Indiana lawmaker proposes nursing home pay-for-performance bill

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An Indiana state Senate committee has advanced a bill that would reward better performing nursing homes while generally penalizing weaker ones financially. Sen. Patricia Miller (R) proposed the bill, and chairs the Health and Provider Services Committee that moved it along this week.

Critics say the payouts won't improve care unless they are tied to quality improvements. In the first six years of the existing program, the state awarded nursing homes $700 million dollars but didn't necessarily require the homes to use the funds to improve care, an Indianapolis Star investigation found. The newspaper charged that facilities used the windfall to support their bottom lines. Under Miller's bill, the money would be put toward quality bonuses and distributed through increased reimbursement rates to specialized facilities, the Star reported.

An estimated $194 million would be doled out based on health department scores and additional quality measures under the proposal. The new program would bring in an additional $48.5 million through a federal matching program. Additionally, the bill calls for spending $2 million per year on in-home services.