Nursing Homes Fear Proposed Payment System Will Create Winners And Losers

Nov 20, 2016
Originally published on November 22, 2016 2:18 pm

Nursing homes are gearing up to fight a plan that could result in what they say are widely varied Medicaid reimbursement rates. Its part of a legislative push for efficiency, but the move is worrying providers in the $4.8 billion program.

Most people will have some interaction with a nursing home, whether it’s personally or through a friend or family member. And Florida has one of the largest population of seniors, making it a graying state. And that, says Tom Parker, is why people should be paying close attention to a looming fight over Medicaid reimbursement rates to nursing homes.

“Large parts of this state will eventually need nursing facility care. You want to make sure they’re being adequately reimbursed so they can provide good quality service to you when you’re in there and that the citizens of Florida receive good quality care when they’re in our nursing homes," he says.

Parker oversees Medicaid payments for The Florida Health Care Association, which represents nearly 80 percent of the state’s nursing care facilities. Some of those homes depend on Medicaid, the healthcare program for the poor—while others, not so much. And there’s growing discord over a plan by the Agency for Healthcare Administration to create a so-called quality-based payment structure. Steve Bahmer heads Leading Age Florida.

“The care you receive in a five-star gold seal nursing home, is not the same you receive at a one-star facility. It can’t be," he says. "The idea you would treat them the same and pay the same for them, it doesn’t make any sense.”

The payment scheme, as envisioned, would take existing Medicaid dollars and redistribute them, resulting in some nursing homes getting more, and other nursing homes getting less. The state is forging ahead with a one size fits all model. The proposed payment system is aimed at curbing retroactive payments to nursing homes at a time when Florida lawmakers are trying to decrease the cost of Medicaid-- the largest single program in the state budget. Every year nursing homes are audited and those that are overpaid have to return the money, while those that were underfunded, get reimbursed. Bahmer says the state could just eliminate the retroactive payments all together:

“Freeze rates where they are today. Don’t pay any more or less than what we pay today. Eliminate the look back going forward. Problem solved. It’s that simple.”

Except, it’s not..

"You want to make sure you’re paying people what they’re actual costs are. So you have to do an audit and work through—verify what they’re spending. To stay in the current system and get rid of the retroactive process is not feasible,” says the FHCA's Parker.

So, while most nursing homes agree changes should be made, there’s widespread disagreement on how to do it. The conversation comes at a time when the state is under-funding nursing home care by $150 million a year Parker says.  Florida lawmakers are expecting a tight budget, and Parker expects Florida lawmakers to begin debating the issue, but not settle it this upcoming legislative session.  

"If the industry can get together and compromise," he says, "I think there’s a good chance it happens. If it’s something that’s going to be very complicated and there’s a lot of division in the industry about it, they’ve got a lot of important issues they have to tackle, and I don’t know where nursing homes fall on the list, but they’re probably down a few sports.” 

Or maybe not. Incoming House Speaker Richard Corcoran has said healthcare and education cuts won’t be off the table, and Medicaid is one of the largest parts of the state budget.

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