'Bad debt' funds mourned

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Skilled nursing facilities will experience $3 billion less in Medicare funding over the next 10 years due to recently passed legislation. A handful of states will absorb the worst of the cuts, according to a new analysis.

Florida ($60.5 million) and Ohio ($30.5 million) will see the biggest losses. They'll come due to the Middle Class Tax Relief and Job Creation Act of 2012, according to a study by Avalere Health for the Alliance for Quality Nursing Home Care.

“While SNFs, their patients and their workforce have absorbed a battery of funding cuts, Florida and Ohio facilities, especially, have taken a pounding in terms of cumulative state and federal funding cuts,” Alliance President Alan Rosenbloom observed.

Others hit hard (in order of dollar losses) will be Illinois, Pennsylvania, North Carolina, Louisiana, Indiana, Tennessee, Georgia and New Jersey.

“SNFs have no legal recourse to collect ‘bad debt' from state Medicaid agencies — and is more accurately described as ‘uncollectible debt' as mandated by federal law,” Rosenbloom said. He calls ‘bad debt' a misnomer; the federal government restrains states from collecting up to 90% of it.

Rosenbloom noted that skilled nursing providers are also slated to shoulder another $48 billion in Medicare reductions between fiscal years 2012 through 2021.
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