The Centers for Medicare & Medicaid Services (“CMS”) has given surveyors additional rules and updates to allow surveyors to assess and cite violations of the regulations on nursing homes with admission agreements that create prohibited third-party guarantee of resident payments.

On November 18, 2024, the Quality, Safety & Oversight Group at CMS issued a memorandum entitled “REVISED: Revised Long-Term Care (LTC) Surveyor Guidance: Significant revisions to enhance quality and oversight of the LTC survey process” (“New Surveyor Guidance Memo”).

The New Surveyor Guidance Memo consolidates existing F-Tags, enhances surveyor oversight and details when a responsible person can be held personally liable if the responsible person fails to perform the promised actions and obligations in the admission agreement.

On March 7, 2025, CMS posted a memo dated March 10, 2025, that gives nursing homes and surveyors more time to prepare for the implementation of new rules and updates to allow surveyors to add extra attention and increase oversight in nursing homes. The New Surveyor Guidance Memo was revised to move the implementation date from March 24, 2025, to April 28, 2025. At that time, CMS also noted that revised surveyor resources will be released on April 28, 2025.

483.15(a)(3) – Third Party Guarantee of Payment

Under 42 CFR §483.15(a)(3), a nursing home must not request or require a third-party guarantee of payment to the nursing home as a condition of admission, expedited admission or continued stay in the nursing home. However, the nursing home may request and require a resident representative who has legal access to a resident’s income or resources available to pay for nursing home care to sign a contract, without incurring personal financial liability, to provide nursing home payment from the resident’s income or resources.

F-Tag 620 – Admission Agreements and Liability for Responsible Parties

The New Surveyor Guidance Memo adds that if an individual does not actually have legal access to the resident’s funds, the nursing home may not request or require the individual to pay the nursing home.

Thus, language that specifically requests a third party to personally guarantee payment to a nursing home is noncompliant. Also, language can be noncompliant even if it does not specifically reference a “guarantee” by a third party. Any language contained in an agreement that seeks to hold a third party personally responsible for paying the nursing home would violate this requirement.

The New Surveyor Guidance Memo also includes examples of noncompliant admission agreement language, including but not limited to:

  • Language that holds both (1) the resident and (2) the representative or other individual jointly responsible for any sums due to the nursing home (however, language that holds the resident solely responsible without joining the representative is allowable).
  • Language that holds the representative or other third-party individual personally liable for breach of an obligation in the agreement, such as (1) failing to apply for Medicaid in a timely and complete manner; or (2) allowing someone other than a signatory to the agreement to spend the resident’s resources that would be used to pay the nursing home.
  • Language that does not specifically mention a third-party guarantee but that implies the resident could be discharged if the representative does not voluntarily agree to personally pay to prevent the discharge.
  • Language that holds the representative or other individual personally liable for any amounts not paid to the nursing home in a timely manner because the representative or other individual did not provide accurate financial information or notify the nursing home of changes in the resident’s financial information.

The New Surveyor Guidance declares that admission agreements containing language like the examples above, or containing other language that confers personal liability upon a third party, represent noncompliance with this provision. Such language is noncompliant if it appears in the main document that a nursing home uses as its admission agreement or in other documents that are signed at admission. In addition, after a resident is admitted, the nursing home cannot use such language in agreements regarding a resident’s continued stay in the nursing home.

Effective Date

The New Surveyor Guidance is effective as of March 24, 2025.

Practical Takeaways

With these changes, the recommended actions include:

  • Admission Agreement Review and Revision: Update provisions in admission agreements that are noncompliant.

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