The Lead June 26, 2025 - LeadingAge Illinois

From the Desk of Angela Schnepf, President and CEO

Nursing and Rehabilitation:
DOJ Submits Notice of Appeal in Staffing Mandate Lawsuit
July Training from the Center of Excellence for Behavioral Health in Nursing Facilities
Census Data Due to IDPH by September 1
CMS Releases QSO Memo on Changes to 5-Star Report and Care Compare
OIG Adds Evaluation of Medical Directors’ Engagement to Work Plan
Federal Judge Rules in Favor of LeadingAge State Affiliates
Regulatory Review – F567 Protection of Resident Funds
Illinois Nursing Home Survey Trend Update
CMS Releases New Technical Details on HOPE

Housing:
HUD Announces HOTMA Delay to 2026 for Multifamily Housing

HCBS:
CMS Announces New Home Health and Hospice RAC Contract
Home Health & Hospice Star Trend Reports Now Available

Other:
Ask the Expert

From the Desk of Angela Schnepf, President and CEO

Congress is writing its Department of Housing and Urban Development (HUD) funding bills for fiscal year (FY) 2026. President Trump has asked Congress to cut HUD funding—so let Congress know the vital importance of federally assisted housing programs and the need to preserve and expand affordable housing for older adults. Click here to contact Congress and urge their support of HUD funding.

Kindest Regards,

Angela

House Removes Employee Retention Tax Credit Provision from Budget Reconciliation Bill

During a June 11 floor session, the House of Representatives approved an amendment to the One Big Beautiful Bill Act (OBBB), the tax and spending package passed by the House on May 22, that makes certain changes needed to ensure compliance with Senate rules and preserve the Senate’s ability to bypass the filibuster when the body brings its own budget reconciliation bill to the floor. Among other changes, the House amendment removes a section from the OBBB relating to the Employee Retention Tax Credit (ERTC). Current law allows employers to claim COVID-related ERTC through April 15, 2025. Section 112205 of the OBBB would have barred the Internal Revenue Service (IRS) from issuing any additional unpaid claims, unless a claim was filed on or before January 31, 2024, and it would have established certain program integrity requirements and penalties aimed at COVID-ERTC promoters.

The removal of this provision, which was intended to generate budget savings that helped offset the cost of the overall bill, means that employers who submitted claims through April 15, 2025, can still get paid. Senate Republicans will make their own changes to the House bill, but the ERTC issue and others needed to be addressed before the House official sent their bill to the other chamber. You can stay up to date with all budget reconciliation news in this serial post.

Fraudulent Fax Alert Issued by CMS

The Centers for Medicare & Medicaid Services (CMS) issued a fraudulent fax phishing alert. The alert details a scheme targeting Medicare providers where scammers impersonate CMS and send phishing fax requests. The phishing fax requests medical records and other documentation indicating the targeted provider is being audited. CMS reminds providers that they do not initiate audits by requesting medical records via fax. If you are targeted by suspicious activity, including this kind of phish, providers should work with their review contractor to understand if a request is verifiable.

Medicare Advantage Prior Authorization Changes on the Horizon

On June 23, the U.S. Department of Health and Human Services (HHS), Centers for Medicare & Medicaid Services (CMS) and a group of health insurers – including United Healthcare, Aetna, Humana, and a group of Blue Cross & Blue Shield plans announced they would be streamlining, simplifying, and reducing prior authorizations within Medicare Advantage (MA) plans and other insurance products. However, what sounds like MA plans finally taking responsibility for the flawed, burden-some system of prior authorizations, in many cases, is just the plans saying they will comply with regulatory requirements that were finalized in recent years and that take effect in 2026 and 2027.

The MA plans have committed to standardize electronic prior authorizations; reduce the number of prior authorizations required and respond in real-time to prior authorization requests (when all needed clinical documentation is included). It remains to be seen how the implementation of these changes will impact the burden on post-acute care providers. On a positive note, the HHS and CMS actions would suggest they intend to see the previously finalized rules governing these prior authorization changes implemented and enforced. LeadingAge, along with the Post Acute Care Coalition Partners, will be meeting with CMS on July 9 to discuss prior authorization practices, ideas for further improvements, and these latest developments.

