Health Policy Change Coming in Waves, Ready or Not

700Patrick Connole

By now, early in the Trump administration, it is clear that any and all policies are up for grabs. But even as issues like immigration and border security can be altered quickly with the stroke of a pen on an executive order, the changes coming to the Affordable Care Act (ACA) and other health care rules and regulations will take longer to unravel—measured in months and possibly years rather than weeks because Congress must act first.

What these reforms will mean to long term care (LTC), post-acute care (PAC), and assisted living is of course not known. If anyone can figure out how Congress will replace the ACA, and what if anything they decide will be to the liking of President Trump, is beyond a betting person’s capabilities. But one expert in analyzing the LTC-PAC universe says even with D.C.-based changes looming, the attention of providers, especially PACs, should not waver from two fundamentals that will survive: to get your clinical house in order and to get your costs down.

This is because the march toward value over volume and the trend for hospitals to tighten their PAC networks is only going to continue, no matter who resides at 1600 Pennsylvania Avenue, says Shawn Matheson, manager for Leavitt Partners. That doesn’t mean, he notes, that Congress and the administration won’t overhaul existing CMS bundled payment and related demonstration pilots. What it means, instead, is that hospitals and managed care payers will be narrowing networks even if policy goes in new directions.

“In the rapid shift to value-based payments, many hospitals and medical groups are shifting referral patterns and creating PAC value networks,” Matheson says. “I see two main ways of change that have brought about these shifts for hospital-to-PAC referral patterns. The first wave began since fiscal year 2013 when the Medicare hospital readmissions reduction program began and the second wave, a much bigger and much more sudden one, began in April 2016 with the advent of Medicare’s Comprehensive Care for Joint Replacement bundled payment program.”

These policies helped put hospitals on alert to partner with top PAC providers, those that demonstrate high-value outcomes, low-cost spend, and clinical specialization in order to reduce readmissions, he says.

“Bundled payments are creating winners and losers in the PAC space,” Matheson says. “Referrals are going to the high-value providers that can demonstrate value, and those actively willing to work on lowering their length of stay.” There is an inherent risk and reward for a PAC provider participating in bundles in that decreasing your costs has to be offset by the volume of referrals from the hospitals,” he says. “The key is to get hospitals to compensate with volume,”

This is happening even as skilled nursing care centers are being left out of some of this planning in favor of home- and community-based care in many cases. The pendulum, Matheson says, will likely swing back to using PAC providers as the first site of care. This is because more and more anecdotal evidence is emerging that too many patients are coming back to the hospital from the home- and community-based settings who should have gone to PAC care first.

With much of the ACA being eyed by Republicans for replacement, there is still an expectation the pay-for-value movement will survive, albeit in some new forms.

“We think bundled payments will continue in the new administration. CMMI [Center for Medicare and Medicaid Innovation], for example, has significant statutory authority to test payment models. We feel like the Trump administration will use that authority to test the models that appeal to them,” he says.

“Indications are favorable for more state control [under the Trump administration], with states implementing programs through Medicaid system bundles and advanced payment models.”

With this attention to new payment models continuing, the onus will be on providers to state their case to acute care entities. The key idea, Matheson says, is it pays for PAC providers “to really reach out to hospitals, MA [Medicaid Advantage] plans, and managed Medicaid to build stronger relationships.” And with that outreach comes the need for hard, cold data showing real outcomes success in an efficient manner. “Data talks in this new environment,” he says.

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Our Humanity— The Ultimate Goal and Measure in Long Term Care: Part 1


V. Tellis-Nayak

V. Tellis-Nayak

The day’s surprise came in the sixth meeting of NRC Health’s marathon series of interviews with clusters of long term care (LTC) residents and families. Life-long experience had prepared my wife, Mary, and me to lead this study. Still, we had not anticipated that so many new twists on old truths would set so many neurons firing full cylinder.

The Resident Surrenders
The surprise came when Marcie, a wizened 94-year-old, narrated the story of her first days at her LTC community. She felt anxious when she first arrived.

“It was not long before I got into the new routine. It came easy, I lowered my expectations.”

