AHCA Sends Letter to Congress Opposing Using Medicaid Provider Taxes to Pay For Stafford Student Loan Subsidy

Tackle Budget Challenges Without Undermining a Key Medicaid Resource, Parkinson Says

WASHINGTON, June 6, 2012 /PRNewswire-USNewswire/ -- The American Health Care Association and the National Center for Assisted Living (AHCA/NCAL) today sent a letter to House and Senate leaders urging both chambers to reject a proposal to pay for Stafford student loan subsidies with reductions in the Medicaid provider tax rates, also known as provider assessments.

"Limiting states' ability to use provider assessments to finance their Medicaid programs would do nothing to reduce the cost of health care or make Medicaid more efficient," wrote Gov. Mark Parkinson, AHCA/NCAL President and CEO.  "While we know that Congress must find ways to reduce federal spending and fund a wide variety of programs, we strongly encourage you to consider more appropriate methods to encourage efficiency in federal health programs, rather than arbitrarily cutting important programs."

Last week, House and Senate Republican leaders sent a letter to the President offering reduction in the Medicaid provider assessments as a way to offset the cost of keeping student loan interest rates low.  The House of Representatives could vote on the measure as early as June 29.

A copy of the letter is below. 

June 6, 2012

The Honorable John Boehner                          The Honorable Harry Reid
Speaker of the                                               Majority Leader
House of Representatives                               United States Senate
Washington, D.C. 20515                                Washington, D.C. 20510

The Honorable Nancy Pelosi                           The Honorable Mitch McConnell
Democratic Leader                                         Republican Leader
House of Representatives                               United States Senate
Washington, D.C. 20515                                Washington, D.C. 20510  

The Honorable Eric Cantor                              The Honorable Richard Durbin
Majority Leader                                              Assistant Majority Leader
House of Representatives                               United States Senate
Washington, D.C. 20515                                Washington, D.C. 20510                      

The Honorable Steny Hoyer                            The Honorable Jon Kyl
Minority Whip                                                Republican Whip
House of Representatives                               United States Senate
Washington, D.C. 20515                                Washington, D.C. 20510

Dear Members of the House and Senate Leadership:

On behalf of the American Health Care Association, the National Center for Assisted Living (AHCA/NCAL), and our more than 12,000 member centers and communities nationwide, I'm writing today to express our opposition to a proposal that would use Medicaid provider assessment savings to offset subsidies to the Stafford student loan program. 

As a former governor, I realize the challenge to find appropriate savings in an increasingly tight budget often seems insurmountable.  There are never any "easy" decisions to cut programs. However, the current proposal from House and Senate Republicans to pay for offsets in student loan interest rates by reducing the Medicaid provider tax threshold from 6 percent to 5.5 percent would cause a ripple effect in every state where our care centers operate. 

A vast majority of nursing home residents rely on Medicaid for their nursing home care. This program is particularly critical for those seeking skilled nursing care. About 63 percent of nursing home residents have their stays funded by Medicaid, yet the program fails to fully reimburse facilities for the costs they incur. Facilities lose nearly $20 a day for each Medicaid resident, totaling a $6.3 billion loss in 2011, according to a report released late last year. This insufficient reimbursement for skilled nursing centers demonstrably threatens access to care for the more than 60 million people – largely children, the elderly and the disabled – who rely on Medicaid for health care coverage.

The proposed reduction to provider assessments would add an additional strain to a sector that has already been rattled with rounds of government reductions and threaten our ability to provide care to vulnerable seniors. More than 3.1 million Americans work in long term care centers, making our sector one of the nation's largest employers. Long term care centers are a meaningful job base in our communities. The federal government projects that there will be 72 million people age 65 or older in the U.S. by 2030, making the demand for long term care services and the people we employ only increase.

Limiting states' ability to use provider assessments to support their Medicaid programs would do nothing to reduce the cost of health care or make Medicaid more efficient. While we know that Congress must find ways to reduce federal spending and fund a wide variety of programs, we strongly encourage you to consider more appropriate methods to encourage efficiency in federal health programs, rather than arbitrarily cutting important programs. We want to work with Congress to find a more permanent solution to the continuous underfunding of Medicaid.

AHCA/NCAL agrees that steps need to be taken to reduce the federal deficit and address the nation's long term debt challenge. Our association is committed to working with members in both chambers of Congress to find long-term solutions for our nation's funding needs.

But we must tackle the looming federal budget challenges in a careful and deliberate manner - one that does not undermine the core values to care for our nation's seniors, including those who require long term care.

Sincerely,
//s//
Mark Parkinson
AHCA/NCAL President & CEO

SOURCE American Health Care Association