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Lost fight with Medicare to cost nursing homes $3.87 billion

WASHINGTON — Nursing homes' lost lobbying battle with Medicare will cost the industry $3.87 billion as the health program tries to recover overpayments it says it made to companies such as Kindred Healthcare and Sun Healthcare Group. Both companies have a presence in the Tampa Bay area.

The 11.1 percent Medicare rate cut for next year is meant to stop overbilling by for-profit homes. The change follows Medicare's finding that, under a new payment system put into place this year, the companies drove up reimbursements for patients.

The new rates "correct for an unintended spike in payment levels and better align Medicare payments with costs," according to a statement by Medicare, the U.S. health plan for the elderly and the disabled. The American Health Care Association, the industry's Washington lobbying group, said Medicare is moving too fast and that the sudden cuts won't give nursing homes time to adjust.

The program "makes reductions beyond what is necessary," said Mark Parkinson, the association's chief executive. "This drastic reduction will be especially challenging for skilled nursing facilities to manage."

Nursing homes say Medicare has gone too far.

"We are appalled," said Larry Minnix, chief executive of Leading Age, the Washington lobbying group for not-for-profit homes.

Kindred Healthcare has locations in Tampa and St. Petersburg. Sun Healthcare Group operates facilities in Clearwater, New Port Richey, Oldsmar and Palm Harbor.

Lost fight with Medicare to cost nursing homes $3.87 billion 08/01/11 [Last modified: Monday, August 1, 2011 10:25pm]
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