Cutting Medicaid by 5% would spur loss of nursing home jobs, economists say

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SNFs could see 50% payment reduction for Pre-Existing Condition Insurance Plan claims
SNFs could see 50% payment reduction for Pre-Existing Condition Insurance Plan claims
Cutting the state-federal Medicaid program by 5% could result in the loss of thousands of jobs in nursing homes and other healthcare-related industries, a new report finds.

Cuts to Medicaid by Congress, which pays for 43% of U.S. long-term care services, are looking increasingly likely, according to The Hill. A 5%-Medicaid cut would likely cost states — which will soon be tasked with widening their roles under the Affordable Care Act — $14 billion total, Reuters reported.

Economists told Reuters that cuts to Medicaid are problematic because Medicaid spending boosts local economies through payments to healthcare providers and their employees via federal matches. California would be the hardest hit by a 5% Medicaid cut, with an expected loss of $3.7 billion and a loss of 28,440 positions, the National Association of Public Hospitals and Health Systems told Reuters.

"Such a drastic reduction would stifle business activity and job creation in states already struggling through the recession," a National Association of Public Hospitals and Health Systems spokesman said.
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