An unwelcome gift from MedPAC

Ho! Ho! Ho! Merry Christmas! What has Santa brought you this year? The usual: A preliminary recommendation to freeze Medicare rates for the following year.

It never fails that right before the holidays the Medicare Payment Advisory Commission drops a lump of coal into providers' stockings. This year, as in previous years, the advisory arm to Congress has suggested providers not receive a Medicare increase for 2011.

It was hardly a surprise when the American Health Care Association issued a statement earlier this week protesting the decision. David Hebert, AHCA's senior vice president of policy and government relations, called eliminating the market basket for skilled nursing facilities “irrational and irresponsible.”

He pointed out that significant cuts already have been made to Medicare nursing home care through a reduction, which went into effect Oct. 1. Providers estimate it would trim Medicare payments by $16 billion over 10 years. Then, of course, there is the threat that a final healthcare reform bill also could curtail Medicare spending. The House bill would slash Medicare payments to nursing homes by $23.9 billion over 10 years. 

This legislative proposal “is unsustainable in light of both the growing dependence upon Medicare to prop-up Medicaid, and the profession's ability to withstand such deep cuts,” Alan Rosenbloom, president of the Alliance for Quality Nursing Home Care, noted.

Of course (perhaps as a belated holiday gift), Congress annually opts not to implement MedPAC's recommendations.

That's also where healthcare reform could change things—both for the better and worse. On the positive side, a new proposed commission would oversee Medicare and Medicaid. Also, an amendment by Sen. Ron Wyden (D-OR) would require MedPAC to look at Medicaid funding when making recommendations regarding Medicare. Both are acknowledgements of the symbiotic relationship between the two funding sources.

Then again, the final legislation could contain a provision endorsed by President Obama to create an independent Medicare Commission that essentially would be a more powerful MedPAC. That means the new commission, unlike MedPAC currently, would be able to act on the reductions it recommends.

Until such ideas become law, providers are left to spend their holidays without that much-needed gift from Santa—who, of course, is really Uncle Sam. (Ever notice you've never seen them both in the same room at the same time?)