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AHCA/Alliance Detail Components of Long Term Care Economic Recovery, Jobs Plan

Proposal Focuses on State Medicaid Payment Accountability, LTC Sector Access to Capital, HIT, Workforce

WASHINGTON, Jan. 22 /PRNewswire-USNewswire/ -- Emphasizing both the need and opportunity to collaborate with President Obama and Congress to continue improving nursing home care quality, create new jobs, and bolster the U.S. economy, the American Health Care Association (AHCA) and Alliance for Quality Nursing Home Care today detailed a long term care economic recovery and jobs plan that focuses on state Medicaid payment accountability, boosting the long term care sector's access to capital, broadening adoption of Health Information Technology (HIT), and strengthening the sector's workforce.

"Our message to President Obama and Congress is America's long term care sector contributes significantly to the nation's Gross Domestic Product (GDP), and plays a vital role in America's economic health," explained Bruce Yarwood, President and CEO of AHCA. Citing a 2008 Lewin Group study, the AHCA leader said long term care accounts for 1.1 percent of the nation's Gross Domestic Product (GDP) -- $144.3 billion annually. "Every dollar invested in the long term care sector supports approximately five dollars of additional economic activity, and has a substantial economic impact in nearly every community across the country."

Alan G. Rosenbloom, President of the Alliance, said, "The post-acute/long term care sector is well-positioned to employ more than 100,000 currently vacant positions in nursing facilities, and countless more throughout the remainder of the sector. We also offer the unique opportunity to create as many as 100,000 construction jobs within 60-180 days for 'shovel ready' construction projects -- and can help lay the groundwork for a better care delivery system that improves quality, provides seniors more opportunity to receive care and services in modern settings, and that better controls health care costs for the benefit of U.S. taxpayers."

Yarwood and Rosenbloom also said that because a substantial amount of the economic stimulus package will be devoted to state Medicaid relief, lawmakers should help ensure that a specified portion of the funds are used to maintain current funding levels for nursing home residents. It makes little sense, they said, to provide state Medicaid funding on the one hand, only to see vulnerable senior's care needs suffer from subsequent cuts to their vital Medicaid-financed care on the other.

The national long term care leaders also pointed out that the sector depends heavily upon Medicaid, which pays for the care of roughly two-thirds of nursing home patients and 12 percent of assisted living residents. Unfortunately, Medicaid has historically paid less than the cost of care, with the program on average paying nearly $13.00 per patient per day less than the cost of nursing facility care. For 2008 alone, it was projected that Medicaid paid $4.2 billion less than the actual cost of care. In challenging economic times like those today, states squeeze Medicaid still more by narrowing eligibility, shrinking benefit packages, and slashing and substantially delaying payments to providers. Illinois, for example, takes six months or more to pay legitimate and approved nursing facility claims and California recently imposed an eight week payment freeze on providers.

If we are to both protect U.S. seniors' existing access to quality nursing home care as well as take advantage of the opportunities the long-term care sector offers to support prompt economic recovery and jobs creation, Yarwood and Rosenbloom recommended that the following components be included in the economic recovery package:

Medicaid Accountability - States urgently require enhanced federal Medicaid funds to avoid dramatic cutbacks that would threaten the health care safety net.

Access to Capital - Post-acute/long term care providers may have as many as 3,000 "shovel-ready" capital construction projects that could begin in 60-180 days. This could create as many as 50,000-100,000 jobs if $4-5 billion were available through long term, low interest loans. AHCA and the Alliance believe the best way to make these funds available to providers is through targeted changes in HUD loan practices and FHA loan guarantee practices.

Health Information Technology - Any initiatives to stimulate more widespread adoption of health information technology should encompass the post-acute/long term care sector. People do not receive care solely in hospitals or exclusively from physicians, particularly given the growth of chronic care needs and the efforts to move patients through the delivery system to the lowest cost setting appropriate for their needs. Excluding our sector from HIT initiatives is short-sighted, and will perpetuate discontinuity of information between doctors and hospitals on the one hand and post-acute/long term care providers on the other.

Work Force - The nation's nursing facilities have more than 100,000 current vacancies for registered nurses, therapists, licensed practical nurses and aides, with countless more unfilled positions within other areas of the post-acute/long term care sector. Retraining dollars and other incentives designed to expand the available labor pool would translate into immediate jobs. Any work force development initiatives in the economic recovery package should at least be applicable to the long term care sector, and AHCA and the Alliance urge that resources be specifically targeted to the sector, which could create jobs quickly.

For additional details related to the four-point proposal, go to or

SOURCE American Health Care Association
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