State Nursing Homes Face More State Cuts

According to the Philadelphia Inquirer, PA Gov. Tom Corbett’s proposed budget, released last week, calls for a four percent cut in Medicaid reimbursement for nursing homes with the projected loss about $46.5 million.
That translates to an almost $8-per-day loss in the average Medicaid patient reimbursement of $194, according to the Pennsylvania Health Care Association.
Under the current budget, nursing homes are losing $19.23 per day to each Medicaid patient which is up from a $15.13 loss the previous year.
Corbett’s proposed Medicaid cuts also affect hospitals and other health-care providers, but that impact is not yet clear.
“Pennsylvania’s Medicaid program covers about two-thirds of residents in the state’s nursing homes,” Stuart Shapiro, president and chief executive of the Pennsylvania Health Care Association, said in a news release
The figure is even higher in Philadelphia at 75 percent.
Nursing homes took a significant cut in Medicare reimbursement rates starting in October when as much as 18 percent was cut from Medicare, the federal program that homes counted on to break even.
“We made a promise to care for our frailest elderly, and it’s a promise we must keep,” Shapiro said in a news release after reviewing Corbett’s proposed budget. “We understand the state’s enormous fiscal dilemma, and given the current deficit, we also understand why virtually all health-care providers’ line items were cut. But there’s a compelling case to be made for protecting our most vulnerable residents by restoring funding for nursing homes, and we intend to make that case to the administration and General Assembly.”
The news release stated over the last four years, the state has paid nursing homes $1 billion less than the actual cost of care for Medicaid residents and last year the gap between the cost of care and what nursing homes are reimbursed widened by 27 percent. Also, while all health care providers lose money for Medicaid patients, other providers have additional revenue sources to make up the difference. Two-thirds of nursing home residents are on Medicaid. With the recession, private pay patients are going through their assets faster and going on Medicaid sooner. The news release also stated unlike some health care sectors where staff cutbacks are easier, nursing homes are highly regulated and must meet minimum staffing requirements.