Issues

The Nursing Home of the 21st Century

The nursing home of the 21st century is more accurately described as a “nursing and rehabilitation facility” -- where nearly half of the people admitted are able to return home after a stay of approximately one month. This is a far cry from the unfortunate stereotype and common perception of a “nursing home” as a convalescent center where our chronically ill elderly go to live out their last days, with no hope of recovery. 

Today, with more Medicare beneficiaries spending time in a nursing home following a hospital stay on their way back home to an active and productive life, long-stay patients, on the other hand, increasingly are admitted when chronic conditions become too complex to be managed through home-and-community-based services (“HCBS”). The average length of stay for these patients has also dropped dramatically -- primarily because seniors’ increased access to HCBS means they enter nursing homes much later in the aging process. Nursing and rehabilitation facilities also treat longer-stay residents with chronic care management needs and cognitive impairments -- but even these residents reflect a higher degree of medical complexity than ever before.  

Among the primary reasons this is important in terms of today’s Washington policy debate is because of the need to rationalize Medicare post-acute payments, which currently structure payments based on site of service rather than patient ne ed. This undercuts patients, undermines choice, and ill-serves the U.S. taxpayer. Therefore, provider reimbursement policies should encourage movement of patients into the lowest cost setting capable of providing the high quality care and services that best meet a patient’s specific needs.    

Medicaid

Three of every four nursing home patients’ care is funded by Medicare and Medicaid combined.  That is a dramatic statistic and it is vital that our leaders understand the relationship between these two programs and how they relate to nursing home care. Medicaid payments are lower than Medicare payments for most nursing homes. Payments fell short of expenses by $12 per patient per day last year -- nearly $4.2 billion in unreimbursed costs for Medicaid-allowed expenses. Medicare funding is vital to filling that shortfall in expenses.  

Unfortunately, due to the current economic conditions and budgetary challenges facing our states, Medicaid programs across the country are seeing dramatic reductions in funding.  

As independent health experts and studies have corroborated time and again, Medicare and Medicaid funding must be viewed together – not in isolation. A combination of cuts to both programs presents a clear and present danger to every aspect of facility operations.