Marcie’s words were an electric jolt. I wondered what maledictions would have rained down if trial lawyers, regulators, and advocates were here listening to Marcie? These critics bemoan that LTC communities run on institutional logic; they do not support resident autonomy. Residents all too quickly surrender personal choice. Institutional routine asks new entrants to sacrifice individual lifestyles.

Did Marcie lower her expectations, and thereby surrender her independence? For a true answer, we need to look beyond what advancing age does to our body and see how far, how wide, and how deep its effects echo.

Self-Demolition In Slow Motion
When aging signals, my body starts to fall apart. The self-demolition occurs in slow motion, it is relentless, it spares nothing. Old age disables the body, dulls the best talent, blunts well-honed skills, and clouds beautiful minds. Worse, it chips away my self-image. I desperately grasp at any symbol that prolongs the illusion that I am still self-sufficient and in control.

As I stumble along on my final lap, the prospect of LTC threatens to uproot me and make me spend my last days among strangers. LTC centers are modern-day public symbols of human life at its most undesirable. They broadcast to the world that I am on my last legs; I am of little value, am a drain on resources. My life has no purpose, has no meaning, is not worth living. Many elders try to escape the humiliation and take the exit through suicide, active or passive.

Victories Of The Spirit
The dread prospect that drives many to despair, paradoxically, is also the test that vindicates the resilience of the human spirit. Research offers many a glimpse into human fortitude that can ride out the roughest waves and into the human quest for transcendence in the meanest conditions.

Meditate on the wisdom that shines through in the following findings of good research.
One in four Americans spends some time in a nursing center. One in three dies there after a stay of two years. Two in five of the lucky ones who live to be 85 die in a nursing center.
The 100 elders in 15,000 nursing centers who each year die by suicide, make up a lower rate than the suicide rate for elderly in the community. Half of the nursing center suicides occur in the six months after admission.

Up to 40 percent of nursing center residents and their families rate their satisfaction as “excellent;” 2 percent rate it as “poor.” Their judgment correlates with the state survey

Residents and families praise the staff for their care and concern, for their respectful ways, and for making residents feel safe.

Most LTC staff are satisfied by the quality of their workplace. Their greatest joy is knowing they make a difference in the life of the elders. LTC staff turnover is lower than in many service industries.

Fantasy Versus Reality
Three significant themes run through these scattered findings. First, the image of LTC in the public imagination is a cruel caricature starkly contradicted by the testimony from residents, families, staff, and state surveyors—the most credible witnesses to quality at ground zero.

The negative stereotype adds to the fear and anxiety of many elders. It is particularly unfair to the caregivers who, day in and day out, allay the fears of frail elders and make them feel safe, wanted, and respected.

Although mediocrity dogs LTC, a second underlying pattern shows through. The kindness of staff touches residents and families so deeply that they take in stride the irritants of group living. They do not blame a kind caregiver; they see the rush, delays, and missteps as normal to the give and take of life.

Beth, a feisty centenarian uncovered yet a third truth when she responded to Marcie. “It is like getting married,” Beth said wisely. “You fall in love, you get married, and you fall into reality. Sharing your life with another curbs your independence. You love each other, so you make the sacrifice and live happily ever after.”

You Get What You Negotiate
Our survival instinct has taught us well: When you cannot control the wind, adjust your sails; let not the best be the enemy of the good. Elders know the survival strategy too well: In life, you do not get what you deserve but what you negotiate.

The human spirit is indomitable in its quest for happiness. It adapts, accommodates, compromises, and concedes—shrewd tactics hidden under the guise of surrender. Many fail to recognize the silent victories of human ingenuity.

V. Tellis-Nayak, PhD, is senior research advisor at NRC Health, Lincoln, Neb. He has been a university professor, whose scholarly work has been published in national and international professional journals. He has conducted research in the United States and abroad, and his major findings have reached a wider public through his writings in trade magazines. He and his wife, Mary Tellis-Nayak, have co-authored a book, “Return of Compassion to Healthcare,” which upholds humanity as the ultimate measure of success of any human endeavor. He can be contacted at

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The Gospel According To The #AppGap…

The fine folks at Westminster-Canterbury are spreading the gospel: Technology can help...

