Many of the nation’s nursing homes deliver quality care to people who desperately need it. Still, some deliver care more capably than others. How do consumers evaluate the promises that nursing homes make to provide excellent care to their loved ones?

With the best of intentions, the federal government instituted a rating system to help consumers make informed decisions. The ratings are determined by the U.S. Centers for Medicare & Medicaid Services (CMS). A “care compare” website allows consumers to search for ratings by zip code or by a facility’s name.

The CMS awards one to five stars to nursing homes (and certain other healthcare providers) that are certified to accept Medicare. If the system works, family members should feel comfortable choosing a four-star or five-star nursing home and should be wary of choosing one that earned only a single star.

How Is the Star Rating Determined?

According to CMS, nursing homes with five stars are considered to deliver care that is well above average quality while nursing homes with one star are well below average. In addition to an overall rating, CMS awards stars in each of three categories:

• Health inspection ratings are based on the three most recent health inspections, with greater weight assigned to the most recent.
• Staffing ratings are based on the number of hours of care provided to each resident. The rating considers whether more hours of care are devoted to residents who need them.
• Clinical quality ratings are based on 15 criteria, including health outcomes, patient safety, and adherence to clinical guidelines.

Star ratings influence consumers. Nursing homes with the highest ratings therefore tend to have the highest profits. Nursing homes with the lowest ratings tend to be unprofitable. Since consumers base choices on star ratings, nursing homes have an incentive to achieve high ratings. Ideally, they do so by striving to provide a high quality of care.

Star Rating Criticism

The star ratings have been criticized almost from their inception. Some critics focus on the criteria that the ratings measure. For example, patient safety focuses on the prevention of harm by evaluating the number of patients that fall and the steps that nursing homes take to prevent falls. That’s important, but so are other means of keeping patients safe, such as “improving or maintaining functional status, treating pain, maintaining weight, avoiding incontinence and catheter use, avoiding depression, avoiding physical restraints and the inappropriate use of antipsychotic medications, and improving vaccination rates.”

Perhaps the most significant criticism of the rating system involves its reliance on self-reporting. Some nursing homes have been accused of gaming the ratings by, for example, inflating their reports of staffing levels and information about patient health.

A California study determined that some nursing homes were able to achieve 5-star ratings without providing 5-star service. Fortunately, the study determined that at least 6% of California nursing homes were actively inflating their ratings.

In response to those critics, CMS claims that it no longer relies on a nursing home’s unsupported assurance that it maintains a reported staffing level. Nursing homes must now provide payroll journals to prove that their reports are accurate. When records show that a nursing home failed to have a registered nurse on-site for four days in quarterly reporting period, CMS assigns the nursing home an automatic one-star rating in the staffing level category.

Yet payroll records may show only that a staff member was paid, not that a staff member was working. Staff members who are using sick leave or taking a vacation may still be drawing wages. The question is whether those staffers have been replaced while they are away from work. Payroll records alone do not easily answer that question.

The American Health Care Association contends that the CMS has not gone far enough. While registered nurses are an important component of patient care, other staff members assure that patients in need of assistance are not ignored. The AHCA also notes that the “staffing rating still does not include therapists, who play an important role in ensuring quality care.”

Improvements Still Needed

In an attempt to evaluate the CMS rating system, the New York Times analyzed “payroll records to determine how much hands-on care nursing homes provide residents, combed through 373,000 reports by state inspectors and examined financial statements submitted to the government by more than 10,000 nursing homes.” The Times concluded that the star ratings may be inaccurate for several reasons, including:

• The inclusion of vacationing employees and others who are not working to overstate staffing levels.
• The undercounting of residents’ falls and other accidents.
• The failure to manage bedsores and other serious health problems does not necessarily affect star ratings.
• Instances of abuse and neglect do not necessarily affect star ratings.
• Some nursing homes understate their administration of antipsychotic medications, creating the risk that the facilities are overmedicating patients to reduce the need for staff contact.
• Some nursing homes know in advance when “surprise” inspections will be performed, allowing them to increase their staff on the day that an inspector arrives.

Despite CMS reforms, the Times notes that 5-star nursing homes are as likely to flunk in-person inspections as to pass them. When inspectors do discover problems, they typically fail to conduct a more extensive investigation to discover whether the problems are widespread.

Charlene Harrington, who sits on a board that advises CMS on the ratings system, told the Times that nursing homes were unprepared for the pandemic in part because they focused on improving their star rating rather than improving the quality of their care. Nursing homes that underreported working staff members were caught short when staff members had to quarantine because they were exposed to the virus.

To be fair, the pandemic challenged all healthcare institutions. Keeping staff and patients safe from a rapidly spreading contagious disease is a daunting task. It is nevertheless fair to assume that some nursing homes were less equipped to meet the challenge because they failed to have sufficient staff on hand even before the pandemic arrived.

Assuring the reliability of 5-star ratings may require audits of the information upon which the rating is based. Yet “25 former government officials, congressional aides, nursing home executives and elder-care advocates” who meet with CMS officials told the Times that audits are rare. Insufficient funding for audits, which are primarily carried out by state government, contributes to consumer uncertainty that ratings can be trusted.