Medicare Cuts Could Spark National Trend of Skilled Nursing Layoffs

Nearly 3,000 nursing home jobs have already been lost in Ohio due to the squeeze created by an 11.1% reduction in Medicare reimbursement rates, and the Alliance for Quality Nursing Home Care recently said this represents the “leading edge of a national trend” that could affect all skilled nursing patients as direct care staff is reduced.

The Medicare cuts went into effect on Oct. 1, and reduces Medicare funding to nursing homes by $79 billion in the next decade on a national basis, according to an Avalere Health study.

However, the impact of these cuts could be “significantly alleviated” by phasing them in over three years, according to the Alliance.

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“A gradual phase-in of the federal regulation—which has been done in the past for other provider sectors—can help alleviate a worsening direct care staff layoff crisis that is now a documented fact in Ohio,” said Alan Rosenbloom, president of the Alliance, in a statement. “We respectfully urge Congress to pursue a phase-in of the regulation, and we would be pleased to work with lawmakers to help achieve this logical, fair and responsible policy recourse before Congress adjourns for the year.”

Nationally, nursing homes plan to lay off approximately 20,000 workers in response to the federally regulated cuts, according to a survey by Avalere Health. Additionally, facilities plan to cancel approximately 400 facility expansions or renovations that could have created at least 20,000 new jobs, and the Alliance found that one-third of companies in the survey plan to lay off an average of about 6% of their staff.

“States such as Ohio and Florida—where state Medicaid funding for nursing homes has already been reduced even before the new Medicare regulation went into effect—are clearly experiencing significant facility instability to the detriment of patient care and local jobs,” Rosenbloom said. “We are especially alarmed by the reporting in Ohio that finds approximately 80% of the 2,800 losing their job in facilities provide direct care to residents, according to the news reports.”

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Nationwide, more than 70% of all patients in nursing homes rely on Medicare and Medicaid funds, according to the Alliance, and further cuts to Medicare could negatively impact residents and prove “disastrous” to facilities, local economies, and caregiver jobs.

Written by Alyssa Gerace

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