The fine folks at Westminster-Canterbury are spreading the gospel: Technology can help…

Bill Myers

Good morning, ProviderNation. It’s been a pretty good couple of weeks for the fine folks over at It’s Never 2 Late. Just last week, they announced that they had entered their 2,000th care center. But, perhaps even bigger, they’ve had some scientist types take a look at their work. They have been weighed in the balances, and not been found wanting.

Researchers at Eastern Virginia Medical School and Virginia Wesleyan College found that 40 percent of residents in a Virginia Beach, Va., nursing care center who were outfitted with It’s Never 2 Late swag saw “a clinically significant reduction of antipsychotic drug doses,” while 86 percent of the test group saw at least a little reduction in their antipsychotic doses. The numbers get even better:

  • Staff and family reported a 54 percent reduction in behavioral outbursts;
  • Thirty percent of the test group stopped acting out altogether, and the intensity of other outbursts declined significantly, too;
  • Evidence of depression fell by 41 percent; and
  • Perhaps even most striking, staff’s stress indicators fell by nearly half, the study found.

‘Preach This Gospel’

Lead researcher Scott Sautter, an associate professor at Eastern Virginia, called the findings “very exciting and important.” He and his colleagues are preparing their report for a peer-reviewed journal near you.

But the good people at Westminster-Canterbury on Chesapeake Bay aren’t waiting another second to share the good news.

“I’m going to preach this gospel all around the country,” Westminster-Canterbury President and CEO J. Benjamin Unkle Jr. tells Your Humble Correspondent. “We’re not trying to sell a product; we’re trying to sell an intervention that works. The message is, engagement through computer technology is affordable and has dramatic impact.”

Now, it is notorious that technology isn’t a replacement for human care, but what Unkle and others find so encouraging about their findings is that technology, used as a supplement for the human at the center of care, can work miracles.

Unkle has seen the light...

Unkle has seen the light…


Westimster-Canterbury volunteered its Hoy Nursing Care Center on its campus as the site of the experiment because Unkle was convinced that what some knucklehead or the other calls the elder care #AppGap is leaving money—and more important, care—on the table.

“Once the staff finds out the power of technology to make their lives easier, you’re going to do it with existing staffing models,” Unkle says.

Like many, Unkle sees the day coming (quickly) where relatives or friends of residents won’t just ask about gyms, or pools, or televisions, but about its hard-core, individualized technologies.

‘Going to Explode’

“There’s going to be a huge market for this,” Unkle says. “It’s just going to explode. Figuring out an app that is hardware agnostic and that can be customized to that person’s functional level… Some entrepreneur is missing an opportunity to make this better.”

It’s Never founder Jack York (who, as you know, is Your Humble Correspondent’s Personal Tech God), reacted to the news from Virginia Beach with a hearty aw-shucks.

“It’s been fascinating to be along for the ride,” he says of the experiments. “But it’s not about iN2L, it’s about a forward-thinking organization refusing to be satisfied with the status quo when it comes to delivering care.”

‘Taming Content’

As revolutionary as the InterWeb is, though, it can be hard for anyone to figure out how to use it properly. Services like It’s Never help folks “tame content,” Unkle says.

Seeing the results of the Eastern Virginia study, Unkle says he immediately ordered his staff to take an additional 18 computers “out of mothballs.” Since then, his care center hasn’t had a single request, for even a single moment, of extra staff time.

Unkle and his new friends aren’t done yet, either. The money donated to support the latest study—$228,000 from Westminster-Canterbury Foundation board member Sue Birdsong—will help support two other studies on the interaction between personalized technology and cognitive growth, Unkle says.

“The results were so compelling,” he says of the most recent effort, “that we felt that we needed to release the data that we had and start promoting this. It had too great an impact.”

Bill Myers is Provider’s senior editor. Email him at Follow him on Twitter, @ProviderMyers.

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On Cheating Death…

The government claims it was defrauded by hospice because people didn't die fast enough. (Cartoon compliments the fine folks at WikiMedia Commons.)

The government claims it was defrauded by hospice because people didn’t die fast enough. (Cartoon compliments the fine folks at WikiMedia Commons.)

