Already faced with the prospect of absorbing $127 billion in Medicare funding reductions through 2021, the long-term care industry may find itself confronted with even more strife in the year ahead.
The failure of the Congressional “super committee” to find at least $1.2 trillion in savings to the federal deficit as required by the Budget Control Act of 2011 means that across-the-board reductions will be imposed, unless overturned by Congress and approved by the President before 2013. While Medicaid is exempted from the cuts, Medicare is not, and will experience a decade’s long reduction not to exceed 2 percent of the program’s yearly cost.
Leaders of industry organizations had pleaded with the bipartisan panel not to impose further cuts, contending that long-term care facilities can bear no more. “Over the past five years, a cascade of Medicare cuts, regulatory changes, rampant state Medicaid instability and other funding reductions has pushed America’s second largest health facility employer right to the edge, and placed our patients and workforce in a precarious position,” said Alan G. Rosenbloom, president of the Alliance for Quality Nursing Home Care (Alliance).
Rosenbloom warned that regulatory changes imposed by the Centers for Medicare & Medicaid Services (CMS) and implemented last October will result in the loss of 20,000–25,000 skilled nursing facility jobs, as well as preventing jobs from being created due to canceled facility expansions and renovations. “Against this dangerous backdrop, our sector is increasingly concerned that any further direct payment reductions or beneficiary changes will significantly impact seniors’ access to quality care,” he said, adding that the Alliance opposes any further changes that would reduce nursing home payments or increase Medicare co-payments for Medicare SNF patients. He said the Alliance supports:
● spreading recent Medicare regulatory payment changes over three years in a revenue-neutral manner;
● revising bad debt rules, while maintaining current policy for bad debts related to dual eligibles;
● reducing rehospitalizations by targeting individual facility performance using a measure that adjusts for geographic differences in readmission rates and distinguishing between SNF post-acute patients and long-stay nursing home patients; and
● reforming Medicare’s post-acute care payment system basing payments on patient needs instead of site of care.
The rehospitalization proposal is in tune with an Obama administration plan required by the Affordable Care Act under which SNFs with above-average rehospitalizations would have their reimbursement rates cut by up to 3 percent beginning in 2015. However, the Alliance urged CMS to include the provisos involving geographic differences and level of patient sickness in the policy.
One of every five Medicare beneficiaries discharged from the hospital and sent to post-acute care facilities such as SNFs is readmitted within 30 days at an annual cost to Medicare of more than $17 billion. “The ongoing decline in hospital length of stay that began in the 1990s continues to result in the discharge of sicker patients to SNFs,” Rosenbloom explained. Gaps in care coordination between acute and post-acute settings, such as inadequate exchange of information about care and treatment in acute settings or lack of medication, are widely cited as contributing to rehospitalizations.
“We believe a fully effective rehospitalization program must cross care settings and align incentives across providers,” Rosenbloom said. “Until such a program is developed, the Alliance supports establishing an interim initiative to reduce Medicare rehospitalizations from SNFs based on the administration’s proposal.” Mark Parkinson, president and CEO of the American Health Care Association, said the plan to reduce readmissions would save about $5 billion over 10 years and should be seriously considered by Congress and the administration.
Meanwhile, as the pressure on the industry continues, adverse publicity caused by a few bad actors does not help and could encourage further anti-industry action—particularly in an election year.
In early November, the Senate Special Committee on Aging held a hearing regarding the quality of care in assisted living facilities and the proper regulatory and oversight role of federal and state governments. The hearing was prompted by reports in the Miami Herald detailing problems with care in Florida that reportedly resulted in some 70 resident deaths since 2002 due to negligent care. The three-part series said 1,732 homes were caught using illegal restraints and that patient records, including some involving deaths, were falsified 181 times.
Sen. Bill Nelson (D-Fla.) cited reports of patient abuse in other states and questioned whether stronger federal oversight is needed. “This doesn’t mean that assisted living facilities across the country have failed,” said Nelson. “I know of many in my state that are honest providers and are genuinely caring for residents and operate high-quality homes. We have quality [facilities] across the country. But even one case of misconduct is one too many.”
Nelson pointed out that some states do not have patient disclosure requirements that allow families and patients to make sound choices about which facilities to select. Furthermore, he said, state inspection standards and requirements vary widely.
Dave Kyllo, executive director of the National Center for Assisted Living (NCAL) decried the events described by the Miami publication and said such actions should be dealt with “swiftly and sternly.” NCAL submitted 18 pages of testimony detailing industry policies and actions aimed at providing quality care and proper treatment of patients.