As Super Committee Makes Final Decisions, AQNHC Warns U.S. SNF Sector Will Already Absorb $127 Billion in Medicare Funding Reductions Between FYs 2012-21

As at Least 20,000 Job Layoffs, Staff Benefit Cuts Threaten Seniors' Care and Jeopardizes U.S. Jobs Base, Alliance for Quality Nursing Home Care Sums Up Top Level Legislative, Policy Priorities

WASHINGTON, Nov. 17, 2011 /PRNewswire-USNewswire/ -- As the Congressional Super Committee enters the final stages of its deliberations, the Alliance for Quality Nursing Home Care today detailed its top legislative and policy priorities, and warned the nation's Skilled Nursing Facility (SNF) sector is already slated to absorb a staggering $127 billion in Medicare funding cuts and reductions in the FY 2012-21 budget window due to legislative and regulatory changes over the past five years.

"Over the past five years, a cascade of Medicare cuts, regulatory changes, rampant state Medicaid instability and other funding reductions has pushed America's second largest health facility employer right to the edge, and placed our patients and workforce in a precarious position," said Alan G. Rosenbloom, President of the Alliance, a coalition of 12 leading post-acute and long term care organizations providing SNF care in approximately 1,400 facilities in 44 states nationwide.

Based on a recent national survey of SNFs conducted for the Alliance by Avalere Health, said Rosenbloom, regulatory changes made by the Centers for Medicare and Medicaid Services (CMS) implemented on October 1, 2011 are projected to result in the loss of 20,000-25,000 SNF jobs, and could result in another 20,000-25,000 jobs not being created due to cancelled facility expansions and renovations. "Against this dangerous backdrop, our sector is increasingly concerned that any further direct payment reductions or beneficiary changes will significantly impact seniors' access to quality care."

For this reason, the Alliance continues to OPPOSE:

• Legislative or regulatory changes that would adversely impact nursing home payments;
• Additional Medicare market basket reductions;
• Increases in Medicare co-payments for Medicare beneficiaries in SNFs.

At the same time, the Alliance continues to SUPPORT:

• Spreading recent Medicare regulatory payment changes over three years in a revenue-neutral manner;
• Revising certain bad debt rules, while maintaining current policy for bad debts related to the dual eligibles;
• Reducing rehospitalizations by targeting individual facility performance using a measure that adjusts for geographic differences in readmission rates, while also distinguishing between the SNF post-acute patient and the long-stay nursing home patient;
• Reforms of Medicare's post-acute care payment system that would base payments on patient needs, rather than on site of care.

Rosenbloom pointed out that SNFs also remain disproportionately reliant on Medicaid as compared to other providers, with Medicaid paying 57 percent of patient days. This year, he noted, nearly 30 states have cut Medicaid funding for SNFs. Two examples include Ohio, which has cut Medicaid SNF funding by six percent, and Florida, which has cut funding by 5.8 percent.

"Because roughly 70 percent of SNF patients are paid for by government programs (57 percent Medicaid plus 14 percent Medicare), the combined impact of Medicare and Medicaid cuts is pushing overall SNF operating margins below one percent now – before any additional policy changes or payment reductions are considered," the Alliance leader concluded. "As a lower cost institutional setting – with the ability to provide high quality care to a broad range of patients – SNFs are part of the solution to health care cost containment. Weakening the sector with an overwhelming barrage of regulatory changes and budget cuts – with yet more funding cuts contemplated – is counterproductive, illogical and wrong for America's health care system."

SOURCE Alliance for Quality Nursing Home Care