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New Studies of Bush Administration $770 Million SNF Medicare Cut Find Seniors' Care Jeopardized, Local Jobs Lost, National and State Economies Threatened
Date:5/13/2008

National Long Term Care Leaders Warn Illogical CMS Regulatory Action a Serious Public Policy Misstep; Seniors' Nursing Home Benefits Take Biggest Hit in CA, FL, NY, TX, OH, IL, PA, NJ, MI, MA

WASHINGTON, May 13 /PRNewswire-USNewswire/ -- In releasing a new Lewin Group analysis of the Bush Administration's $770 million cut to Medicare-financed nursing home care, national and state long term care leaders warned the regulatory-driven cuts not only jeopardize seniors' access to quality nursing home care -- particularly in rural areas -- but also present a clear and present danger to the U.S. economy and the state and local caregiver jobs base.

During a media teleconference to release the Lewin economic impact data as well as new state-by-state impact analysis from the American Health Care Association (AHCA), Al Dobson, a Lewin Group consultant, said the so-called "Forecast Error" rule proposed on May 1, 2008 by the Centers for Medicare and Medicaid Services (CMS) represents a net negative total economic impact of $4.5 billion for FY 2009. In addition, the data finds, the $770 million decline in revenue will impact approximately $1.8 billion in wages, 43,530 jobs and approximately $661 million in federal, state and local tax revenue in the first year.

"In rural communities, where nursing homes are among the largest employers, the negative economic effects would be particularly damaging," Dobson observed. "Policymakers must understand and reconcile the dual dimensions of these Medicare cuts in that they not only directly impact seniors' access to quality nursing home care, but also have a negative ripple effect throughout our national, state and local economies."

First Year Economic Impact of $770 million Medicare Nursing Home Payment Cutback on the U.S. Economy:

Direct Indirect Induced Total

Business

Activity

Impact ($) $770,000,000 $458,953,536 $3,295,4
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SOURCE The Alliance for Quality Nursing Home Care; AmericanHealth Care
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