Nursing Home Industry Leader Worries About Cuts To
Does not like Independent Payment Advisory Board in
health bill; opposes GOP plan to turn Medicaid into a block grant
By Phil Galewitz, KHN Staff Writer
25, 2011 - Mark Parkinson, who heads the nation’s largest nursing home
lobby, finds it hard to celebrate government estimates predicting an
explosion in the number of Americans aged 85 and older during the next
“This would be terrific news,
but the challenge is that at a time when we have this enormous demand on
resources to take care of older people, this country has never been in a
worse position to do it,” Parkinson, president and CEO of the American
Health Care Association, said at a briefing with reporters on August 19.
The association represents about 11,000 nursing homes and assisted
Parkinson, a former governor
of Kansas who came to the organization in January, said his group
realizes the pressure on Congress and the states to find ways to slow
the growth of Medicare and Medicaid, which together pay for most nursing
“We understand the budget
situation is so dramatic that the status quo can’t continue,” he said.
“We want to be part of the solutions to the long-term deficit.”
But Parkinson is critical of a
key feature of the new health law that aims to slow growth of Medicare —
the creation of an independent panel that will have broad authority to
recommend ways to curb Medicare spending.
Starting in 2015, the
Independent Payment Advisory Board -- a 15 member independent panel,
to be appointed by the president and confirmed by the Senate—would make
its recommendations if spending passed certain benchmarks. Congress
would be required to accept those or offer others that would achieve the
Like a number of other
provider groups that oppose the new board, Parkinson said Congress
should not give up its authority to a panel that is not directly
accountable to the public. “IPAB further erodes our ability to advocate
on behalf of older people,” he said.
Parkinson also opposes efforts
by Republicans to turn Medicaid, the federal-state health program for
low-income people, into a block grant program that would give states
more flexibility. "It potentially could be very bad for nursing homes,”
he said, citing the likelihood that providers would see additional cuts
The typical nursing home
counts on Medicaid to cover about seven out of 10 residents. Many states
are already curbing reimbursements.
In addition, nursing homes
receive money from Medicare. Those payments will be cut by $14.6 billion
over the next decade under the health law to help finance the coverage
for 32 million Americans who currently are uninsured. The first of those
cuts begin in October.
Parkinson said the industry
agreed to the cuts partly because it feared an even bigger one. But
reducing the number of uninsured Americans by 32 million under the law
by 2018 will do little for nursing homes because nearly all of their
residents already have coverage.
The association wants Congress
to consider paying nursing homes and other providers a single fee for a
patient’s illness episode rather than a per day fee. That way if a
patient needs a hip replacement, providers would determine how to split
up the money and would be rewarded only if the patients did well.
Another priority of the
association is making sure nursing homes can be
included in the new
accountable care organizations that will start next year in the
Medicare program and are expected to also be offered in the private
ACOs, which would be formed
most likely by hospitals and doctors, would get paid by Medicare and
other insurers a lump sum each year to care for a population and would
share in any savings if they can hold down cost while meeting quality
targets. “We don’t want nursing home to get left behind,” Parkinson
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