Budget amendment would end bonuses for nursing homes with violations

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Sen. Tom Coburn (R-OK)
Sen. Tom Coburn (R-OK)
In the wake of the American Insurance Group (AIG) bonus scandal, the Senate approved an amendment to the budget bill that would eliminate bonuses paid to nursing homes and other government contractors that "fail to meet basic performance requirements."

"The public had every right to be outraged when AIG received $165 million in bonuses from public funds, yet few taxpayers realize the government has spent billions on improper bonuses for the defense industry, non-performing contractors and incompetent executives at places like Fannie Mae," according to Sen. Tom Coburn (R-OK), who introduced the amendment.

Amendment 892 targets nursing homes among other industries. The Centers for Medicare & Medicaid Services pays more than $312 million a year in quality-of-care bonuses to nursing homes that provide below average care and have past violations of health and safety regulations, according to Coburn's Web site. The amendment also ends bonuses awarded to contractors and government executives responsible for over-budget projects and programs that fail to meet basic performance requirements.

Nursing home provider groups, including the American Health Care Association, have said the bonuses are used primarily to bridge the financial gap between what states give to nursing homes and how much it actually costs nursing homes to operate, reports The Des Moines Register. The Senate and House each passed a budget bill last week. They plan to reconcile their versions when they return from their recess later this month.