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10 Min Read
February 16, 2024

How to Avoid PBJ Reporting Penalties in 2024

by Morris Isaacson

Payroll-based journal reporting is a requirement for long-term care and skilled nursing facilities under the Medicare or Medicaid programs. Simply put, PBJ reporting for nursing homes delivers staffing and turnover data to the Centers for Medicare & Medicaid Services (CMS). The CMS uses this information to calculate a performance score and shares those scores with the public.  


The goal is to help patients and families compare facilities and make informed decisions. It also uses public accountability to incentivize facilities to comply with staffing ratios and enact good care practices.  


Yet, there are other expensive penalties, too. Understanding the types of penalties you could face for non-compliance, the causes, and how to avoid them can save your reputation and bottom line.   

Types of PBJ reporting penalties


The purpose of a CMS penalty is to enforce regulations. Some penalties are automatic and directly related to PBJ reporting failures or errors, and others are for more persistent or severe problems that cause harm to residents.  

Automatic Penalties


CMS uses your PBJ reporting as the data source for your nursing home’s five-star quality ratings. You receive points based on staffing measures, quality outcomes, and health inspection results. Staffing measures have substantial weight on your score and problems may cause automatic penalties.  

CMS currently excludes turnover measures from your total score if you don’t submit turnover staffing data. However, this will end in 2024. 


As of April 2024, CMS will implement a new penalty to automatically lower your turnover rate to the lowest possible score if you don’t submit PBJ data. Turnover rates account for half of the staffing measures, so these changes will dramatically influence your star rating. 

Missing a PBJ reporting deadline also impacts your star rating. CMS automatically drops your facility to one star if you skip a deadline. The penalty lasts for one quarter.  


Problems with staffing hours will also lead to an automatic penalty reduction in ratings. For example, data that shows you had four or more days in the quarter with one or more residents but no RN staffing hours will automatically receive a one-star staffing rating. This penalty will also last for one quarter. 


In addition, CMS performs regular and random audits to confirm data and accuracy. Facilities that don’t respond to an audit or have an audit that shows significant errors in staffing hours will downgrade to a one-star staffing rating for three months.  

Penalties for persistent errors or actual harm 


In most cases, CMS gives you a chance to correct inaccurate data or any problems with staffing, often with a plan of correction. However, repeated discrepancies, purposeful blindness to regulations, or severe non-compliance that harms or may harm patients can lead to more significant penalties. 

Suspended Medicare or Medicaid payments

One of the fastest ways for the government to incentivize action is to withhold payment. CMS will do just that if your facility doesn’t comply or is repeatedly delinquent. CMS may withhold or deny all payments for current Medicare or Medicaid patients in your facility and new admissions from patients on these programs.  

Transfer of residents and facility closure

Errors or non-compliance that endangers or harms patients are serious matters. If CMS finds that staffing or other deficiencies jeopardize patient health and safety, you may face a forced facility closure. CMS may terminate your contract within two to 23 days of discovery and transfer residents from your nursing home to another location for more appropriate care 


CMS and the State may impose financial penalties or fines for each day a facility is noncompliant with requirements or for every instance. You may receive these even if deficiencies don’t place patients in immediate jeopardy.  


The penalty values vary from: 

  • $3,050 to $10,000 per day of immediate jeopardy 
  • $50 to $3,000 per day of non-jeopardy 
  • $1,000 to $10,000 for each instance of deficiency 


Once CMS issues a fine, you can’t avoid it. You must pay, and these add up very quickly. Fines often start accruing when you are first out of compliance, making PBJ data and staffing management essential. However, the Center will consider your performance history, financial situation, the severity and frequency of deficiencies, and how those deficiencies relate to each other.  

What causes PBJ penalties and how to fix them 


The root cause of PBJ reporting penalties lies in your daily operations. The processes you follow, the tools you use, and how you collect data can all affect your measures and timely submissions. Understanding these factors and how to overcome them can transform your reporting and help you streamline compliance.  

Missed PBJ reporting deadlines 


Many factors can influence how well you submit data on time, whether it’s absent healthcare HR staff or facility emergencies. However, missed deadlines are usually due to two main factors: disorganized data submission processes and time-consuming data collection that cause delays.    

One of the easiest ways to get control of your time in data collection and processing is to auto-collect it through healthcare HR software with custom reporting features. Use payroll and timekeeping modules to track staffing hours and merge those touchpoints into a single report. Then, export PBJ data with a single click and upload it to the CMS.  


Data collection on auto-pilot organizes the entire process and will prevent any last-minute disruptions from wreaking havoc on your submission deadlines. Additionally, simple practices like setting reminders can alert you of upcoming deadlines and keep you on track.  

Inaccurate or missing data 


The staffing portion of payroll-based journal reporting involves six measures: three for staffing turnover and three for staffing hours. CMS uses job codes to differentiate between positions, such as a nurse aide or RN, and employee IDs to track turnover.  


Problems with inaccurate job codes or changing employee IDs will alter your data and accidentally report inappropriate staffing or turnover. These mistakes skew your performance and may lead to penalties despite actual compliance.  


The answer to better, more accurate data is to scrap manual or paper-based methods and embrace automation. The right software links your payroll to other HR modules, allowing faster and more accurate data collection and records. Finally, use a digital healthcare staff scheduling software with timekeeping functions. These features simplify time tracking and increase accuracy. 

Staffing non-compliance 


Inaccurate data may be one cause of technical staffing non-compliance. However, persistent staff shortages, inappropriate scheduling, and insufficient HPPD are symptoms of a bigger staffing problem.  


Eventually, these practices and factors can risk patient health and safety and cause deeper issues with staff burnout, frustration, and poor retention. The fallout is expensive and risky penalties.  


If you maintain proper staffing ratios and still have errors, check your data for problems with employee IDs and job codes. Additionally, use healthcare staff scheduling software that simplifies HPPD. These platforms should allow you to set HPPD limits and automatically calculate your shifts, no matter the number of patients.  


Most importantly, hire and schedule sufficient staff. If you have frequent worker shortages, it might be time for new recruitment and staff retention strategies. These might include: 

Better onboarding

Competitive wages

Flexible scheduling

Partnerships with education institutions

Caregiver pools or nurse floats

Travel nurses

Power compliance with intelligent solutions

Payroll-based journal reporting is mandatory for skilled nursing facilities or nursing home operations. A disorganized or outdated data collection process can lead to missed deadlines, inaccurate data, and insufficient staffing, resulting in costly penalties.  


The upside is that every penalty is avoidable. With the right staffing policies and healthcare HR software like Empeon, you can empower your facility to excellence and compliance. Empeon brings all the essential tools into one user-friendly platform, creating a seamless payroll and reporting experience.  


From intelligent talent acquisitions and automated onboarding to flexible payroll and time management, Empeon helps you leverage technology for a simple, more compliant process. Learn more. 

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