• Nursing homes pay penalties when they fail health and safety inspections. Those funds are pooled to improve care
• The fund has doubled since 2017 — to more than $35 million
• But with grants limited to just $6,000 a year, some argue the paperwork isn’t worth the time

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Michigan is sitting on $35.4 million designed to improve quality of life in state nursing homes even as poor conditions persist in some facilities.

The Civil Money Penalty Reinvestment Program has nearly doubled in seven years — growing from just more than $17 million by the end of 2017.

It’s so big — and the federal red tape so tight — that the fund appears poised to simply grow virtually unspent.

“It grows because we’re not using it as we should,” said Melissa Samuel, of the Health Care Association of Michigan, which represents many of the state’s nursing homes and assisted living facilities.

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• Michigan cities balk at costly 911 calls to understaffed nursing homes

In a rare triangulation of agreement, nursing homes, state officials and even consumer agreements lay the blame in the same place: federal regulations.

“We don’t have a lot of wiggle room,” said Scott Wamsley, director of the state’s Bureau of Aging, Community Living and Supports. 

Penalties outpace spending

As in other states, Michigan’s nursing homes pay fines for violating dozens of federal health and safety standards — from failing to file proper paperwork or not having enough staff to deadly accidents and medication errors. 

Those fines, paid to the US Centers for Medicare and Medicaid Services, and then returned, at least in part, to the states, make up the Civil Money Penalty Reinvestment Program.

Nursing homes can then apply to the pool of funds to pay for programs that improve care — but, notably not by replacing dollars nursing homes already are supposed to spend on care.

The fund had covered costs for a variety of efforts since 2016, according to federal documents, including staff training, arts projects, training staff and buying equipment during the pandemic. 

Yet even with those grants, the fund had continued to grow over the years as penalty payments outpaced nursing homes’ requests for grants, and COVID, at least for a time, paused the usual grant process.

By 2023, the Michigan fund surpassed $22.6 million.

That year, the Biden administration severely restricted the use of the funds across the US, citing “inconsistent availability and inequity to access.”

The new rules capped grants at $5,000 per year, and limited what the money could be used for, prohibiting much sought-after technology-based projects, for example. 

The result: All 27 of Michigan’s grant applications — $8 million in all — were rescinded.

The fund continued to grow, reaching $29.4 million by the end of 2023, even as the state attempted, without success, to “get clarification” on the new rules. 

In 2024, several facilities worked together to pull down nearly $1.8 million in five grants, including two focused on combatting loneliness and improving quality of life for nursing home residents. Still, the fund approached $32.9 million by the end of last year.

‘Their own version of hell’

At the same time, countless Michigan nursing home residents have complained to state inspectors of boredom and loneliness, of being stuck in their rooms, languishing in their beds and parked in front of television sets. 

Activities even at one highly rated nursing home, are “uninspired and repetitive,” one inspector wrote, citing the facility for failing to offer activities that meet “the interest/needs of each Resident”.

Meanwhile, budget cuts shrink activities departments, even as research suggests that music can reduce stress, fight depression, calm the cardiovascular system and improve balance, according to one report by the Global Council on Brain Health and AARP.

Civil penalties paid for infractions could be reinvested in affordable programs like live music, a magician, or the care of a dog or cat — small expenditures that offer outsized opportunities to break up monotony, Lori Smetanka, executive director of the consumer nonprofit, National Consumer Voice, and others, told Bridge.

Deaths or abuse may snag headlines, but it’s this everyday misery inside the nation’s nursing homes that equally troubles her, Smetanka said.

Bingo is a tired go-to, she said — a game that many enjoy, but often the only option.

“For the people that like it, that’s fantastic,” she said. “For the people that don’t, they’re in their own version of hell.”

Not worth the time

Several nursing home administrators and advocates told Bridge that the possibility of such a small amount of money is not worth the hours required to fill out a grant application, answer follow-up questions from the state and the US Centers for Medicare & Medicaid Services (CMS), collect data and file review reports.

That includes administrators of even some of the best nursing homes, like Destiny Wilkins, who was leading a tour earlier this year of the Jackson County Medical Care Facility, a five-star rated facility.

Wilkins strolled through hallways brightened with natural light from large windows, resident’s artwork and pictures of their family members. Wilkins asked residents about their recent visitors and outings. Around her, staff seemed in perpetual motion, moving residents to therapy and other appointments and readying for afternoon activities.

An assistant handed her a phone message. Wilkins’ 1 o’clock appointment was waiting, too.

And the possibility of a few thousand dollars in civil monetary funds?

“As it stands right now, we don’t have the bandwidth to do all of the grant work that comes with it,” she said.

Wilkins’ sentiments echoed those of LeadingAge, an industry group that had asked the Trump administration, in a May 8 letter, to relax the rules and give decision-making powers to the state.

Wamsley, at Michigan’s aging bureau, doesn’t fault the nursing homes for not asking to spend the money. Nor can the state, he said, do much to release the money to them, he said.

Even if every nursing home were to ask — and receive — money for a project each year, the fund would likely continue to grow as penalties outpace spending, Wamsley said.

The grant caps on Sept. 29 increased to $6,000. 

Even then, he said, those grants “wouldn’t put a dent in the amount that’s available.”

Bridge Michigan’s questions to CMS about the Michigan fund and its growth, the restriction on the dollars, and details about funds in other states, were not answered.

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