New Avalere Health Analysis: Ohio Skilled Nursing Facilities (SNFs) Take $30.5 Million Medicare Funding Hit Resulting From Congressional Passage of February Tax Deal

COLUMBUS, Ohio, April 4, 2012 /PRNewswire/ -- A new Avalere Health analysis detailing the negative impact on Skilled Nursing Facilities (SNFs) resulting from so called "bad debt" provisions passed in the Middle Class Tax Relief and Job Creation Act of 2012 finds Ohio SNFs will absorb a $30.5 million Medicare funding cut – the second largest cut nationally after only Florida. Nationally, the tax provision will cut U.S. SNF payments by at least $3 billion over the FY 2012-21 budget window. National and Ohio long term and post-acute care leaders say this latest SNF funding cut will place still more pressure on the state's facilities, patients and workforce following a 5.8% state Medicaid funding cut last year.

Alan G. Rosenbloom, President of the Alliance for Quality Nursing Home Care (AQNHC), which funded the analysis, pointed out that the phrase "bad debt" is a misnomer. The federal government itself, he said, prevents SNFs from collecting as much as 90 percent of SNF bad debt. "SNFs have no legal recourse to collect 'bad debt' from Ohio's Medicaid agency -- and is more accurately described as 'uncollectible debt' as mandated by federal law," he stated.

Peter Van Runkle, Executive Director of the Ohio Health Care Association (OHCA), stated, "Repeated cuts to Ohio SNFs negatively impacts vulnerable patients, workforce stability and threatens quality. We intend to make clear in 2012 to our U.S. Senators and House delegation that the default policy of more budget cuts is no replacement for thoughtful federal reforms that help our key health sector save Medicare resources and improve quality across the entire care continuum."

The following is the Top Five State Impact on Medicare Payments to SNFs resulting from the "Bad Debt" Provision in the Middle Class Tax Relief and Job Creation Act (amounts in millions; methodology notes available at www.aqnhc.org; *Discrepancy due to rounding):

Rosenbloom pointed out the U.S. SNF sector is already slated to absorb another $48 billion in Medicare reductions between FY 2012-21, and that SNFs also remain disproportionately reliant on Medicaid as compared to other providers -- with Medicaid paying for 57 percent of patient days. The new Alliance Spring 2012 Care Context policy paper details the fact that within the past 12 months, 32 states – including Ohio -- have cut or frozen SNF Medicaid funding.

Moving forward on the policy front, Rosenbloom pointed out that SNFs play a key role in the post-acute care continuum, and are poised to play a still greater role if Congress acts to rationalize the nation's Medicare post-acute payment system. In a recent Inside Health Policy news article, Rosenbloom and Avalere CEO Dan Mendelson detail the need for coordinated governmental SNF funding policy to help achieve greater efficiency in Medicare spending and improve quality.

The Alliance for Quality Nursing Home Care is a coalition of 10 leading post-acute and long term care organizations providing Skilled Nursing Facility (SNF) care in approximately 1,400 facilities, in 44 states nationwide.

Contact: Leigh Ann Bradley
(703) 548-0019

SOURCE Alliance for Quality Nursing Home Care