Bill Myers

Good morning, ProviderNation. There’s a terrific scene in the terrific movie, Erin Brockovich, where the feisty Erin confronts the cynical, smirking lawyers for the Big, Evil Company. After ticking off the human suffering the Big, Evil Company has caused, Erin reduces those smirking lawyers to dust:

“So before you come back here with another lame-a— offer, I want you to think real hard about what your spine is worth, Mr. Buda—or what you’d expect someone to pay you for your uterus, Miss Sanchez—then you take out your calculator and multiply that number by a hundred. Anything less than that is a waste of our time.”

That monologue has come to mind frequently lately as the government continues what it sees as a march toward “accountability” in elder care. Last week, a federal judge summarily dismissed a False Claims Act case against AseraCare, arguing that the best the government had offered was a mere difference of opinion.

The Shape Of Things To Come

To many providers, the case was absurd, anyway: the government arguing that hospice care—which is, at bottom, an effort to relieve pain and suffering—is not “medically necessary.” But drill down, ProviderNation, because the case is even more absurd than that. Court records show, for instance, that the government insisted that hospice wasn’t “medically necessary” even when AseraCare pointed out that some of the “victims” of the hospice care had actually died.  Take a moment and reread that sentence. Let it sit on your tongue. Rinse it on your pallet, and savor the aroma and balance, for three reasons:

1.)   Because you’ve just heard government lawyers claim that not even death is proof that someone needed hospice care in the first place.

2.)   Because you’ve also heard the government claim, a priori, that hospice care must be fraudulent if people aren’t dying fast enough.

3.)   And because there are likely to be a lot more cases like this one, after the Department of Justice announced it has created 10 “task forces” to crack down on elder care “abuse” by providers, and as government auditors pore through Medicare records of high-intensity therapy.

Same Problem, Different Expressions

We’ve reported often on provider advocates’ (increasingly frustrated) efforts to get regulators to focus on functionality rather than on cost as they sprint toward a value-based purchasing model. The fraud prosecutions are, to many providers’ way of thinking, the same problem, expressed in a different way.

“Throw all of those general business and economic principles out the window when discussing CMS payment models,” says Phil Fogg, an Oregon provider and board member at AHCA/NCAL. “They have created payment systems that incent provider behaviors which are no longer aligned with goals.  Then they want to accuse their contractors of ‘false claims’ and ‘fraud’ instead of taking accountability for their role in the problem when cost or utilization does not meet their goals.”

Recall, briefly, how official Washington recoiled from the mere suggestion that their health reforms involved “death panels.” Yet mark the sequel: Here sit government regulators and/or lawyers who say that fraud is proved by folks not being dead enough, and waste is curbed by making sure the best therapy is avoided.

Robin Hillier, an Ohio provider (and secretary treasurer of AHCA’s board), who is as close as this profession comes to its own Erin Brockovich, finds an irony that, at the same time regulators say they want to focus on “risk-bearing” payment, they’re doing everything they can to make sure providers take no risks for better care.

“The problem in health care is that it’s often a judgment call—‘Is this person sick enough to need hospice services?  How much therapy is really necessary after a stroke, a joint replacement, or a debilitating illness?’” she tells Your Humble Correspondent. “Much of these investigations of ‘fraud and abuse’ really come down to simply trying to reduce costs. Instead of clearly unnecessary services, there are often simply differences of opinion between health care providers. “

Value, Not Cost

And that’s just to consider litigation risk, Hillier says. She says she’s mystified that she hasn’t heard more from regulators about the real value of services, whatever they may be.

“How much would you think a fully functional knee or hip is worth? What price would you put on regaining your independence?  What do you think a good death is worth?” she asks, in full Brockovich voice.

For Fogg, policymakers must “establish their goals and provide clear value expectations that a provider is incented to want to achieve because of the economic benefit.”

Fogg has his own, freely stated argument (“In the SNF world, I would argue that we will not be aligned with CMS until we get to an episodic payment model—a solution that will properly incent providers to manage utilization and functional improvement in the most efficient manner possible”) . In the meantime, though, he says that it’s a shame that health care appears to be the place where reason and accountability go to die.

