State medicaid gets $10 billion boost.

The long term care industry received a much needed economic boost from a bipartisan amendment to the Jobs and Growth Tax Relief Reconciliation Act, which President Bush signed into law.

The amendment ensures $10 billion in state relief to avert Medicaid cuts that would have bled dry the already fiscally ailing nursing home industry, leaving elderly and disabled residents without quality care.

Congress approved the tax bill earlier in May after heated debate. Sens. Susan Collins of Maine, Ben Nelson of Nebraska, Jay Rockefeller of West Virginia and Gordon Smith of Oregon were steadfast sponsors of the amendment, refusing to abandon state relief. President Bush approved the bill in late May.

"With state budget conditions worse than anytime since WW II, the economic stimulus plan passed by Congress will help ease the growing pressure to out Medicaid funding," said Dr. Charles Roadman, president of Washington, D.C.-based American Health Care Association and National Center for Assisted Living, a strong supporter of the amendment. "This will help protect the key health care jobs that ensure patients receive the quality care they need and deserve."

The legislation gives states considerable latitude about ways that Medicaid funds are used, a situation that both pleases and concerns policymakers.

"Passing state Medicaid relief is step one," said Roadman. "It's now time for our governors and state legislatures to ensure the aid is proportioned in a manner that protects our most vulnerable seniors' access to the quality care they need and deserve--whether they live in nursing homes, assisted living residences or facilities for the care of persons with mental retardation or developmental disabilities."

State policy makers throughout the country are keeping a close watch on fund dispersal.

The New York Association of Homes and Services for the Aging, long concerned about the fact that state reimbursement to New York nursing homes was $13 less per day than the cost of operations, supported the amendment. But now it's a waiting game as to how much good it will really do for the industry, according to Dan Heim, NYAHSA vice president for public policy.

"It's unclear at this point how the federal relief will be applied to our state budget," Heim said. "It's possible that the funding will simply be used to offset state spending on health care that was already planned through New York's Health Care Reform Act or its Medicaid program, rather than for initiatives aimed at assisting nursing homes financially. The added federal funding may take pressure off state government to see additional Medicaid cuts this year or next."