Indiana Nursing Home Group Files Suit to Block Reductions in Medicaid Reimbursement

A group of more than 350 Indiana nursing homes has filed a lawsuit to prevent the state from cutting Medicaid reimbursements, the Indianapolis Star reports. In addition, the group has asked for a court order to halt the reimbursement reductions "until the case is resolved." State Medicaid officials plan to cut reimbursements to hospitals, pharmacies and nursing homes by 5% to help reduce a "huge budget shortfall." According to state officials, Indiana has been subsidizing empty beds in nursing homes and must shift funds to community-based care. However, nursing home owners said that they have lost money "even without the cuts." The Star reports that at least 17 Indiana nursing homes have closed this year, affecting more than 800 residents. Nursing home owners attributed their decisions to close the homes in part to low Medicaid reimbursement rates. "The solution to underfunding is hardly to cut funding even further so that homes close," Arthur Logsdon, president of the Indiana Health Care Association, which filed the suit, said. Melanie Bella, the new state Medicaid director, said she was "somewhat surprised" by the lawsuit "in light of the fact that officials from her office have been meeting with nursing home owners for months to reach a compromise." She added that the state would fight the suit. "We're not making these cuts because it's fun. We're doing it because the system is broken," she said. Marion Superior Court will hold a hearing on the case Nov. 5. Indiana's Medicaid program covers the cost of nursing home care for about 30,000 state residents at more than 500 facilities (Barton, Indianapolis Star, 10/24). For further information on state health policy in Indiana, visit State Health Facts Online.