CLEVELAND, Ohio — The federal government wants to reduce paperwork for nursing homes. The question is whether eliminating some of that paperwork could also make it harder to determine how public money is spent on caring for elderly and disabled residents.
A proposed rule published November 10 by the Centers for Medicare & Medicaid Services would eliminate requirements for states to disclose how much Medicaid funding nursing homes spend on direct-care workers and support staff.
The requirements were established in 2024 but are not scheduled to take effect until June 2028. The proposal would cancel them before reporting begins.
CMS says the changes would reduce unnecessary administrative expenses and allow healthcare providers to devote more resources to patient care.
But they also would eliminate a planned source of public information about the relationship between Medicaid payments and workforce spending.
What Would Nursing Homes No Longer Have to Report?
Under the existing regulations, states would eventually be required to disclose, facility by facility, the percentage of Medicaid nursing home payments spent compensating direct-care employees, including nursing and therapy personnel.
Separate disclosures would cover support workers, including housekeeping, food service and transportation employees.
The proposal would eliminate both nursing home measures. It would also remove support-staff reporting for intermediate care facilities serving people with intellectual disabilities, while retaining those facilities’ direct-care compensation reporting.
The distinction matters because Medicaid is a major source of nursing home financing.
According to CMS, Medicaid spent approximately $68.8 billion on nursing facility services in 2023, serving roughly 1.29 million beneficiaries.
The proposed reporting system was intended to help policymakers and the public understand how that money supports the people delivering care.
How Much Would Eliminating the Requirements Save?
CMS estimates that withdrawing the three reporting requirements would avoid approximately $304 million in provider compliance costs over 10 years, along with more than 3.3 million hours of administrative work.
Those are projected savings from requirements that have not yet taken effect, not money already saved or independently demonstrated improvements in care.
Nursing homes typically receive payments from Medicaid, Medicare, private insurers and residents paying out of pocket.
Determining precisely which employee hours should be attributed to Medicaid patients can be complicated.
CMS argues that collecting the information could require extensive employee time tracking, potentially diverting staff attention from residents.
The agency is exploring whether existing payroll, census and financial records could provide useful estimates without imposing additional reporting responsibilities.
Providers Support Relief, but Transparency Remains an Issue
The nursing home industry has welcomed portions of the proposal.
Clif Porter, president and CEO of the American Health Care Association and National Center for Assisted Living, supported reductions in outdated reporting requirements in comments reported by Skilled Nursing News.
LeadingAge, which represents nonprofit aging-services providers, raised a more complicated concern.
Jodi Eyigor, the organization’s vice president of health policy, said measuring only the percentage of Medicaid funds spent on employee compensation can overlook legitimate expenses such as facility improvements and resident safety.
But she also emphasized the importance of identifying financial arrangements that redirect resources away from resident care and toward owners or affiliated businesses.
The debate is not simply whether nursing homes should complete more reports. It is whether the information collected is accurate, meaningful and worth the cost of producing it.
What Could Residents and Families Lose?
For residents and their families, the central concern is the relationship between funding, staffing and quality of care.
When facilities struggle to recruit and retain workers, residents may experience longer waits for assistance with bathing, dressing, meals and other essential services.
Workers also have an interest in understanding whether public reimbursement supports compensation and workforce stability.
A recent federal Inspector General review examined four states with nursing home minimum-spending requirements.
The review found that states used different financial measures and that three encountered implementation challenges, including difficulties obtaining reliable data.
Those findings demonstrate both the complexity of monitoring nursing home spending and the importance of developing workable reporting systems.
The National Academies of Sciences, Engineering, and Medicine has separately identified limited financial transparency and complicated ownership arrangements as obstacles to evaluating nursing home quality and the adequacy of public payments.
Existing federal nursing home staffing disclosures, including payroll-based staffing data and quality ratings, would remain available under this proposal.
However, those records do not provide the same facility-specific accounting of Medicaid dollars spent on worker compensation.
The Question Is Whether Efficiency Improves Care
For Ohio families choosing nursing homes, regulators overseeing facilities and taxpayers financing Medicaid, the debate raises several practical questions.
How much will eliminating the reporting requirements actually save individual facilities? Will those savings support additional staffing, better compensation or improved resident services? And can regulators still identify facilities where public funding is not translating into adequate care?
The proposal does not establish that reduced reporting expenses will produce better resident outcomes. Nor does it demonstrate that the original reporting requirements would have produced fully accurate comparisons among facilities.
Both claims require evidence.
CMS is accepting public comments through January 11, 2027, giving residents, workers, providers and advocates an opportunity to address those questions before a final decision.
Reducing unnecessary administrative costs is a legitimate government objective. So is ensuring that public resources support the services taxpayers are financing.
The challenge is finding a way to accomplish both.
Because in nursing home care, the measure of government efficiency should not be how much paperwork disappears. It should also be whether residents receive better care and the public can still follow the money.