“By the way, supply and demand dynamics can also be discarded in health care,” he says. “Critical mass has resulted in more negotiating power and higher prices for CMS.”

Bill Myers is Provider’s senior editor. Email him at Follow him on Twitter, @ProviderMyers.


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Where Have All The Good Times Gone?

Medicare patients and provider advocates may be ready to storm the Bastille after audit contractors denied skilled nursing treatment to patients in at least three states.

Fin de regime? Financial analysts are worried, après moi, le deluge(Art courtesy fine folks at WikiMedia Commons.)


Good morning, ProviderNation. Political economy has long been known as “the dismal science.” But some things are true even if Lord Halifax says they are, and a great many of those who follow the economics of long term and post-acute care are asking themselves, “Where have all the good times gone?”

Despite a record fourth quarter for mergers or acquisitions, “it looks as if M&A fever may have broken,” the fine folks at Irving Levin Associates say, gloomily, in their latest report. “This could be the start of something small.”

We’ve covered some of the concerns about a demographic dip at length in this space. Another factor, though, is that old Washington bugbear (which we’ve also covered at length), regulatory certainty. It’s not so much the scale of changes that are happening—it’s the pace.

Regulatory Squeeze

“I didn’t think it could get worse, but it’s going to do,” says Irving Stackpole, a veteran analyst and my own, private Eeyore. “It’s going to get worse because of pressure by CMS to move from volume-based payments to value-based payments.”

It’s notorious, Stackpole and others say, that providers have built their businesses around a large Medicaid population, subsidized by a lower Medicare population with higher turnover. Now, though, the margins are being squeezed from both ends.

Just last month, a key congressional committee passed a bill that would reduce the amount states can collect in provider taxes. It could cost up to 20 states more than $8 billion in Medicaid revenue (because of the various perversities of the current system).

Meanwhile, regulators are speeding through their massive Rules of Participation rulemaking, and Congress is weighing even further value-based purchasing bill for Medicare. The Rules of Participation alone could cost care centers up to $75,000 apiece, advocates at the American Health Care Association say.

Well, now, say all the dismal scientists, that’s how the game works—some win and some lose. Except, for Stackpole and others, those who are bound to lose are those who don’t have much to begin with.

“The SNFs that are serving the most vulnerable populations, those SNFs are going to go bust,” Stackpole tells me. “We’re going to see even more closures, more beds come offline.”

Small/Independent Jeopardy

Stackpole is not on an island here, either. AHCA’s own James Michel, who it must be said is not easily ruffled, says he’s worried, too.

“We are particularly concerned about access in smaller and rural communities where there may only be one or a handful of facilities operating. CMS’ new payment models are rooted in risk-bearing models that make it very difficult, if not impossible, for smaller and independent facilities to participate successfully while keeping their autonomy,” Michel tells me in an email.

“While highly competitive markets can bear some degree of consolidation and constriction of the market, because the demand can be absorbed by the competition,” he adds, “smaller and rural markets with fewer providers certainly cannot. And even if they could, that isn’t necessarily a good thing. There is a growing area of research on the relationship between provider and payer consolidation, and increasing health care costs. In its attempt to constrain growing health care costs, CMS inadvertently may be promoting payment and delivery models that reward consolidation and force the closure of smaller facilities, thereby increasing overall costs and creating access problems for our most vulnerable populations.”

But don’t worry too much, because it can get worse, Michel adds.

‘Silver Tsunami’

“All of this is happening as we teeter on the edge of the ‘silver tsunami,’ where we are set to experience a rapid growth in the number of older Americans who will need long term care,” Michel says. “Are we shooting ourselves in the foot by adopting payment and delivery models that will result in a constriction of our long term care infrastructure at a time when we are going to most need it?”

The regulatory trends are frightening enough. But consider, again, the apparent cooldown in Wall Street’s ardour for seniors housing. What we’re all witnessing is money fleeing a sector from all sides. And that’s before we even consider the seismic shakeup we may be facing as younger adults wake up to their own history.

“If you have a 25-plus-percent under- or unemployment rate among millennials, redistribution will happen around invested capital. What would come out of the system is the capital invested in the insurance sector—a huge amount of the $2.7 trillion that’s spent goes into the pocket of some very well-heeled insurance companies—and that’s where the pushback comes from,” Stackpole says. “How could that surprise you?”

