Greater good

A proposed nursing home fee that leverages federal Medicaid dollars may be a good investment for Kansas.

At first look charging Kansas nursing homes a new annual per-bed fee seems like a bad idea.

However, when you consider that the tax would raise an estimated $30 million and leverage an additional $57 million in federal Medicaid funds, and that almost all of that $87 million would be returned to Kansas nursing homes to help offset the 10 percent reduction in Medicaid funding they have faced in the current fiscal year, the proposal starts to make more sense.

A bill still under consideration in the Kansas Legislature would impose an annual tax of $1,325 on every licensed nursing home bed. That is not an insignificant cost, but it amounts to only about 2 percent of the $56,575 median annual cost for a person to live in a Kansas nursing home, according to Genworth Financial’s 2010 Cost of Care Survey.

That $30 million that would be collected in state tax, along with the $57 million in new federal funding would be distributed to Kansas nursing homes based on the percentage of Medicaid residents they serve. More than 90 percent of Kansas nursing homes would get back more than they pay in.

In a recent column written for the Wichita Eagle, the bill’s sponsor, Rep. Bob Bethell, R-Alden, said that 320 of the state’s 345 nursing homes would come out ahead. The other 25 homes would pay in more than they get back, he said, because less than 15 percent of their residents are on Medicaid. Although some nursing homes oppose the bill on the basis that it would force them to raise their rates for non-Medicaid residents, Bethell points out they could remedy that situation simply by boosting their Medicaid care above the 15 percent level.

Bethell, who noted he had been a licensed nursing home administrator in Kansas for 25 years, sees the fee as a way for Kansas to reclaim federal tax dollars it has sent to Washington. Thirty-seven other states have taken similar action, he said.

Industry groups for Kansas nursing homes are split on the bill based on how much the homes they represent would benefit financially. That’s understandable, but legislators shouldn’t lose sight of the elderly Kansans those nursing homes serve. To cope with this year’s 10 percent Medicaid cuts, some nursing homes already have raised their private pay rates; others have simply reduced staffing to make ends meet.

It’s true that the per-bed assessment will be better for some Kansas nursing homes than it is for others, but it’s hard to leave $57 million in federal funding on the table when that money could be used to help provide better care for some of the state’s most vulnerable residents.