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MedPAC Again Fails to Evaluate Overall Economic Conditions in Assessing SNF Funding Requirements
Date:12/7/2007

ent shortfalls to nursing homes in formulating its recommendations, MedPAC gives Congress and the public a flawed basis on which to determine the best policy -- not only for the Medicare program but, more importantly, for America's seniors and the workers who provide their care," Rosenbloom said.

With as much as 70% of nursing home operating costs driven by labor costs, inadequate overall funding may force nursing homes to make difficult decisions that could affect the hundreds of thousands of direct care workers in nursing homes - 86% of whom are women, and 30% of whom are minorities. "If the direct care work force becomes destabilized because nursing homes don't have the resources to make ends meet," he continued, "it is the patient who may suffer the most."

Rosenbloom also noted that the National Governors Association's (NGA) recent report that many states are facing budgetary shortfalls due to rising health care costs and the housing crisis strongly suggests that shortfalls in Medicaid payments could worsen. The report, released Wednesday, notes states are feeling pressure on both the revenue and spending sides of the ledger, and some states are already dipping into Rainy Day accounts to help make up the difference.

"When state revenues drop, the Medicaid program in general - and payments to nursing homes in particular - often face the budgetary axe," Rosenbloom continued. "Besides ignoring the new NGA report predicting a softening state budget fiscal picture, MedPAC has once again turned a blind eye towards substantial, ongoing Medicaid losses in determining the financial health of the nursing home sector. Therefore, MedPAC's recommendations offer little practical guidance to Congress concerning the impact Medicare policy will have on the quality of care provided to America's nursing home patients."

The Alliance President also said: "When pronouncing Medicare margins for the various health sectors, MedPAC should be obligated
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SOURCE Alliance for Quality Nursing Home Care
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