The Centers for Medicare & Medicaid Services should withdraw the proposed Medicaid Fiscal Accountability Regulation because, if finalized, it would jeopardize access to care and “cripple” Medicaid financing in several states, leaders of the American Health Care Association / National Center for Assisted Living and the American Hospital Association said Thursday.
The statement comes as the Feb. 1 deadline nears for providers to submit comments on the proposal.
MFAR, which CMS said it announced in November to increase transparency in Medicaid payment processes and eliminate suspect practices, effectively proposes new Medicaid taxes by disallowing long-standing provider tax exemptions and discounts for some continuing care retirement communities, also known as life plan communities and some other healthcare entities.
Also under the rule, new requirements would be established for states to report provider-level information on Medicaid supplemental payments. Upper Payment Limit demonstrations and supplemental payments would be revised, and new requirements would determine how UPLs can be calculated and which data sources could be used. The proposed regulation also would limit the amount of time a state could have supplemental payment policies without federal review.
“Enacting this proposed rule would cut up to $50 billion nationally from the Medicaid program annually, further crippling Medicaid financing in many states and jeopardizing access to care for the 75 million Americans who rely on the program as their primary source of health coverage,” AHCA/NCAL President and CEO Mark Parkinson and AHA President and CEO Rick Pollack said Thursday in a jointly issued statement. AHCA/NCAL also sent a 21-page letter to CMS Administrator Seema Verma outlining concerns.
Although in long-term care the regulation most directly would affect skilled nursing, residents in other parts of CCRCs could be affected if communities increased entrance or monthly fees in an effort to offset the new taxes, LeadingAge previously said. The exact cost of the new taxes would vary by state and by community, but the amount “easily” could reach six or seven figures each year, according to the organization. CCRCs might even decide to close their nursing centers, LeadingAge said.
“CMS has provided little to no analysis to justify these policy changes, nor has the agency assessed the impact on providers and the patients they serve,” Parkinson and Pollack said Thursday. “Many of the proposed changes would also violate federal laws, including the current Medicaid statute. The AHA and AHCA request that the agency withdraw the proposed rule in its entirety.”
CCRCs in at least 18 states would be affected, according to a LeadingAge analysis, because those states currently exempt the retirement communities from the tax program or levy a discounted tax on them.
Editor’s Note: Read the Jan. 30 letter LeadingAge sent to CMS here.