Nursing homes challenge regulators' authority to cut Medicare payments

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Bruce Yarwood, AHCA CEO
Bruce Yarwood, AHCA CEO
Leaders of the largest nursing home association in America are openly questioning the legality of federal regulators' proposal to reduce Medicare reimbursement levels by 3.3% in fiscal year 2009.

Officials with the Centers for Medicare & Medicaid Services are calling their proposed payment cut for fiscal year 2009 a "forecast error correction." They say the reduction will correct an error in forecasting budget neutrality for case-mix adjustments in refining the Resource Utilization Group system for fiscal 2006.

"We believe that the forecast error correction is unacceptable under the law and completely ignores the rise in the acuity of nursing home patients," said American Health Care Association President and CEO Bruce Yarwood in comments submitted to CMS. "We strongly recommend and ask that you remove this adjustment."

"Certainly, CMS must appreciate how cutting Medicare SNF PPS payments only compounds the effect of chronic Medicaid under funding of long-term care for America's most vulnerable citizens, not to mention the major impact these cuts would have on frontline caregivers and quality of care," the AHCA statement read.

Forty members of the Senate and 110 in the House have signed on to letters to Health & Human Services Secretary Michael Leavitt protesting the cuts, according to advocates. After concluding a public comment period, CMS is expected to issue its final payment rule for fiscal 2009 before Aug. 1, 2008.