Report: Medicare cuts in Senate bill could lead to earnings losses at some nursing homes

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About one in five nursing homes, hospitals and home care agencies could fall into the red as a result of Medicare cuts in the Senate healthcare reform bill, a new government study finds.

"Providers for whom Medicare constitutes a substantive portion of their business could find it difficult to remain profitable," according to the report from government economic analysts at the Department of Health and Human Services. "Absent legislative intervention, (they) might end their participation in the program, possibly jeopardizing access to care for beneficiaries."

Also, the report warned that the new long-term care insurance plan included in the legislation risks being unsustainable. Premiums for the Community Living Assistance Services and Supports (CLASS) Act could be significantly higher than those projected by the Congressional Budget Office. Only a small fraction of the population likely would enroll, according to the report.