Common practices that can put you in jeopardy.

NURSING HOME PROVIDERS FREQUENTLY BEMOAN THEIR POOR public image. In doing so, they usually blame others for the industry's bad reputation, contending that the public just can't cope with the aging process, or that I government agencies and personal injury attorneys have poisoned the atmosphere by harping on facility errors.

Although these points may be valid to some extent, providers should also take a good look in the mirror. Many facilities maintain standard operating procedures that directly contradict federal law. These procedures are revealed in the following statements that facilities routinely make to residents and family members:

* "You have to wake up at 6 a.m. because we don't have enough nurse aides to accommodate individual schedules." "The assembly-line nature of many nursing facilities can be devastating to the emotional health of some residents. Imagine the effect on even a healthy person who is suddenly required to wake up at 6 a.m. and go to bed at 7:30 p.m., in accordance with a regimented facility-wide schedule.

The federal Nursing Home Reform Law states that a provider must care for its residents "in such a manner and in such an environment as will promote maintenance or enhancement of the quality of life of each resident." More specifically, residents have the right "to reside and receive services with reasonable accommodation of individual needs and preferences, except where the health or safety of the individual or other residents would be endangered." A corresponding regulation explicitly addresses daily schedules, stating that a "resident has the right to choose activities, schedules, and health care consistent with his or her interests, assessments, and plans of care."

* "We can't give you therapy services because Medicaid doesn't pay for the therapy." Some facilities continually try to limit Medicaid recipients to the bare necessities. The discrimination against Medicaid recipients is particularly evident when a resident transitions from Medicare. Although the resident may have received daily physical therapy under Medicare, it is relatively common (although generally illegal) for a facility to eliminate such services when the resident goes on Medicaid.

Federal law requires that a nursing facility provide "services and activities to attain or maintain the highest practicable physical, mental, and psychosocial well-being of each resident." What's more, a facility must not discriminate in the provision of services based on the reimbursement source. In fact, the surveyor's guidelines explicitly state that:

(1) Specialized rehabilitative services are considered a facility service and are, thus, included within the scope of facility services.

(2) Such services must be provided to residents who need them even if the services are not specifically enumerated in a state's [Medicaid] plan.

(3) Because such services are covered facility services, no fee can be charged to a Medicaid recipient.

* "You can't receive Medicare reimbursement because we have determined that your level of care doesn't meet Medicare standards." Under Medicare law, the nursing facility generally makes the initial determination as to whether to bill HCFA for a resident's care. The law also requires that the form on which a resident is notified of this determination must also inform the resident that he or she may insist that the facility submit a bill to the Medicare program anyway. The coverage decision is ultimately made by HCFA (subject, of course, to further appeals). In addition, if a bill is submitted, the nursing facility must wait until Medicare denies the claim before billing the resident directly.

* "Because you are not eligible for Medicare reimbursement, you must leave your Medicare-certified bed." Because Medicare will pay for only 100 days of nursing care per benefit period, a facility has strong financial incentives to shuttle residents in and out of Medicare-certified beds. Although this shuffling optimizes a facility's reimbursement, it comes at the expense of residents, who may experience transfer trauma.

Congress recognized the incentive for shuttling residents to and from Medicare-certified beds and, accordingly, gave residents the right to veto intra-facility transfers motivated by a change in reimbursement. Specifically, a resident has the "right to refuse a transfer to another room within the facility, if a purpose of the transfer is to relocate the resident from a portion of the facility that is [Medicare certified] to a portion of the facility that is not [Medicare certified]."

Facility staffs often argue that the Medicare rules require Medicare-certified beds be occupied by only Medicare-eligible residents. This argument is bogus. Medicare certification does not prevent a room from being used for the care of a resident who pays privately or, if the room is dually certified for Medicare and Medicaid, a resident who pays through the Medicaid program.

* "We can't admit your parent unless you accept full financial responsibility." The Nursing Home Reform Law prohibits federally certified nursing facilities from requiring a third-party guarantee of payment as a condition of admission or continued stay, regardless of the resident's payment source. To get around this law--and deceive the general public--some facilities will request that a family member or friend sign an admission agreement as a "responsible party." The family member or friend generally signs the agreement, usually in the mistaken belief that "responsible party" means "contact person in case of an emergency." In fact, buried in the admission agreement somewhere is a definition of "responsible party" as one who understands that he or she cannot be required to become financially liable, but nevertheless "volunteers" to assume full financial responsibility for the resident's nursing facility expenses.

Such provisions are illegal and unenforceable for three reasons. First, when used to require a third-party guarantee of payment, they are in clear violation of federal law. Second, they provide no benefit to a resident, family member, or friend, and are thus unenforceable under standard contract law. Third, they are deceptive and unenforceable under state consumer protection statutes. This analysis was followed in the case of Podolsky v. First Healthcare Corp., in which the California Court of Appeal rejected an attempt by the Hillhaven chain of nursing facilities to solicit third-party guarantees.

* "We don't have to readmit you from the hospital because your bed hold period has expired. "The Nursing Home Reform Law provides that a Medicaid-eligible resident may return to an available bed in a nursing facility after a hospital stay of any length. This provision strikes a balance between the resident's interests and the interests of the nursing facility. On one hand, Medicaid-eligible residents often have difficulty finding a nursing facility placement because Medicaid generally pays a relatively low reimbursement rate. On the other hand, nursing facilities cannot be expected to hold beds vacant indefinitely for a hospitalized resident.

Making misstatements that rely on residents' unfamiliarity with the law is a shortsighted strategy. Even though many residents and family members are easily deceived, by denying or evading the law you invite citations and lawsuits. Just as significantly, you poison the relationship with your customers, and perpetuate the poor public image of long term care providers.

Erie M. Carlson is director of the Nursing Home Advocacy Project of Bet Tzedek Legal Services in Los Angeles, and author of "Long-Term Care Advocacy" (Matthew Bender).