Nursing Homes Wary of Health Care Change

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by Sarah Butrymowicz

It’s too soon to say how nursing homes in the Bronx – and all over the country – will feel the impact of the health care bill, but there are some causes for concern, experts say.

Patrick Cucinelli, senior director of public policy solutions at New York Association of Homes and Services for the Aging, is particularly apprehensive about expansion of Medicaid coverage. He worries that mandates for additional coverage, in a state that is already struggling to fund its Medicaid program, will bring an added pressure to make cuts at institutional levels, like nursing homes, in order to free up funds to cover individuals.

Nursing homes in the New York have lost over $1 billion in revenue from cuts to Medicaid in the last three years and are chronically underpaid by the program, ranging anywhere from $15 to $25 dollars a day per resident.

At Morningside House Nursing Home, about 70 percent of revenue comes from Medicaid. Managed care and Medicare round out nearly all of the rest, with a small amount of private care.

But Medicare provisions in the bill could be problematic in the future as well. For instance, the bill includes productivity cuts to Medicare reimbursements, operating on the assumption that nursing homes earn more each year. But this sort of cut may make sense at hospitals, though not at nursing homes where many of the residents are receiving palliative care or are terminally ill, said Dr. William T. Smith, president and CEO of Morningside House. “It’s a different picture in long term care,” he said. “We don’t have the same care rates or discharge rates.”

The health care bill also creates a new advisory panel that will be charged with making Medicare more efficient, ideally offsetting any cuts. But Smith doesn’t think there is enough wasteful spending in nursing homes to make a difference. “I can’t anticipate this bill being funded out of efficiencies and productivity measures,” he said.

Also, the bill might help keep elderly people out of nursing homes by allowing them to stay home longer. The bill includes a new initiative, which establishes a trust fund, called CLASS. After five years, individuals who chose to pay in to the trust would have another small source of revenue to pay for home and community based services to keep relatives at home. Elderly people “need as much help as they can to stay in the community,” Smith said.

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