California Seniors Face Estimated $350 Million 2013-14 Reduction in Medicare-Funded Nursing Home Care, New Analysis Finds

$75.9 Million Medicare Cuts Go Into Effect on January 1, 2013; U.S. Nursing Homes Face $65 Billion Ten-Year Reductions Due to Budget, Regulatory Payment Changes

California Seniors Face Estimated $350 Million 2013-14 Reduction in Medicare-Funded Nursing Home Care, New Analysis Finds

Alliance for Quality Nursing Home CareEllen Almond, 703-548-0019

A projects California nursing homes and the patients under their care face a $350 million cumulative reduction in Medicare funding in 2013-14 as a result of several different federal budgetary actions and regulatory payment changes made by Congress and the Centers for Medicare and Medicaid Services (CMS) since 2009. On January 1 2013, $75.9 million in California-specific Medicare cuts will go into effect due to existing federal budget law.

Nationally, nursing homes and the patients under their care face nearly $4 billion in reductions in 2013-14, and a $65 billion reduction over 10 years, according to the independent health policy advisory firm, . Nursing homes, technically referred to as skilled nursing facilities (SNFs), are California’s second largest health facility employer.

The analysis, funded by the Alliance for Quality Nursing Home Care, differentiates the impact of budget cuts and regulatory payment changes that result in less cumulative government funding to California SNFs. The Alliance maintains the successive battery of federal funding reductions undermine facility operations, disrupt staffing, and threaten seniors’ care amid the growing influx of older, higher acuity patients – increasing numbers of whom are able to return home after successful rehabilitation.

The Avalere analysis, the first retrospective national and state-by-state look at recent reductions in Medicare payments to facilities, projects the 2013-14 budgetary impact on California based on the following major government actions since 2009: ($124.6 million cut in 2013); ($129.5 million regulatory reduction in 2013); ($22.9 million regulatory reduction in 2013); ($75.9 million cut on );

“More Medicare cuts from Washington – which will occur in just over four months under the pending federal sequester provision – undermine California facilities’ ability to continue sending more and more patients home as quickly as possible,” said Alan G. Rosenbloom, President of the Alliance. “The unintended consequences of these cuts and regulatory payment changes will affect patient access, quality and require that care increasingly be rendered in settings that actually the cost to government. This makes no sense, and is wrong for seniors, providers, taxpayers and the future of our entire U.S. health care system.”

With approximately 70 percent of facility expenses related to staffing, the impact of federal Medicare cuts combined with a fragile Medicaid system causes significant difficulties in regard to hiring and retaining the direct care staff that help make a significant difference in care quality and patient outcomes, Rosenbloom warned.

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