CMS Releases QSO Memo on 2567 Transparency

On June 18, the Centers for Medicare & Medicaid Services released QSO-25-19-All related to procedural changes for survey agencies releasing the CMS-2567 form upon completion of a survey for all provider types. Previously, survey agencies had up to 90 days after the completion of the survey to publicly release the CMS-2567 or until the plan of correction (POC) or Allegation of Compliance (AOC) was approved. CMS notes that this also delayed the release of important quality and safety findings to the public.

CMS is updating the practice to allow the release of the CMS-2567 immediately upon receipt by the provider, supplier, or lab. While the release timeframe for the CMS-2567 is being shortened, the review period is not changing.

CMS Implements Permanent Approach to Fraud, Waste & Abuse

The Centers for Medicare & Medicaid Services announced on June 17 the intention of making the Fraud Defense Operations Center (FDOC) pilot a permanent approach to crushing Medicare & Medicaid fraud, waste, and abuse. According to the announcement, the FDOC pilot from March 31 – May 1, 2025, saved $105 million by detecting, stopping, and preventing fraud waste and abuse. You can read the fact sheet on the pilot’s achievements along with visiting the Crushing Fraud, Waste, & Abuse website.

Upcoming IDPH Webinars

The Illinois Department of Public Health announced the following upcoming webinars. Registration is required and attendance is limited. If you’re unable to attend, email Michael.moore@illinois.gov as the webinar will be recorded and can be distributed following the event.

Vaccine Storage and Handling on June 27 from 1 – 2 p.m.
QAPI in Long-Term Care on July 11 from 1 – 2 p.m.
Dialysis in Long-Term Care on July 25 from 1- 2 p.m.
Hot Topics in Public Health on August 8 from 1 – 2 p.m.
Contractor Toolkit on August 22 from 1 – 2 p.m.

DOJ Submits Notice of Appeal in Staffing Mandate Lawsuit

On June 2, the Department of Justice (DOJ) submitted a notice of appeal in the United States District Court for the Northern District of Texas following the Court’s April 7 ruling in favor of the LeadingAge lawsuit to vacate the Centers for Medicare & Medicaid Services (CMS) federal staffing mandate for nursing homes. The lawsuit was filed by American Health Care Association, LeadingAge, the Texas Health Care Association, and several Texas providers. LeadingAge is awaiting the next step in the appeal process, which will entail the Court establishing a briefing schedule.

July Training from the Center of Excellence for Behavioral Health in Nursing Facilities

The Center of Excellence for Behavioral Health in Nursing Facilities (COE-NF) is hosting several trainings in July for nursing home providers. You can register at the links below for these free training opportunities!

Question, Persuade, Refer (QPR) Suicide Prevention – July 10 from 1 – 2:30 p.m. CT. and July 30 from 1- 2:30 p.m. CT.
Understanding Psychosis: Differentiating Schizophrenia from Psychotic Symptoms Due to Medical and Neurological Conditions in Nursing Facilities on July 17 1 – 1:45 p.m. CT. and July 24 1- 1:45 p.m. CT
Not Just Schizophrenia: Exploring Psychosis Tied to Substance Use in Nursing Facilities on July 22 from 1 – 1:45 p.m. CT.
Mental Health First Aid (MHFA) on July 25 from 10 a.m. – 3:30 p.m. CT
Non-pharmacological Interventions for Psychotic Symptoms due to Schizophrenia and Other Psychotic Disorders on July 29 from 1 – 1:45 p.m. CT

Census Data Due to IDPH by September 1

Illinois Department of Public Health (IDPH) issued a SIREN notice on June 24, reminding nursing home providers of the upcoming census report quarterly due date. The third quarter report (April 1 – June 30, 2025) is due no later than September 1, 2025 and must be submitted to IDPH by emailing it to DPH.LTCDailyCensus@illinois.gov. If you have any questions or technical difficulties, please email the same email address.

