The Office of Management and Budget (OMB) is reviewing “Cutting Administrative Requirements for Excellence in Patient Care” (CMS-3484), the proposed rule that could produce a slew of proposals to change regulations for the nursing home sector and a wider set of providers and suppliers in the Medicare and Medicaid universe.

Expectations are for an August announcement on the proposed rule.

In the notice on the OMB site announcing the review, the proposal is described as follows:

This proposed rule would enhance direct patient care by modernizing the Conditions of Participation, Conditions for Coverage, and Requirements for Medicare- and Medicaid-participating providers and suppliers, reducing burden and increasing flexibility to deliver high quality care. CMS identified obsolete, outdated, and excessively burdensome regulations that can be eliminated or reformed to enhance the effectiveness of facility operations and services and free up resources that health care providers could otherwise use to improve patient health and safety.

Ahead of whatever emerges from the proposal, a leading provider said the refocusing of the rules and regulations to how they affect patients and residents is vital.

"Healthcare regulations should be measured by whether they improve patient care and outcomes,” said Neil L. Pruitt, Jr., chairman and CEO of PruittHealth.

“Administrative requirements have grown significantly, consuming resources that could otherwise be directed toward caregivers and patients. We welcome efforts to streamline outdated or duplicative processes while maintaining high standards of quality and accountability. The best policy changes are those that allow providers to devote more time, talent, and resources to caring for those we serve."

A Theme

Policy changes to reduce regulations are a priority issue for the Trump Administration, which has prided itself on a mantra of eliminating 10 regulations for every new one. The OMB review also follows the issuance of a RFI Medicare Regulatory Relief Request for Information | CMS from the Centers for Medicare and Medicaid Services (CMS) in 2025 seeking input on regulations that stakeholders want to see eliminated or altered.

During the RFI process and in the course of regular discussion within the sector, a number of regulatory trouble-spots have emerged that providers and their advocates would like CMS to act on. These range from cutting the Payroll Based Journal (PBJ) automatic one-star penalty for missed deadlines to increasing the percentage of facilities that can receive a Five-Star designation to ending respiratory reporting tied to the pandemic that is no more.

One industry source who asked to remain anonymous said there is also a paradox in play with the SNF sector primed for an announcement on deregulation at the same time CMS for “many, many years promoting an uptick in enforcement severity on the reimbursement side. It is a mixed message.”

The Laundry List

That being said, we asked regulatory experts to offer their take on what exactly CMS may propose in its rulemaking, and what it means to owners and operators.

Steven Littlehale, chief innovation officer, Zimmet Healthcare Services Group, produced a laundry list for consideration, detailing what could be a major change from the current regulatory structure.

“For nursing home owner/operators, the broader strategic implication is that CMS appears to be signaling a shift from ‘more rules’ to ‘smarter rules.’ If implemented as described, this could reduce compliance costs and administrative workload while maintaining core expectations around resident safety and quality. The exact provisions will depend on the final rule language when it is released in August,” he said.

Here is what Littlehale says could be in store:

1. Documentation requirements may become less prescriptive

Owners should watch for changes to:

- Conditions of Participation

- Required policies and procedures

- Documentation expectations

- Administrative records

“Reducing unnecessary documentation can have a meaningful impact on labor costs and increase time available at the bedside,” Littlehale said.

2. Survey process changes may continue

CMS has already shown willingness to adjust oversight, including:

- Moving to a two-survey health inspection cycle

- Delaying (not removing) new ownership reporting requirements

- Rescinding the federal staffing mandate's minimum hourly requirements (this may shift at midterms)

“Those actions suggest additional survey and compliance reforms may follow. They have also piloted risk-based surveys, again demonstrating willingness to reduce oversight as data suggests,” he said.

3. Duplicative reporting could shrink

One of the recurring themes from providers was eliminating situations where essentially the same information must be submitted multiple times through different CMS systems.

Examples discussed during the RFI process included:

- Overlapping quality reporting (for example, there are several measures for hospital utilization, and they are all slightly different)

- Duplicative compliance documentation

- Redundant Medicare reporting requirement

4. More operational flexibility

Littlehale said operators should look for greater discretion in how they achieve compliance rather than prescriptive "check-the-box" requirements. “This means CMS might just check to see if you achieved the outcome, rather than each step that they deem necessary,” he said.

That could affect:

- Infection prevention processes

- Quality assurance documentation

- Operational workflows

- Clinical policies

The emphasis appears to be on outcomes rather than rigid processes,” Littlehale said.

5. Cost savings may be meaningful

For many operators, regulatory compliance requires:

- Compliance staff

- Consultants

- Nursing management time

- Documentation support

- Survey preparation

Even modest reductions in administrative burden could translate into meaningful labor savings without affecting reimbursement, he said.

What Has Not Changed

Despite the deregulatory direction, Littlehale said owners should not assume that core compliance expectations are going away.

CMS has not indicated plans to eliminate or substantially weaken:

- Five-Star Quality Rating System

- PBJ staffing reporting

- MDS reporting

- SNF Quality Reporting Program (QRP)

- SNF Value-Based Purchasing (VBP)

- Survey enforcement authority

- Fraud and abuse oversight

“The focus is on reducing unnecessary administrative burden, not abandoning quality measurement or accountability. The piloted risk-based surveys are a great example of this,” Littlehale said.

Keep Watch

He said based on the RFI submissions and CMS's public comments stakeholders should watch for movement in these areas over the next six months to a year:

- Simplification of Conditions of Participation

- Reduced documentation requirements

- Streamlined survey and certification processes

- Elimination of duplicative Medicare reporting

- Greater flexibility in compliance pathways

- Revisions to outdated regulations that no longer reflect modern post-acute care.

Comments or questions on this article? Contact Patrick Connole at pconnole@parkplacelive.com.