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Dr. Miyeon Song: Aging New Jersey: Long-Term Care Challenges and Quality Ratings in Nursing Homes

Miyeon Song, PhD
Dr. Miyeon Song, Assistant Professor, Rutgers SPAA

By Dr. Miyeon Song
(with Jinah Yoo, SPAA PhD Student, and Seungho An, PhD)
Research Funded by the New Jersey State Policy Lab

The Challenges in Long-Term Care Quality

New Jersey’s elderly population is on the rise. According to a report from the New Jersey Department of Human Services, individuals aged 60 and older made up 23.4% (2,078,439) of the total population in 2019, marking a 24.7% increase compared to the 2010 statistics. They estimate this number to reach almost 3 million by 2029. This demographic shift has prompted the New Jersey state government to establish a state division on aging (Chapter 72 of the Public Laws of 1957) and implement various programs to enhance the well-being of its elderly population, such as Jersey Assistance for Community Caregiving, Adult Day Health Services, and Managed Long-Term Services and Supports. Despite these efforts, the challenge of poor long-term care quality in nursing homes persists in the state.

In response to concerns regarding poor care in nursing homes, New Jersey recently took significant actions by revoking more than 40 nursing licenses (including temporary licenses) and shutting down several nursing homes, including the once largest nursing home in the state, Woodland Behavioral nursing home, all due to poor care. However, there are apprehensions about potential unintended consequences resulting from closing facilities, such as placing greater burdens on nearby facilities and leading to higher costs of nursing home care for residents due to the increased demand and reduced supply of long-term care in the state. As a result, numerous low-quality nursing homes in New Jersey, as evidenced by poor federal and state assessments, continue to remain operational. In particular, recent reports highlight that New Jersey Medicaid continues to fund subpar long-term care, allocating over $100 million to the worst nursing homes. With the elderly population and health expenditure in the state on the rise, it becomes increasingly vital to incentivize facilities to improve their quality.

Quality Reporting in Nursing Homes  

The issue of low-quality long-term care has been a long-standing concern, not only in New Jersey but also across the country. In an effort to enhance nursing home quality and resident well-being, the Centers for Medicare and Medicaid Services (CMS) has implemented a public reporting system called Nursing Home Compare (NHC) for all Medicare- and/or Medicaid-certified nursing homes nationwide. The NHC system has provided useful information about nursing home quality, including the five-star quality rating system. The rating system ranges from one star (much below average quality) to five stars (much above average quality) and is based on three performance dimensions – health deficiencies, staffing levels, and quality of care ratings.

While the NHC five-star quality ratings are designed to provide residents with information about facility quality and encourage nursing homes to improve care, little is known about how nursing homes in New Jersey respond to this reporting system. Therefore, the central purpose of this study is to shed light on this aspect and examine the dynamics between quality reporting and nursing home behavior in New Jersey. Understanding how nursing homes in New Jersey interact with the NHC system can offer valuable insights into the effectiveness of such public reporting initiatives and their impact on the quality of long-term care in the state.

New Jersey State Policy Lab Project

Our project offers rigorous empirical assessments of nursing home quality and thus has important policy implications for long-term care in New Jersey. First, we will illustrate how nursing homes in New Jersey have been performing compared to facilities in other states in the last decade and how they respond to government quality standards, particularly focusing on the role of the overall five-star quality rating. Subsequently, we will investigate whether nursing homes make an effort to improve quality after receiving lower quality ratings than other homes in the community or lower ratings than in previous years. Finally, we will explore whether facilities in underserved communities are more or less likely to take actions to improve quality in response to the quality rating information.

This project can contribute to a positive cycle of continuous improvement in long-term care. Specifically, the results of this investigation can inform policy strategies to ensure quality long-term care in New Jersey, including enhancing effective public reporting, designing effective enforcement mechanisms, and improving incentive structures using quality rating information. By doing so, this project can offer implications for recent nursing home reforms in the state (i.e., S2712 and S2785, signed by Governor Phil Murphy in 2020). Ultimately, the project can offer policy recommendations for the New Jersey Department of Health (NJDOH), which licenses and regulates all long-term facilities in New Jersey, to improve long-term care quality in the state.