CMS Releases QSO Memo on Changes to 5-Star Report and Care Compare

On June 18, the Centers for Medicare & Medicaid Services (CMS) released QSO-25-20-NH related to 5-Star reports and updates to the Care Compare website. The changes are outlined below.

Nursing Home Chains

Beginning September 26, 2022, CMS began publishing ownership data on data.cms.gov. As part of that release, CMS linked together nursing homes that had common owners and control as “affiliated entities” or “chains”. Additionally, in June 2023, CMS posted average ratings and performance measures by affiliated entities or chains on the cms.data.gov website. The next phase of this transparency effort will be implemented on July 30, including publishing performance information including average overall 5-star ratings, health inspection, staffing, and quality measure ratings for each chain directly on the Nursing Home Care Compare website. This will allow a more consumer-friendly format to allow individuals to make more informed decisions on their care.

Health Inspection Star Rating

Previously, the nursing home health inspection star rating was calculated based on an allocated point value weighed over three survey cycles. CMS notes due to a backlog of surveys with the COVID-19 pandemic surveys may be more than 45 months old and still used to calculate the health inspection star rating. Beginning with the July 2025 refresh, CMS will no longer use the three-survey cycle period for recertification surveys but will calculate the score based on the two most recent survey cycles. The weights will be measured based on 75% of the value from Cycle one including the most recent standard survey and any complaint and infection control surveys completed in the past 12 months. The second cycle will be weighed at 25% and include the second most recent standard survey along with any complaint and infection control surveys from the last three years. CMS notes that this will likely not impact many providers but will emphasize the most recent survey performance.

Updated Long Stay Antipsychotic Quality Measure Calculation

The Office of Inspector General (OIG) issued a report in 2021 identifying that the Minimum Data Set (MDS) which is currently being used to calculate the percentage of antipsychotics used in the nursing home was not accurately reflecting the number of residents who were currently prescribed antipsychotic medications. Based on knowledge of how the measure is calculated, this could include nursing homes not coding an antipsychotic on the MDS or inaccurately coding a diagnosis of schizophrenia. To mitigate this, CMS is updating the measure to include both MDS and claims data to calculate the percentage of residents using antipsychotic medications.

For example, if a resident does not have an antipsychotic medication coded on the MDS, but based on claims data, Medicare is billed for an antipsychotic medication, then the resident will be included in the numerator for the measure. Additionally, if the resident receives an antipsychotic medication and is excluded based on the MDS coding of a schizophrenia diagnosis, but the claim data does not support ongoing care for schizophrenia, the resident will not be excluded from the numerator as they would have been previously.

Removal of the COVID-19 Vaccine Percentages

CMS began displaying the resident and staff vaccination percentages for the COVID-19 vaccine in 2021 on each nursing home’s Care Compare page. However, beginning July 30, 2025, CMS will no longer post this metric on the main profile page of each nursing home.

OIG Adds Evaluation of Medical Directors’ Engagement to Work Plan

In an updated work plan released June 16, the Health & Human Services (HHS) Office of Inspector General (OIG) announced that it will be evaluating the engagement of medical directors in nursing homes. “Monitoring Nursing Homes’ Engagement of Medical Directors” will examine the following:

The extent to which medical directors performed required duties in nursing homes.
The extent to which payroll-based journal (PBJ) data on medical director hours are accurate and useful for oversight.
Opportunities to improve oversight and transparency of nursing homes’ engagement and funding of medical directors.

This news comes at a time when medical directors are coming under higher scrutiny during the survey process as well. The report is expected to be issued in Fiscal Year 2026. You can see all active items on the OIG work plan here.

