Analysis: Long-term care could lose billions with block grants; funding answers available

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Nursing homes will be subject to escrow for all civil monetary penalties, CMS announces
Nursing homes will be subject to escrow for all civil monetary penalties, CMS announces
The long-term care industry would be the third-most impacted healthcare field if state Medicaid funding is converted into block grants, according to a new analysis from Bloomberg News. 

During recent and ongoing budget debates in Washington, Republicans have repeatedly suggested converting Medicaid funding into block grants for states as a potential cost-saving option. In a new analysis of those proposals, Bloomberg finds that converting Medicaid money into block grants could translate into billions of dollars worth of cuts to long-term care programs.

Capping the growth of Medicaid through the introduction of block grants could lead to anywhere from $53 billion to $154 billion in reduced overall Medicaid spending between 2012 and 2019, according to Bloomberg projections. Under the Bloomberg News scenario, long-term care facilities would lose between $8 billion and $23 billion.

Managed care plans would be the hardest hit, losing between $15 billion and $45 billion, followed by hospitals, which could lose between $11 billion and $33 billion.

The American Health Care Association and National Center for Assisted Living responded to the Bloomberg analysis by saying that block grants would put the care of the frail and elderly at risk. According to AHCA/NCAL President and CEO Mark Parkinson, block grants put the Medicaid safety net at risk “because there are no requirements for specific types of care or eligibility.”

In 2010, Medicaid underfunded nursing care facilities by roughly $5.6 billion, according to AHCA/NCAL. Medicare reimbursements are largely credited with offsetting some of that shortfall.  However, many providers are still “leaving Medicare dollars on the table,” experts acknowledge

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