‘A Race To The Bottom’

All of this is completely predictable, but rather dismal, to contemplate, Stackpole says.

“Consolidation is the hallmark of a mature business life cycle,” he says. “And that’s where we are. You could not find a better example of a business cycle moving from its early maturing to its late decline than skilled nursing. You’ve got consolidation, you’ve got closure, you’ve got growing awareness in the market—these are all hallmarks of a profession in late decline.”

But the rubber, inevitably must meet the road.

“The people who really need that nursing center are the families of people who have neurological disorders, the families of people who have Alzheimer’s and dementia, and the people who really need a cardiac or a pulmonary rehab,” Stackpole says. “What they’re going to have to do now is drive 65, 70 miles. Does that matter? Maybe not to some guy at CMS in Baltimore, but to the rest of those people, it sure as hell does.”

So, if you happen to bump into Irving at some conference or other, make sure you buy him a drink or two. He could certainly use it.

“It’s a race to the bottom,” he says. “An absolute race to the bottom.”

Mad Props Dept.

On that cheery note, a couple/three bouquets to throw out.

First, to the fine folks at It’s Never 2 Late, who this week have entered their 2,000th care center.

Second, to the good people at Benchmark Senior Living, who’ve just been named the Boston area’s healthiest employer.

Finally, to Delaware’s own Susan M. Levy, MD, who has just been named president of AMDA—The Society for Post-Acute and Long-Term Care.

Bill Myers is Provider’s senior editor. Email him at Follow him on Twitter, @ProviderMyers.



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A Ruthless World…


SCHERERVILLE, IND.—Good morning, ProviderNation. Jack Heaney could talk a dog off a meat truck, but he preferred to harangue his victims until the paint peeled off the wall. He and his 10 children were always arguing, often on different sides depending on what room they were in, and were generally the kind of folk a publisher friend of mine referred to as “bicycle seat Irish.”

To say that it would take a special woman to love such a man is a grave understatement. But the difficulty in describing Ruth Adams is that you constantly run the risk of understatement.

How to convey the sweet majesty of the woman? She was in constant motion, and it seemed that she relied on a renewable stream of love—from the kitchen bands she played for seniors, to the volunteering at the Apostolate of the Handicapped, to the dozens of children and grandchildren she took on as her own. For those of us who were lucky enough to know her (and, as often as not, to be loved by her), the thought of life without Ruth is almost as obscene as the thought of Ruth without life.

Her cookies were the stuff of legend; her “dippy do” fought over so much at Heaney family gatherings that she began bringing double, and then triple, batches. Ruth was Jack’s third wife—he’d been widowed twice—but within a few short months, she was “mom” to Jack’s children. To Jack’s grandchildren (all 27 of us), she was ever “Grandma Ruth.”

If she ever felt an outsider (and who could blame anyone for feeling that way amongst the Heaneys?), she never let on. She introduced each of her extended family as “my son,” “my daughter,” &c.

“Step,” Grandma liked to say, “is a four-letter word.”

Jack Heaney, sadly, died suddenly in 1988, and Ruth was widowed for the second time (the love of her life, Ed Mullin, died in 1972, leaving her to raise two kids on her own). She later married Wally Adams, a fellow retiree, and Ruth folded even more children into the family.

The extended children of all her marriages were by her continually until she died under the tender care of the fine folks at Chateau Nursing and Rehabilitation Center in Willowbrook, Ill. (to whom, many thanks).

There were upper limits to her decency. Let the coins clink into the old margarine tub, let the Hank Williams Sr. play on the CD, let the cards be dealt, and may God have mercy on your soul. Ruth had no gift for bluff (“Who dealt this doodly-squat?”; “I’ve got a dog from every county”) but she had an utter gift for crushing those adoring grandchildren who had dared to take their seats at the card table.

By happy chance, I talked with Ruth on Friday, just two days before she died. She was feeling nostalgic, but—as ever—counseled love. “Make sure you tell the kids you’re proud of them, Billy,” she said. “ ‘Cause that’s all that matters. This life—it goes by so quickly.”

