NURSING HOME REFORM NEWSLETTER

January 10, 2005

SAVING THE PROVIDER TAX

We reported to you recently that the Provider Tax might be in trouble, and that the windfall of some $131 million to the state and $55 million to the nursing homes in the state would be lost. You remember that the nursing home industry sneaked the increase in the Provider Tax through the last session without public discussion. Then it came to light that nursing homes without Medicaid patients would have to pay the increase in the tax but get nothing back. Any nursing home with Medicaid beds gets approximately $3 back for every $1 they pay in. Four small nursing homes with no Medicaid beds have protested their plight, of course, but so far nothing has been done to help them. 

ENTER OUR HERO, TOM BURCH

Rep. Tom Burch (D-Louisville) saw the problem and entered the controversy early. He has had several meetings with the four nursing home representatives trying to figure out what to do. The last meeting even included a federal Medicaid representative from Atlanta. But alas no solution. The fed rep wouldn’t budge. Interestingly, the nursing home industry seems to be unsympathetic to the little nursing homes. Some of the big nursing home owners say that all the little nursing homes need to do is take in Medicaid patients and they would share in the tax windfall. Shannon Turner, commissioner of state Medicaid services, has tried to find a solution and once said she may have found a loophole for the nursing homes that take charity patients. But this will not be a meaningful solution for all of them, if any. Ms. Turner also has said that the feds have never made an exception like is being requested in Kentucky. Into all this gloom enter our hero, Rep. Burch, who tells me that "We will have this resolved in a week." Another lawmaker told me that he thinks Tom Burch "has a deal cooked." The last we heard from the cabinet was that there was no way to exempt the non-Medicaid nursing homes. Stay tuned.

FIRE ONE OVER THEIR BOW.

As the 2005 session of the legislature opened, three legislators introduced bills that would exempt the little nursing homes from the Provider Tax. House Bill 95, introduced by Jim Wayne (D-Louisville) and Jimmy Higdon (R-Lebanon) urges the federal government to exempt nursing homes with no Medicaid residents but also (and get this) would throw out the Provider Tax if the exemption was not obtained. "That’s firing one over the cabinet’s bow," said one legislator referring to the Cabinet for Health and Family Services which would stand to lose considerably in Medicaid money if the whole new Provider Tax increase was canceled. Rep. Burch is motivated in part, he says, "because I don’t want the state to lose that $131 million in Medicaid money." There was a similar bill on the Senate side, too. Senate Bill 62 was introduced by Sen. Dorsey Ridley (D-Henderson), but his bill does not include the part where the whole Provider Tax increase could be thrown out. Sen. Ridley said he filed his bill as a favor to close friends who own Shemwell Nursing Home in Providence, one of the small nursing home affected. Sen. Ridley said he is sympathetic to their plight. Shemwell representatives have been among the hot protestors of the legislation.

WHO WINS? WHO LOSES?

If someone the state Medicaid office or Rep. Burch  cannot find a solution to the dilemma the small nursing homes face, it is pretty sure that at least one of them, Taylor Manor Nursing Home in Versailles, for example, will file suit to have the courts overturn the law. It is doubtful that the legislation introduced to exempt the homes will pass. But it will get the attention of state officials who do not want to lose that Medicaid windfall. The whole thing could end up lose-lose with nobody winning.

WHAT ABOUT THE BIG GUYS?

There are nursing homes that do not take Medicaid residents that are part of big nursing home corporations. We know of two, Jefferson Place in Louisville with 44 beds and Tanbark in Lexington with 34 beds. They don’t have their dog in this fight because whichever way this thing goes they win. They pay the tax on their facilities without Medicaid beds just like the little nursing homes and get nothing back, but the two we mentioned are part of a 22-nursing-home corporation whose windfall from the tax, because it has nursing homes with Medicaid beds, will easily overcome the loss. Or, if the tax is thrown out in court, they will still survive because of their sheer bigness. Too bad, because the owner of the big corporation we refer to is a man who carries great influence in Frankfort. He was one of the architects of the Provider Tax increase and knows long-term care backwards and forwards. If the feds won’t budge, however, not even a heavy hitter can help.

WHERE SHOULD ADVOCATES FOR REFORM BE?

Advocates for nursing home reform should support the Provider Tax because it gives the nursing homes the money they need to hire extra front-line caregivers. Too bad that this wasn’t made part of the bill, but then no one had a chance to say because of the sneaky way the bill was handled. There was no chance for public discussion or input. Nursing homes have their million-dollar windfall for now but we don’t see any of them hiring extra caregivers. Instead, one of the trade associations that represents the nursing homes is, in fact, putting together a p.r. campaign that tells how great they are in providing good service to residents. One could almost choke for laughing at the ridiculous claims they will make. We would like to see the Provider Tax opened up again and amended to require the nursing homes to hire extra front-line caregivers. They can do it. They have the money.

QUOTE OF THE MONTH

"These four nursing homes that the Association (one of the two lobbying organizations for nursing homes) and Medicaid are trying so hard to put out of business probably provide some of the best care in the state. You can bet that if these folks don’t fix this mess that they have created, it will go to court. The line was stepped over entirely too many times during the writing and passing of this train wreck, and I really don’t think any involved really wants to see this go to court." -- Shelley LaNeve, director of nursing at Shemwell Nursing Home in Providence, Ky.

COMING SOON

We’re not ready to tell you all the details yet, but look for an announcement of a new organization dedicated to nursing home reform in Kentucky and a website. You will read all about it right here. 

AND REMEMBER,

Don’t let your loved ones become another silent victim of nursing home neglect.


P.S.

FROM A CONSERVATIVE’S JOKE BOOK:

Is it just me, or does anyone else find it amazing that our government can track a cow born in Canada almost three years ago, right to the stall where she sleeps in the state of Washington. And they tracked her calves to their stalls. But they are unable to locate 11 million illegal aliens wandering around our country. Maybe we should give them all a cow. 

CONSTITUTION 
They keep talking about drafting a Constitution for Iraq. Why don't we just give them ours? It was written by a lot of really smart guys, it's worked for over 200 years and we're not using it anymore. 

TEN COMMANDMENTS 
The real reason that we can't have the Ten Commandments in a Courthouse! You cannot post "Thou Shalt Not Steal," "Thou Shalt Not Commit Adultery" and "Thou Shalt Not Lie" in a building full of lawyers, judges and politicians! It creates a hostile work environment! 

(The above quips are from our guest conservative and funny enough to share.)