Medicare cuts nursing home payments by 11 percent

AP News
Posted: Jul 29, 2011 5:53 PM
Medicare cuts nursing home payments by 11 percent

Medicare says it will cut payments to nursing homes to correct for an unintended windfall this year, and the industry is warning that quality will be compromised.

Officials announced the 11 percent cut Friday, along with other changes meant to tamp down on physical therapy costs. Medicare covers rehabilitation in nursing homes, not long-term stays.

Officials insisted the cut is fair because it removes an unintended spike in payments this year due to a formula glitch. Medicare chief Don Berwick says the Obama administration remains committed to high-quality care.

But Lauren Shaham, a spokeswoman for nonprofit homes, says the cut is so large that it will make it "tremendously hard" to keep up quality service. The new lower payment rates take effect Oct. 1