Nursing homes await word on Medicaid proposal

Tuesday, Dec. 31, 2002 | 9:53 a.m.

CARSON CITY -- It will probably be spring before Gov. Kenny Guinn's administration decides whether to back a plan by the nursing home industry to raise its own taxes in order to draw more Medicaid money, state Human Resources Director Mike Willden said.

Willden said the legality of the plan has to be analyzed before any decision is made and the plan won't be included in Guinn's budget to be presented to the Legislature on Jan. 20.

The Nevada Health Care Association, which represents nursing homes, is drafting a bill to impose a tax of up to 6 percent on the industry's gross receipts. The money collected would then be matched with federal Medicaid funds and returned to the homes in higher payments for Medicaid patients.

Association Executive Director Charles Perry said the nursing homes are underpaid an estimated $12 million a year under a state formula for Medicaid patients. The state is implementing a new formula on which it is paying homes $121 per patient per day, but it should pay the homes $142 per day per patient, Perry said.

Since the state doesn't have the money to make up the difference, the nursing home industry came up with the tax. Assemblyman David Goldwater, D-Las Vegas, is expected to draft a bill that includes the tax.

About 65 percent of the patients in Nevada nursing homes are covered by Medicaid, said Joe Lubarsky, a consultant to the health care association.

A 6 percent gross receipts tax would yield about $10 million to $11 million a year, and that, in turn, would produce $10 million to $11 million from the federal government, Lubarsky said.

Seventeen states now use this approach and nearly a dozen more are considering similar legislation, he said.

Willden said, however, that the federal government still has questions about a previous provider tax imposed by the state on hospitals. He said the government has not resolved whether the state must pay some money back to the federal government, and it may be spring before those issues are settled. One drawback of the latest provider tax proposal is that a nursing home with only a small number of Medicaid patients would receive less than its taxes would generate because any tax on gross revenues would have to be imposed across the board on all revenues collected.

Lubarsky said some states have tried to give a rebate to those homes but the federal government rejected those plans.

Another issue is whether the state would take a share of the increased Medicaid money. Perry said the full amount should be returned to the homes.