Nursing homes in some areas would be required to test staff and visitors for COVID-19 on a weekly basis under planned rules from the Trump administration. The testing requirement, announced July 22 as part of a set of initiatives aimed at further protecting nursing home residents from coronavirus, would apply to all nursing homes in states with a 5 percent or greater COVID-19 positivity rate.
The plan also includes $5 billion in funding to help combat the virus’ spread in nursing homes, which in the U.S. are related to 8 percent of COVID-19 cases and 42 percent of deaths from the virus.
The proposed testing mandate also accompanies a commitment from the U.S. Department of Health and Human Services, announced July 14, to distribute rapid point-of-care testing instruments to nursing homes in COVID-19 hotspots across the country. Although these tests provide results in minutes and avoid ongoing result delays, the rapid antigen tests reportedly provide false negatives for about 15 percent of patients infected with the virus.
“There is going to be a margin of error,” said Greg Wideman, Brokerage Manager, Healthcare, Burns & Wilcox, Chicago, Illinois. “If a facility gets a bad test or a bad batch of tests and someone with COVID-19 slips through the cracks as a result, the fact that the facility is testing does not exempt it from liability.
“There is going to be a margin of error. If a facility gets a bad test or a bad batch of tests and someone with COVID-19 slips through the cracks as a result, the fact that the facility is testing does not exempt it from liability.” –Greg Wideman, Burns & Wilcox
Though increased testing of staff and visitors may catch cases earlier, especially among those who are asymptomatic, nursing homes will continue to face coronavirus-related liability concerns at a time when they are already braced for lawsuits. Mitigating those legal costs with robust Professional Liability Insurance coverage is perhaps more critical now than ever before.
“There is no certainty, even with testing,” said Margaret Karnick, Senior Underwriter, Professional Liability, Burns & Wilcox, Chicago, Illinois. “It is good to test staff, but even if someone is negative for COVID-19 today, it does not mean that person could not be exposed to the virus the next day. Testing may perhaps generate a false sense of security. Preventative measures need to be strictly maintained.”
Funding comes as nursing homes struggle to contain virus, stay afloat
The new federal funding is planned to become part of the Provider Relief Fund authorized by the Coronavirus Aid, Relief, and Economic Security (CARES) Act and be made available to facilities that participate in Medicare and Medicaid. Intended to cover expenses like additional staff and enhanced infection control, it could prove to be a much-needed boost for nursing homes struggling to remain open as costs and lawsuits increase.
“There are small nursing homes that were barely scraping by before coronavirus that are definitely at risk of closing at this point. Many of these nursing homes provide a necessary service to the community. If the federal government puts $5 billion toward helping them, that would be lifesaving,” Karnick said. “No one could have predicted the amount of personal protective equipment these facilities would need. Changing facility operations to this extent, revamping guidelines—all of that comes with a price tag.”
Wideman affirmed that implementing a weekly testing protocol in addition to other precautions is a major undertaking. “Keeping up with expenses could prove especially problematic for nursing homes running on small margins,” he said.
COVID-19 cases are currently surging in nursing homes in some states, including Louisiana and Florida, some Tennessee nursing homes are re-entering “lockdown” as cases rise, and positive test results among Texas nursing home residents have jumped 60 percent since July 1.
In Michigan, where lawmakers are working on a bill to keep elderly patients with COVID-19 out of nursing homes and instead divert them to designated care facilities, one-third of the state’s COVID-19 fatalities — nearly 2,000 deaths — were related to nursing homes. While some states have offered immunity from liability to nursing homes, it is unclear how that will play out in court.
“When nursing home populations are isolated for extended periods of time there can be negative repercussions. The likelihood of pressure ulcers, slip-and-fall accidents and regression in condition can increase dramatically for some of these individuals.” —Margaret Karnick, Burns & Wilcox
“There may be potential immunity from liability for nursing home care providers, but until cases actually go to court, we will not know,” Karnick said.
With that in mind, nursing home operators should make certain they have adequate Professional Liability Insurance coverage at appropriate limits, she said.
Professional Liability Insurance is essential for all senior living facilities and can help with costs related to lawsuits alleging negligence, such as in cases involving medication errors, failure to properly diagnose and/or treat residents, failure to hire proper staff, and violating residents’ rights.
For nursing homes, adequate protection also typically includes the facility’s Commercial General Liability (CGL) Insurance policy, which would cover costs stemming from physical injuries sustained on its premises or property damage to the facility itself. With legal fees often reaching $100,000 to $200,000 or more for a single case, an insurance policy with limits that are too low could force facility owners to pay lawsuit settlement costs out of pocket.
“I think nursing homes understand that they will be seeing lawsuits soon,” Wideman noted. “If they do not have the money to defend or settle, it can be tough to move forward. Lawsuits can definitely cripple a business quickly.”
