Health Reform Debate Heats Up - Don't Sit on the Sidelines

VHCA (10/30/2009)

On Thursday, October 29th House Speaker Nancy Pelosi introduced The Affordable Health Care for America Act (HR 3692) – the latest version of health care reform legislation in the House of Representatives. The bill seeks to combine the changes made during mark-up of the Tri-Committee bill by the respective committees of jurisdiction as well as to add changes seen as necessary for bill passage. Based upon an initial review by staff of the American Health Care Association (AHCA) of the nearly 2,000 page legislation, it appears that while much of the impact on post-acute and long term care will be the same as earlier versions; there are a few significant additions. 

Specifically, HR 3692 will increase Medicaid funding by $6 billion over four years into the long term care system with the development of the Temporary Nursing Facility Supplemental Payment Program (NFSPP).  Under this program, dually-certified facilities that have a Medicaid share of patient days not less than 60 percent, that have a combined share of Medicare and Medicaid patient days not less than 75 percent of all resident days, that are not on the CMS Special Focus Facility list, and that do not have any immediate jeopardy citations in their most recent standard survey will be eligible for such funding.  Additionally, the bill would extend the expiration date of the temporary increase in the Federal Medical Assistance Percentage (FMAP) provided in the American Recovery and Reinvestment Act of 2009 from December 31, 2010 until June 30, 2011.

The Medicaid proposals, while a significant step forward, do not lessen the need to fight to reduce the significant Medicare cuts contained within healthcare reform legislation.  Optimistically, the NFSPP provision represents a rare understanding by Congress of Medicaid’s funding shortfall issue with hope that the provision will lead to serious discussions as to the future of Medicaid funding.

As in the previous versions, HR 3692 eliminates the SNF market basket update for the last three quarters of FY 2010 (January 1, 2010 - September 30, 2010) and codifies the Centers for Medicare and Medicaid Services’ (CMS) “projection error” cuts of 3.3% and RUGs 4 provisions contained in the agency’s FY 2010 SNF PPS rule. The bill would also extend the current exceptions process for Part B therapy caps through December 31, 2011. Additionally, the new legislation contains nursing home transparency language, bundled payments for post acute care, workforce development provisions, and the CLASS Act – in the same manner as included in previous House versions.

Overall, the House measure would cut $104 billion from projected budget deficits over the next decade, according to the Congressional Budget Office, and would reduce slightly projected deficits in the following decade. The CBO's forecast for the House bill is less optimistic than for the bill that passed the Senate Finance Committee earlier this month, but it is significantly more positive than the analysis of the original House package.

Like the Senate measure, the House bill would be financed through new taxes and more than $400 billion in cuts to government health programs, primarily Medicare. But the composition of the tax increases differs significantly. The Senate is expected to propose a series of annual fees on health care providers and a 40 percent tax on high-cost insurance policies while the House would raise the bulk of its new revenue – $460 billion over the next decade – through a 5.4 percent surtax on the richest 0.3 percent of tax filers.

The differences between the House and Senate proposals to address health reform are significant and much work remains to arrive at an approach that will gain the support of both bodies.  Despite these differences, one thing is clear – Medicare skilled nursing facility payments are the target of significant funding cuts. 

Contact Your Member of Congress Today To Oppose Cuts To Medicare!
Both the House and Senate have completed committee work on their health care reform proposals and are now preparing for passage in their respective chambers.  At present the House bill contains $32 billion in cuts and the Senate bill contains $14.6 billion in cuts to our profession. AHCA/VHCA is calling upon all members to contact their legislators and tell them how these proposed Medicare cuts will impact skilled nursing facilities.  Even if you've already sent a letter, we need providers, family members, and residents to renew their grassroots advocacy today. Please click here to send a letter to your Member of Congress.