Federal Judge Rules in Favor of LeadingAge State Affiliates

On June 18, federal judge Leonard T. Strand issued a ruling in favor of the plaintiffs to vacate the Centers for Medicare & Medicaid Services (CMS) staffing standards included in the final rule. The plaintiffs, including 17 LeadingAge State affiliates, two Kansas nursing home providers, and 20 states attorneys general filed to vacate the staffing mandate final rule in its entirety. Similar to the case in Texas filed by LeadingAge and American Health Care Association (AHCA), the plaintiffs argued that CMS lacks the statutory authority to issue such a rule, that the rule is contrary to law, and the provisions are arbitrary and capricious. Judge Strand ruled in favor of the plaintiffs as it relates to the minimum staffing hours and the 24/7 RN requirements. However, Judge Strand ruled in favor of HHS/CMS regarding the facility assessment and state Medicaid reporting requirements.

Regulatory Review – F567 Protection of Resident Funds

Continuing in the residents’ right section of Appendix PP includes F567 which tells nursing home providers that residents have the right to manage their own financial affairs. This includes what charges the nursing home may impose against their personal funds (such as transportation services). You cannot require that residents deposit any personal funds into an account with the nursing home (such as if you feel like this would be the safer option). If they choose to deposit funds within your trust account, they must agree to this in writing, and the nursing home is expected to hold, safeguard, and manage for those funds including providing an accounting of fund usage and availability. These funds must be separated from business accounts.

The resident must have access to their funds in a timely manner. While a timely manner is not immediately, it is expected that the resident can access their funds whenever they desire to do so, including evenings, weekends, and holidays. The interpretative guidance indicates that residents must be able to access requested funds of less than $100 (or $50 for Medicaid residents) the same day of the request and three banking days for amounts of $100 (or $50 for Medicaid residents) or more.

If the resident’s money is in excess of $100 (or $50 for Medicaid residents), the nursing home must place this in an interest-bearing account and provide separate accounting of these funds. The interest must be appropriately divided among the accounts and provided at least a quarterly statement. If the money is in a pooled account (such as all resident’s funds are deposited into one account), there must be a system for providing individual accounting records.

If the bank charges a fee for handling funds, the nursing home may pass this fee along to the resident(s). However, the nursing home cannot charge a fee to handle the resident’s money.

This regulation is not frequently cited, but when it is, the noncompliance generally relates to the resident not having access to their funds as outlined and/or the nursing home not providing statements for the resident’s account including what transactions occurred and if interest is added to the account, the amount of interest accrued. While the regulation requires that this is completed on a quarterly basis, you may provide a statement of accounting more frequently if desired.

Illinois Nursing Home Survey Trend Update

According to the Centers for Medicare & Medicaid Services (CMS) Quality, Certification, & Oversight Reports (QCOR) website, the top five deficiencies cited for the calendar year (CY) 2025 to date include:

F689 which is cited for accidents, hazards and supervision. This regulation could include several webinars on various topics, but let’s look at a couple of the most common causes and members are encouraged to use this as a reminder to monitor your procedures and practices to reduce your chance of receiving a deficiency.

Falls – when a resident is admitted and periodically thereafter you need to determine if the resident is at risk for falls. There isn’t a standardized tool that is required by CMS, so each nursing home may identify in their policy and procedure what tool they will utilize and the frequency of reassessment. When a resident is at risk of falls, preventative measures to reduce this risk (and/or associated injury) shall be implemented. Additionally, staff must ensure that they are following the care planned interventions to prevent falls.

When a resident sustains a fall, the nursing home must have a process for investigating the possible root cause of the fall and based on the root cause, implementing new interventions to prevent similar falls which are then included in the care plan.

Elopements – upon admission, nursing home staff must assess the resident’s risk for elopement. If the resident is at risk for elopement, preventative measures to reduce this risk must be implemented (such as a wandering alert device) or placement in a secured unit.

Any measure that is implemented to reduce wandering or elopement risk should be monitored for appropriate functioning as determined appropriate by the nursing home. This could include sounding the door alarms to ensure they are on and functioning or monitoring individual resident bracelets or necklaces for expiration date and functionality. Procedures to ensure devices function appropriately should be documented on some type of a log or in the individual resident’s MAR/TAR.

