Governor Patterson recently released his 2010-2011 NYS budget.  Within the proposed budget we are seeing more cuts in Medicaid reimbursement and more taxes for those who pay for care out of their own pockets.  A proposed 1% increase in the nursing home assessment tax will make it that much more difficult for consumers to afford the cost of care.  These fees represent a gross receipts tax on nursing homes and as such go right to the state coffers.

Here is a complete run down on increased fees and cuts to Medicaid reimbursement for nursing homes:

  Governor Releases 2010-11 Budget

Commenting, "Our revenues have crumpled; our budget has collapsed," Governor Paterson released his 2010-11 spending plan in Albany on Tuesday, January 19, 2010. The $133.9 billion proposal, which represents a 0.9% growth from last year, includes $1 billion of cuts in the following areas: education, health care and administrative cuts. Additionally, the budget raises $923 million in new taxes (cigarettes and sugar drink product taxes), assessments and fees in the health care area. The Governor advances his plan suggesting that without these taxes and cuts we risk running a $60 billion deficit over five (5) years. He balances the budget via increased taxes, freezes and cuts!

Nursing Homes

In the nursing home area, the Governor proposes to save the State $140.2 million by implementing the following:

• Elimination of the trend factor paid to facilities from April 1, 2010 to December 31, 2010. Savings for the State $46.6 million; cost to facilities $108.4 million.
• Imposition of a 1% non-Medicaid reimbursable assessment. Revenue to the State $67.8 million; costs to facilities $67.8 million.
• Reduction of payments for bed holds to 95% of nursing home rate. Limit bed holds to 14 days and therapeutic bed holds to 10 days. Savings for the State $6.9 million; costs to facilities $16.1 million.
• Carving out of drugs presently paid for by Medicaid. Savings for the State $2.4 million; this appears to have no effect on the facilities' rate.
• Cap the amount of money paid for rate appeals. Savings to the State $16.5 million. Cost to facilities–we are unclear at present on how this will impact facilities.

In addition to the above, three other significant issues for nursing homes appeared in the budget.  They are:

• Implementation of the regional pricing system scheduled for April 1, 2010 is delayed eleven months to March 1, 2011.
• The Quality Incentive rate add on of $25 million will go forward April 1, 2010. This will be funded out of existing nursing home reimbursement levels as a reallocation.
• Extension of the TCU program by adding five sites and extending the program deadline.