Missouri House Panel Recommends Increased Medicaid Reimbursement Rates for Nursing Homes

The Missouri House Interim Committee on Nursing Home Caregiving on Nov. 26 recommended a plan that would reform the system that the state uses to determine reimbursement rates nursing homes receive under Medicaid, which covers about 60% of the state's nursing home residents, the St. Louis Post-Dispatch reports. Under the present system, nursing homes receive daily, per-resident payments based on 1992 cost reports filed by the facilities, "annual adjustments for inflation and other factors" -- a method that has resulted in a "wide range" of rates. The committee has recommended that the state use more recent cost reports to update Medicaid reimbursement rates, which could cost the state an additional $57 million to $132 million per year, according to a state audit released this year. State Rep. Sam Berkowitz (D), chair of the committee, said that increased Medicaid reimbursement rates would improve the quality of care in nursing homes. Although Missouri faces budget problems, the committee said that the state could fund the proposal through use of the Medicaid loophole (Young, St. Louis Post-Dispatch, 11/26). Under the loophole, states pay city- or county-owned health care facilities more than the actual cost of health services, receive additional federal matching funds from the federal government and require the facilities to return the additional state funds. States may pay the facilities a small fee for their participation and use the funds to cover health- or non-health-related costs (Kaiser Daily Health Policy Report, 1/4). Missouri is expected to draw at least $270 million this year through the loophole.

Other Recommendations
The committee also advised the state to decrease the number of annual inspections at nursing homes that have "good records of compliance with health and safety codes." According to the committee, the state should inspect nursing homes that have had "no life-threatening violations" once, rather than twice, per year to "free inspection staffs to concentrate on facilities with considerable deficiencies." The committee also called on the state Department of Health and Human Services to develop a plan that would lead to "more consistent inspections" statewide. Dick Dunn, deputy director of the state Department of Health and Human Services, called the committee's plan a step "in the right direction." However, Violette King, head of Nursing Home Monitors, a consumer advocacy group, said that the proposal "sounds like all the stuff the industry wants" (St. Louis Post-Dispatch, 11/26).