with limited responsibilities. Existing homes could re-designate themselves as "intermediate care facilities," and offer residents a narrower range of services. This made it easier to meet the government's standards.
But most of the time, legislators were wrapped up in hearings, arguing over the how far their influence could legally extend.
In 1970, two high-profile tragedies focused the nation's attention on the state of nursing homes. In Ohio, a fire killed 32 residents. In Maryland, an outbreak of food poisoning killed 36.
New reports from the Senate Finance Committee found widespread corruption. Many states were reclassifying their nursing homes as intermediate care facilities, without ensuring that the homes reduced their offered services to federally-mandated levels. Others had simply disregarded Congress' new regulations, and continued to approve nursing homes based solely on their own State-level rules.
After investigating facilities in three states, the US General Accounting Office concluded that half violated standards for staffing, physician visit and fire safety. Even so, they were receiving Medicaid funding.
President Nixon made an impassioned speech, condemning the substandard conditions of nursing homes throughout America. He committed himself to stopping the flow of federal dollars to facilities that could not follow the rules.
Nixon raised the bar. In 1972, he eliminated the distinction between "intermediate care facilities" and "skilled nursing facilities." Now, all nursing homes would be held to the same standards. Of course, these standards had yet to be written.
It was only in 1974 that the new nursing home regulations were released. Many were critical - these new laws seemed more general, less stringent than before. And while intermediate care facilities were subject to the same licensing procedures as skilled nursing facilities, they were not held to the same standards.
All in all, Nixon's attempts to reform nursing homes looked very much like a failure.
In 1974, a newly-created federal agency, the Office of Nursing Home Affairs (ONHA), began (another) large-scale investigation. Instead of focusing on a nursing home's physical plant, its employees' qualifications or institutional framework, the ONHA looked simply at its residents and their quality of care.
Shocking as it may sound, this was revolutionary. No one had thought to look at the patients who live in a nursing home, rather than at the nursing home itself.
ONHA found a similar problem in the way States were licensing and certifying elder-care facilities:
States had been evaluating nursing homes on whether or not they could provide quality services. They never looked at whether or not nursing homes did provide these services.
The ONHA devised a fix, a new way of assessing quality of care called the "Patient Appraisal and Care Evaluation" (PACE). The ONHA wanted to use this new measuring stick to evaluate every nursing home. If the results were good, a facility was eligible to receive federal reimbursement. If not, they couldn't get funds from Medicaid or Medicare.
In the end, PACE became "too complex" to use. It was published only as a voluntary guideline. Nursing homes could use it to evaluate their own level of patient care, but didn't need to. And while PACE was a failure, the change in perspective that had brought it into being was just what the nursing home industry needed.
Over the next decade, federal and state regulators made numerous attempts to change the now complex set of rules and guidelines overseeing nursing home standards and compliance.
Each new initiative failed in its own way, but each also contained the seeds of a solution. Regulators had finally realized that nursing homes are about people, not institutions.
In 1983, Congress stopped working on nursing home regulation. They realized that, instead of leading clearly with foresight, they were stumbling in the dark. They tasked the Institute of Medicine (IOM) with a simple, overwhelming project: tell us what's wrong with nursing homes and how we can fix it.
The IOM study would only be finished three years later, in 1986. Its recommendations provided the foundation for the Nursing Home Reform Act, passed the next year.
This history drew substantially from the Institute of Medicine's "History of Federal Nursing Home Regulation," published initially in Improving the Quality of Care in Nursing Homes.
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