Response to the activation of an alarm which notifies staff that a resident has left the building should be monitored also. Frequently, staff respond to the door alarm but don’t thoroughly check the area to ensure that a resident is not already outside the building. It is best practice if a resident is not quickly identified as sounding the alarm, to complete a resident count to ensure that no residents leave the building. This may be included as an ongoing drill that your community completes to ensure that staff are aware of the appropriate response and if a resident is missing, how a search should be conducted.

There are additional measures that nursing homes may want to incorporate as well such as taking pictures of residents and including them in their medical records if the resident is missing the picture can be used to share with police or search parties. You may also develop search coordinates focusing on the property first and then expanding your search into grids surrounding the nursing home property.

F600 is the second most cited deficiency thus far in 2025. F600 is the regulation that prohibits resident abuse and neglect. This deficiency is cited when nursing home residents are abused, whether by a staff member or another resident. Additionally, F609 is another abuse regulation that is included in the top 10. F609 relates specifically to reporting incidents of abuse or suspicion of a crime. F609 directs nursing home staff to report abuse within two hours of the abuse occurring if there is serious physical injury or the potential for serious physical injury or within 24 hours if there is no physical injury or potential (such as misappropriation of resident property).

F880 is the third most cited deficiency on the list and relates to infection prevention and control programs. Like F689, F880 can be cited for a multitude of factors. Let’s focus on two right now including:

Enhanced barrier precautions (EBP) have been implemented in nursing homes since 2024. EBP requires that the nursing home identifies individuals who may be at risk for having or encountering a multi-drug-resistant organism (MDRO). Staff must use additional PPE (outside of standard/universal precautions) for individuals who have a colonized MDRO, have an indwelling device such as a foley catheter, feeding tube, intravenous line, etc; or have a chronic wound such as a pressure ulcer.

CMS states that nursing homes must identify a method for notifying staff that a resident is in EBP such as a certain sticker on their name plate. Additionally, PPE is not required to be placed immediately outside of the resident’s room as you would in transmission-based precautions (TBP) but needs to be readily available. This could include being in a resident’s bathroom, or a nearby storage closet. When staff are performing high-contact care (such as providing wound care, assisting with personal hygiene, or toileting), they will use additional PPE such as a gown, gloves, and possibly a mask/face shield based on the need. EBP is not meant to be used in the hallway or in a common area and does not restrict the residents to their room as TBP would.

F880 is commonly cited for EBP when staff do not use the additional PPE when performing high-contact cares for a resident that meets criteria for EBP.

Hand hygiene is another commonly cited concern under F880. Hand hygiene must be performed prior to applying gloves, when changing gloves, and when removing gloves. Additionally, staff should have alcohol-based hand rub (ABHR) readily available to complete between residents (for example if a staff member is assisting a resident with eating and then begins assisting a different resident, they should complete hand hygiene between the two residents).

Fourth on the list is F684 which is a general quality of care regulation. While I don’t have specific deficiency examples in Illinois, from my experience this is most cited for not completing an assessment when necessary or intervening based on the assessment findings. For example, a resident has a change in cognition and requires additional support while staff are transferring them. The nurse aides report this to the nurse who should complete an assessment such as vital signs, and a physical assessment to attempt to identify a potential cause or determine additional areas the resident may be displaying a change from their baseline. During this assessment, the nurse identifies that the resident has a low-grade fever and a low oxygen saturation level. Based on their standing orders, they apply oxygen via nasal canula and should report these findings to the resident’s physician. If any of these steps are missed, this can result in a deficiency under this regulation.

Finally, rounding out the top five, F677 is cited when activities of daily living (ADLs) are not completed as outlined in the resident’s care plan. This can include all ADLs such as bathing, oral care, personal hygiene, grooming, nail care, toileting/incontinence care, and shaving. Surveyors may identify this as a concern during their general observations of the resident (they possibly have a disheveled appearance or long facial hair) or residents/responsible parties may report concerns when they are being interviewed about the lack of care they are receiving. Additionally, if you notice that the resident is routinely refusing specific ADLs, you should try to identify why and implement any interventions that may assist with the resident allowing the ADLs (such as changing the days of the week or the time to better accommodate their desires). If there is a behavioral reason behind the refusal, the care plan should address individual behaviors and interventions that the staff can take to attempt to get the resident to comply such as a different staff member offering the service, offering at a later time, or perhaps a bath instead of a shower, etc.

