February 12, 2020, Steve Monroe, SeniorCare Investor - The games that states and skilled nursing providers have to play to try to get appropriate Medicaid funding has got to change. There has been a lot of talk about what may happen to supplemental Medicaid payments, most of which come under the guise of “provider bed taxes” and UPL payments, short for upper payment limits.
As far as I am concerned, these are all little games that skilled nursing providers, and the states they are located in, play in order to get more federal funding for Medicaid. They are all absurd and should be abolished.
Now, before you tar and feather me, hear me out. Skilled facilities with a high Medicare and private pay census do not like provider taxes because they don’t get the financial benefit from them that Medicaid facilities do.
UPL payments, while just in a few states, seem really stupid because you have to set up arrangements with local hospitals or others, changing the ownership structure between the real estate and the operations, all to get a higher Medicaid reimbursement rate. All games.
Enough. For one, if the federal government is going to pay a higher amount anyway, then do it above board and don’t make providers and states waste their time with all these taxes and other maneuvers to have Washington pay more.
The federal government needs to make a change, and the first step is to determine what all these various maneuvers is costing Medicaid today, and just add it to their Medicaid payment already going to the states.
Second, it is time for CMS to belly up to the bar and admit Medicaid is not cutting it from a cost-covering perspective. Yes, Medicare is covering some of the shortfall, but that is no way to run a business.
It is time for the Feds to start paying the full share of the cost, and that includes the states as well, which love these games because it means less out of their own budgets. If we have a prayer of taking care of the boomers in 10 years, a structural change needs to be made to how Medicaid is paid to providers, and the time to start on that is now.
Just passing the Medicaid Fiscal Accountability Regulation (MFAR) proposed last November by CMS does not do it. But maybe, just maybe, it will get some heads together to finally fix Medicaid payments to SNFs before the problem gets too big to rationally solve.
Yeah, and have I got a bridge to sell you.