Death be not proud.

Bill Myers is Provider’s senior editor. Email him at Follow him on Twitter, @ProviderMyers.








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Who Let The Dogs Out?

A day gone to the dogs. (Photo courtesy the fine folks at WikiMedia Commons.)

A day gone to the dogs. (Photo courtesy the fine folks at WikiMedia Commons.)


Bill Myers

Washington, D.C.—Hello, ProviderNation. Some days you’re the top dog; others, not so much. On Tuesday, provider advocates took their turn getting dogged. It began with the House Energy & Commerce Committee voting to take a bite out of provider taxes. It ended with the fine folks at MedPAC barking about cutting Medicare.

As is so often the case, the bite was worse than the bark: The House committee marked up legislation that denies Medicaid to mega-lottery winners and prisoners. But buried in the text, contentious bone that it was, was section 4, which rolls back the caps on provider taxes from 6 percent to 5.5 percent.

That was enough to get AHCA/NCAL alpha dog Clif Porter to release the hounds. Provider advocates charged the InterWeb (and the hearing room) in full howl.

‘A Broken System’

“Provider assessments are an ESSENTIAL part of … the funding picture,” Pennsylvania Health Care Association honcho Russ McDaid tweeted. “PA … rates still lag NF costs more than $25/day!”

To outsiders, it may seem strange that an offer to cut a profession’s taxes would lead to bared teeth, not wagging tails. But the provider taxes help raise states’ Medicaid payments because the feds are required to match state funds. Around 20 states have maxed out their tax rates, so a cut in the provider tax is a cut in Medicaid rates. And not a small one, either: Ohio, Pennsylvania, and Florida each stand to lose more than $1 billion over 10 years if the cuts become law.

“Provider taxes are far from the best form of public policy,” says Good Samaritan executive Dan Holdhusen. “However, they prop up a broken system.”

Same Ole, Same Ole

But the dogs’ days were not done. Just a couple of hours after Tuesday’s House committee vote, MedPAC had some thoughts for skilled nursing providers.

MedPAC “recommends reforming their prospective payment systems to more equitably distribute payments among providers and better maintain access for all beneficiaries. It also recommends two years of restraining and rebasing home health and skilled nursing facility payment rates,” the group said in a statement.

To provider advocates, MedPAC’s report seems a bit dog-eared.

“This is the same recommendation MedPAC has made for the past eight or more years,” AHCA said in a statement.

Changing Models, Changing Math

But AHCA officials added they were hopeful that an old dog could learn some new tricks.

“Specifically, while MedPAC’s margin analysis includes Medicare, commercial payers, and Medicaid, the commission does not account for the decreasing proportion of overall revenue attributed to Medicare and Medicaid fee-for-service,” AHCA says. “First, MedPAC only notes a growing number of Medicare beneficiaries enrolled in Medicare Advantage plans, which in general pay less than their Medicare fee-for-service rates. Second, MedPAC indicates that Medicaid rates present less of a shortfall than in the past. Again, MedPAC bases this analysis on Medicaid FFS data and does not account for the rapid expansion of Medicaid managed care for long term care.”

Dog-tired as he undoubtedly was, Porter says he’s not tucking his tail between his legs.

The Dog Days

“If nothing else, days like this show how important it is to get our members engaged,” he tells Your Humble Correspondent, in his bravest Indiana Jones voice. “We have a great story to tell— we just have to tell it ourselves. Really proud how well folks responded at every level. We’ll need that kind of sustained effort from now on.”

Even if MedPAC were to get its way overnight, even if the provider taxes become law tomorrow, the dog days of provider advocates may only be beginning. On Wednesday, for instance, the fine folks at Kaiser Health News examined a private long term care insurance market that seems is begging to be put down. This space has already examined how investors are feeling skittish about long term and post-acute care. And it appears likely that the younger generation will, sooner rather than later, want their “share” of their elders’ wealth.

In other words, demand’s coming in the front door, but money is fleeing out the back.

So, dispense with the muzzles, ProviderNation. Cry havoc! and let slip the dogs of war.

Bill Myers is Provider’s senior editor. Email him at Follow him on Twitter, @ProviderMyers.




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