President Signs Health Care Reform Legislation into Law

VHCA (3/25/2010)

On March 23rd, President Obama signed the health care reform bill, the Patient Protection and Affordable Care Act (PPACA), into law. The legislation was passed along party lines 219 to 212 in the House of Representatives late on March 21, and was previously passed by the Senate on December 24, 2009. Passage of the PPACA is part of the “two bill” strategy, which required passage of a second bill which would “fix” elements of the passed health care reform bill under complicated budget reconciliation rules.

On Sunday the House took the first step in passing the reconciliation “fix” package along party lines. On March 25th, the Senate passed a slightly altered health care "fixes" bill, sending it to the House of Representatives for final approval. The so-called fixes bill was approved Thursday night by the House and sent to the President.  It makes minor changes in the overall health care reform measure.

The PPACA contains many provisions that impact post acute and long term care. Many questions have been raised about the impact that health care reform will have on nursing facility and assisted living communities as employers. To help answer some of your most pressing questions, please view the online AHCA/NCAL analysis.

The PPACA provides Medicare Part B therapy cap relief through calendar year 2010.  Congress had already passed a bill extending the exceptions process through the end of March. That bill also extended them retroactively to January 1 of this year. Therefore, the therapy cap issue is resolved for 2010.  The American Health Care Association (AHCA) reports that it will continue to work with allies on Capitol Hill to find a more permanent solution.

AHCA/NCAL has completed a thorough analysis of the bill. Below are listed some of the items that are anticipated to have the greatest impact on long term care.

The following positive provisions for post-acute and long term care were included in the passed health care reform bill:  

• No targeted reductions to the skilled nursing facility (SNF) market basket for FY 2010 or FY 2011.
• The MedPAC language, which was added at AHCA’s request, stating that Medicaid reimbursement must be taken into account by MedPAC during any analysis of skilled nursing facilities.
• Elimination of Medicare Part D cost-sharing for assisted living residents covered by Medicaid under Sec. 1115 or 1915 waivers or under a 1915(i) state plan amendment, who otherwise would be admitted to a skilled nursing facility. Copays for dual eligibles receiving services in a Medicaid managed care organization also are eliminated. This provision was included based upon NCAL’s leadership and successful advocacy efforts.
• Several provisions improving our nation’s health care workforce programs including a demonstration project providing further training opportunities specifically for direct care workers employed in long term care settings.
• The bill would establish the Community Living Assistance Services and Supports (CLASS) Act, a national voluntary insurance program that would allow people to finance their long-term care in advance through payroll deductions. It would provide a cash benefit of about $50 a day for long-term care, including nursing homes, in the home and adult day care.
• A Sense of the Congress statement on tort reform.
  State demonstration programs to evaluate alternatives to current medical tort litigation.
  New grants under the Elder Justice section for health information technology and workforce training.
• A General Accountability Office study and report on the Five Star Quality Rating System.

• A productivity adjustment to the skilled nursing facility market basket will be implemented beginning in FY 2012 (October 1, 2011) estimated to total $14.6 billion over 10 years.
• While implementation of RUG-IV was pushed back a year to October 1, 2011, neither the changes to concurrent therapy requirements nor MDS 3.0 were delayed- they take effect October 1, 2010.
• A new Independent Medicare Advisory Board (IMAB) was created to make recommendations to Congress about issues, such as Medicare payment rates for skilled nursing facilities. IMAB will submit a list of recommendations to Congress, on which Congress can vote to approve or disapprove. Some providers, such as hospitals, received an exemption from IMAB until 2019. Unfortunately SNFs were not given the same exemption.
• New transparency requirements for nursing facilities.
• Additional background check requirements for skilled nursing facility and nursing facility employees with direct patient access.
• Changes to reporting of crimes requirement in the Elder Justice section.
• The impact on employers of the health care insurance requirements.

We will continue to pass along updates as additional analysis of the PPACA is completed.