FOR IMMEDIATE RELEASE
May 25, 2006

- Some $91 million in funding cut; will threaten quality improvement
and harm nursing homes' financial stability -

Tallahassee - The steady gains in nursing home quality improvement and the financial stability and future viability of Florida's 700 nursing homes were greatly imperiled today with the veto of some $91 million in Medicaid funding previously approved by the 2006 Florida Legislature. The sudden and completely unexpected move by Governor Jeb Bush eliminated $65.5 million in additional funding directed at nursing homes most severely affected by the current Medicaid funding formula, and left in place the drastic $25.6 million in funding cuts made last year.

"We are completely baffled by the Governor's sudden turnabout," FHCA Executive Director Bill Phelan said. "Until today, Governor Bush had been a consistent supporter of adequate funding and quality improvement. What he has done threatens to undo all that. We are extremely disappointed in him today."

The 2006 Florida Legislature approved HB 5001, which restored $25.6 million in nursing home funding cut last year, and also provided a $65.5 million rate increase, which represented the partial re-basing of the indirect patient care component and the operating component of the nursing home Medicaid rate, which had not been re-based since 1993. Of the $91 million, some $53.6 million would have come from the federal government as part of its Medicaid "match."

"The additional funding also would have allowed our facilities to recover some of their losses due to greatly increased fuel, utility and property/casualty insurance costs," Phelan noted.

Left in place was the requirement for nursing homes to increase their daily minimum certified nursing assistant staffing to 2.9 hours per patient per day. While funds were provided to cover this particular staffing increase, Medicaid reimbursement has never been increased to adequately fund previous staffing increases, which all elder care advocates agree has been beneficial to improving the quality of care in Florida nursing homes.

"By cutting our lifeblood, Governor Bush has dealt a blow to the steady improvement in quality of care we have seen since approval of his landmark SB 1202 elder care legislation in 2001," Phelan said. "His vetoes threaten the financial stability of all nursing homes, which serve 71,000 frail elderly each day and are critical components of his Medicaid reform plans."

Phelan cited recent Agency for Health Care Administration and Florida TaxWatch studies that documented the chronic underfunding of nursing home care in the state. Nursing homes also continue to endure high-cost/low-coverage liability insurance, increasing and increasingly expensive government regulation and federal Medicare cuts that once were used to offset losses under Medicaid, Phelan said.

"Our disappointment is compounded by the fact that state law requires us to provide these services, but the state won't pay us for them," Phelan pointed out. "This will likely cause nursing homes everywhere to shift the cost to their private-pay patients, effectively imposing a ‘silent tax' on them. Nursing homes will also be forced to carefully limit their Medicaid-paid admissions, which will profoundly affect access to nursing home care by middle-class families everywhere in the state."

"The Governor is right to shoot down budget 'turkeys,' but this is money that goes to pay for the care of Florida's most frail citizens," Phelan said.

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