James Berklan

With college football season clearly on the horizon, there I was, wanting to play retired sportscaster Keith Jackson and yell, “Whoa, Nellie!”

The object of my concern was a no-doubt well-intentioned joint press release from consumer advocacy groups LTCCC and the Center for Medicare Advocacy.

Their push is to create medical-loss ratio rules for nursing homes. In other words, leveraging providers to prove that X amount of public funding is going toward direct resident care, or other designated uses. Until the case-building against skilled providers gains more credence, it’s going to be an uphill battle.

The lead argument is that nursing homes have experienced double-digit Medicare profits for the last 17 years, per MedPAC calculations.

The March 2018 MedPAC report refers to an 11.4% profit margin. That, however, is for fee-for-service Medicare only. That represents just 11% of total facility days and 20% of facility revenue.

In other words, 89% of days and 80% of revenue come from other payers, mostly Medicaid, which sport a -2.3% margin. Combined, the Medicare and non-Medicare margin for providers is only 0.7%.

The tortured logic and statistic abuse gets worse. Still in the first paragraph of the consumer groups’ joint letter, they say that the Centers for Medicare & Medicaid Services “finalized a new payment system” that gives providers $820 million in increased pay.

The new payment system is not responsible for the $820 million increase. The pay raise is mandated by law and represents a 2.4% market basket update. Last year, the raise was just 1%, which also was specified by law.

Then the advocates claimed providers will reap a huge windfall from the Trump administration’s new tax scheme. The only problem is providers struck out and are NOT going to enjoy any extra tax cuts.

It’s reasoning like the above that makes it tough to take anything that follows too seriously. It doesn’t help the consumer advocates’ case, and being overzealously tarred this way surely doesn’t help nursing homes’ image.

One can only hope for the day when this type of irresponsible behavior no longer takes place.