There are several critical element pathways that surveyors use to assess compliance available in this Nursing Home Surveyor Resources One-Pager. These are great tools for nursing home staff to utilize as part of your quality assurance process!

LeadingAge Illinois is building out their clinical resource offerings on the website. If there are additional resources that you would like but cannot find, please email Kellie Van Ree, Director of Clinical Services

CMS Releases New Technical Details on HOPE

The Centers for Medicare & Medicaid Services (CMS) posted a presentation to their website providing additional details to hospice providers and technology vendors on the implementation of the Hospice Outcomes and Patient Evaluation Tool (HOPE). Of note, CMS called out a new Errata V1.00.2, available in the downloads section for the final HOPE data submission specifications (V1.00.1) which vendors will need to update their current systems to align with recent changes to the manual. The slide deck provides timeline updates for the transition to iQIES and the anticipated availability of the VUT. It also includes iQIES training tutorials to prepare hospices for the implementation of HOPE.

HUD Announces HOTMA Delay to 2026 for Multifamily Housing

On May 29, the Department of Housing and Urban Development (HUD) officially delayed the Multifamily Housing compliance date for the Housing Opportunity Through Modernization Act (HOTMA) until January 1, 2026. HUD’s Notice H-2025-03, officially delays the HOTMA compliance date by six months. The agency had previously extended the deadline to July 1, 2025, but HUD has not finalized the systems, forms, or materials needed for housing providers to move forward with HOTMA implementation. According to the new Notice, HUD-assisted Multifamily Housing owners are required to be in full compliance with the HOTMA final rule and HUD’s updated income and asset documentation requirements for income certifications having an effective date on or after January 1, 2026.

HOTMA was enacted by Congress in 2016 as a streamlining measure for HUD-assisted housing programs. The new rules change key elements of federal rental assistance, including how rent is calculated for assisted households and who is considered eligible for housing assistance. HOTMA also adjusts the recertification process that properties conduct.

CMS Announces New Home Health and Hospice RAC Contract

The Centers for Medicare & Medicaid Services (CMS) awarded Cotiviti GOV Services, LLC, the Recovery Audit Contract (RAC) Region 5 contract in addition to contracts for two other Medicare Part A and B RAC contracts. CMS’ previous contractor for home health and hospice, Performant, will remain under contract to support the RAC program from an administrative and appeals perspective for home and hospices, while Cotiviti GOV Services, LLC will begin reviews in the Summer of 2025.

RAC Region 5 providers can rely on the review completion date specified in the review results letter, as well as the RAC’s name on the letter, to identify which contractor to reach for inquiries. If Performant receives inquiries regarding reviews conducted by Cotiviti GOV Services LLC, Performant customer service will inform providers to reach out to Cotiviti GOV Services LLC and vice versa. The last approved issue for Performant’s home health and hospice RAC audit contract was a December 2023 Hospice Care- Extended Length of Stay audit.

Home Health & Hospice Star Trend Reports Now Available

Home health and hospice providers are now able to access provider level quality reports on the LeadingAge website by logging in here. These reports are updated quarterly as outlined in the table below. Any questions on your reports, please contact Katy Barnett at LeadingAge.

FY	Home Health Reports	Hospice Reports
Q1	October	November
Q2	January	February
Q3	April	May
Q4	July	August

Ask the Expert

A number of member questions come in daily to the association. In this article we will feature unique or recent questions of interest to members.

Q: I need help with identifying what CMS is wanting us to do when they want us to incorporate health equity in our QAPI process.

A: LeadingAge Illinois developed this one-pager resource on health equity with strategies that you can include in your QAPI process to maintain compliance. You can use data that you collect (such as falls, elopements, medication errors, etc) and track based on potential health inequities. This could include adding elements of tracking a resident’s race to identify if non-Caucasian residents have more falls than Caucasian residents.

Have a question? Email yours now.