'Bed tax' reform threat looms

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Nursing homes could be hurt if the federal government lowers the Medicaid provider tax safe harbor threshold to reduce the national deficit, according to a January report from the Congressional Research Service.

The White House's 2013 budget proposes lowering the threshold to 3.5% from 6%, limiting states' abilities to fund Medicaid through the so-called “bed tax” and reducing matching federal Medicaid funds. 

This might cut federal payments by $21.8 billion from 2015 to 2022, according to White House estimates. 

The nursing home lobby has campaigned hard against any lowering of the bed tax ceiling.

“This is a significant source of income for providers who already face a significant shortfall in Medicaid reimbursement,” said American Health Care Association spokesman Greg Crist. 

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