Lack of visitors and resident isolation complications add to risks
Under the Trump administration’s proposed new guidelines, which do not yet have a timeline for implementation, nursing home visits would be allowed to resume when facilities have been free from COVID-19 infection for two weeks. Visits were largely banned in March as the virus began to spread, causing concerns for patients accustomed to family members’ presence and involvement in their care. The benefits to patients of resuming face-to-face visits, even if they are moved outdoors or restricted in frequency, are being weighed against the health risks.
“When nursing home populations are isolated for extended periods of time there can be negative repercussions,” said Karnick. “The likelihood of pressure ulcers, slip-and-fall accidents and regression in condition can increase dramatically for some of these individuals.”
There is potential for a wave of lawsuits related to recent resident isolation and the limited-contact care nursing home staff have been asked to provide, including minimizing their interactions with residents. Of the 1.6 million nursing home residents in the U.S., about half fall each year and 1 in 3 fall two or more times per year. “Once a resident slips and falls, they may never recover or be the way they were prior to that fall. There can be cognitive deficits as well as physical,” Karnick explained.
Losses can be even greater when a fall occurs due to an employee being distracted, helping another patient, or not following proper protocols, Wideman added. In May 2019, a jury in Georgia awarded $1.8 million to the family of a 70-year-old nursing home patient who suffered brain damage and later died after an aide rolled her off her bed, causing her to fall and hit her head.
Barring family from visiting their loved ones could also lead to more lawsuits. “Not being able to visit your family member, knowing there are situations where COVID-19 could be running rampant and you may not hear about cases right away, takes an emotional toll,” Wideman said. “It is certainly possible that a family could seek retribution by suing a nursing home that bans in-person visits to reduce COVID-19 infection.”
Review insurance coverage, check for exclusions
From an insurance perspective, senior living facility owners have been regularly inquiring whether their existing Professional Liability Insurance coverage applies to expenses related to COVID-19, Wideman said. He noted that some carriers are adding communicable disease exclusions—or even COVID-19-specific exclusions—to policies at mid-term or renewal.
“Rather than seeing some of these nursing homes that are very much needed in their communities shut down, we have to help them figure out a way to stay in business and maintain appropriate coverage.” –Wideman
Nevertheless, it is still possible to obtain a Professional Liability Insurance policy without a communicable diseases exclusion. “Having the right broker who has the right contacts and knows the market is crucial,” said Karnick.
One of the often-overlooked benefits of Professional Liability Insurance for nursing homes is the risk management consultation service offered with many policies. “It is often free to use, and can help facilities set up policies and procedures,” Wideman said. “I recommend all facilities conduct a thorough review of their existing Professional Liability Insurance coverage and consult an insurance broker or agent about their ongoing coverage needs.”
As part of their coverage assessment, nursing home operators should inquire about evacuation expense and crisis management enhancements for Professional Liability Insurance policies. These add-ons can help with the cost of evacuating residents in the event of an outbreak and other emergency.
“Evacuation expense and crisis management are important, especially in this current environment,” Karnick explained. “As we saw when coronavirus began breaking out, some facilities were forced to evacuate residents and make public announcements.”
Despite feeling the financial strain, nursing homes should avoid scaling back insurance at a time when it is needed most, Wideman said. “Rather than seeing some of these nursing homes that are very much needed in their communities shut down, we have to help them figure out a way to stay in business and maintain appropriate coverage,” he said.
Karnick agreed: “There are facilities looking at lowering their coverage limits to cut costs, but that is not the right answer.”
Successes show effectiveness of protocols and procedures
While nursing homes have been hotspots for COVID-19 outbreaks in the U.S. as well as Canada, where 81 percent of coronavirus deaths are reportedly linked to long-term care facilities, some areas have seen success combating the spread of the virus.
“Many workers are working 12-hour shifts and facilities are short-staffed. Facilities need to provide training and reminders, and keep staff up to date when guidelines change.” –Karnick
Nursing home cases have dropped sharply in areas of Ohio and Massachusetts, and senior living facilities in Wisconsin have managed to limit their recent COVID-19 case surge to 5 percent even as cases spiked 32 percent statewide. “Nursing homes have learned many lessons in recent months,” Karnick said. “There are now policies and procedures, risk management protocols and response measures that can significantly reduce the spread of COVID-19 infection.”
Still, even if all guidelines are followed, COVID-19 infections could occur among patients or staff. “If that happens, your best defense is to have thorough written policies and procedures and point to the guidelines you have followed, beyond just the U.S. Centers for Disease Control and other public health guidelines, but your own facility’s infection prevention and response protocols,” she said.
Senior living facilities can mitigate their risks by closely following state and federal guidelines, keeping up with the latest testing recommendations, and updating their written policies and procedures as needed. Employee training is also critical, Karnick said. “Many workers are working 12-hour shifts and facilities are short-staffed. Facilities need to provide training and reminders, and keep staff up to date when guidelines change.”
