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Proposed Medicare Regulation Draws Fire
By
Stephen Baetge
Staff Writer
A
proposed adjustment to fiscal year (FY) 2010 payment rates to nursing
homes caring for Medicare beneficiaries — just announced by
the Center for Medicare and Medicaid Services (CMS) — has aroused
the wrath of long-term care advocates who are unconvinced by the
argument that the adjustment is necessary to better reflect the cost
of caring for these Medicare beneficiaries.
The adjustment calls for payments to Medicare skilled nursing facilities to be
reduced to $390 million less than the payments for FY 2009. This adjustment to
nursing facility payments is an effort to rebalance an earlier adjustment to
the case-mix indexes (CMIs).
The proposed FY 2010 recalibration of the CMIs would result in a reduction in
payments to nursing homes of $1.050 billion (nearly 3.3 percent). This decrease
would be largely offset by this fiscal year’s proposed update to Medicare
payments to skilled nursing facilities.
The update, a proposed increase of 2.1 percent (or $660 million for FY 2010),
is based on the change in prices of a “market basket” of goods and
services included in covered skilled nursing facility stays.
The percentage increase in the market basket is used to compute the update factor
annually. The combination of the market basket increase and the recalibration
of the CMIs yielded the 1.2 percent reduction.
“We understand that hospitals will be concerned about lower than historical
update amounts,” stated Charlene Frizzera, CMS acting administrator. “However,
we are proposing an adjustment that minimizes the effects on FY 2010 payments
while still meeting the requirements of the law, which may mean larger reductions
in the next two years.”
The proposal drew howls of protest from leaders in the long-term care industry
who contend that the change is at odds with the intent of the recent American
Recovery and Reinvestment Act in terms of creating jobs and spurring economic
growth, and [it] will hinder ongoing efforts to modernize Medicare for the benefit
of seniors and taxpayers.
“With Congress and the Obama administration so effectively focused on job
creation in the face of poor national and state economic conditions, this CMS
proposal is at fundamental odds with our broader economic and health policy objectives,
not complementary to them,” stated Bruce Yarwood, president and CEO of
the American Health Care Association (AHCA).
Alan Rosenbloom, president of the Alliance for Quality Nursing Home Care, was
equally critical of what his organization termed “the Bush CMS rule” and
the possible damaging impact of its sharp funding cuts.
“Backtracking in the manner CMS proposes will undermine the very core principles
of the Administration’s health policy goals, and [it] is antithetical to
the health system delivery reforms America needs and seniors deserve,” Rosenbloom
claimed.
“As the nature of America’s nursing home patient population continues
to change and evolve, it should logically be the policy of CMS to help facilitate
the ability of nursing homes to care for higher-acuity, post-acute Medicare beneficiaries,” he
added.
Yarwood and Rosenbloom both said one of the many flaws associated with the proposal
is that the proposed rule’s deep cuts will result in thousands of lost
jobs in the very sector well-positioned to create them.
The long-term care industry has been hit by major cutbacks in recent years in
the face of a recognized serious need for long-term care in the future.
A recent study of proprietary nursing homes by Dobson DaVanzo and Associates,
LLC found that despite having vacancies, nearly one-third of the nursing homes
surveyed had to freeze jobs in their facilities and forgo filling those positions.
Wages for current employees were also not increasing as a result of the economy,
the study found.
Advocates noted that many long-term care facilities have invested heavily in
recent years to increase their capabilities to admit, treat and return to home
a growing number of patients requiring intensive rehabilitative care and care
for patients with multiple chronic illnesses.
Implementing the proposed funding cuts, the long-term care leaders said, would
inhibit continued investments in cost effective care — contrary to the
Obama administration’s stated health policy objectives.
The AHCA and Alliance leaders also expressed concern that the CMS action to cut
Medicare-financed nursing home care would damage seniors in the many states across
the nation who have already endured or will soon face substantial Medicaid funding
cuts as a result of recent state legislative actions.
“Medicare and Medicaid funding are inextricably linked, and the combination
of cuts to both programs squeezes facilities in a manner harmful to Medicare
beneficiaries’ rising care needs, as well as to our local economy and caregiver
jobs base,” Yarwood stated.
“We urge the Administration and Congress to avoid adopting short-term,
budget-driven policies that are inconsistent with the goal of improving post-acute
care coordination and payment efficiency,” concluded Rosenbloom.
The proposed rule went on display on May 1, 2009, at the Office of the Federal
Register’s Public Inspection Desk and will be available under “Special
Filings” at: www.federalregister.gov/
inspection.aspx.
For further information, see www.cms.hhs.gov/center/snf.asp. Public comments
on the proposal will be accepted until June 30, 2009.
This page and its contents ©2009
Metropolitan News Company, Inc.
