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Bondon looks to adjust reimbursement rates for nursing homes that invest in improvements


JEFFERSON CITY, Mo. — Long-term care facilities that invest in upgrades to their facility could apply for an update in their Medicaid reimbursement rate, under a proposal under consideration in the Missouri General Assembly.

HB 600, sponsored by Rep. Jack Bondon, looks to update Medicaid per diem reimbursement rates in a way to encourage facilities to invest in improvements. Sen. Mike Cunningham has a bill, SB 11, that would institute the same mechanism.

I can say without a shadow of a doubt, there is no change that can be made that would have a greater impact on the overall quality of Missouri’s senior care system,” said Bondon.

He noted that the current way Missouri’s law is written actually dissuades care facilities from investing in their own facility, which in turn limits the quality of care for seniors.

In the Show-Me State, when a care facility becomes operational, their Medicaid reimbursement is set and it stays at that rate. With no mechanism set for rebasement on average for facilities, Medicaid reimbursements are $20 per day per person unfunded compared to actual costs, according to one witness.

Nikki Strong, Executive Director of the Missouri Health Care Association, said that the average per diem Medicaid reimbursement is $162, the lowest in the country. Some are more than that while some are much lower.

They have previously asked for a full resetting of the Medicaid rates, with current costs, which would probably cost the state about $66 million to do. About 10 percent of the rate reimbursements in funded by general revenue.

What Bondon is proposing would cost the state up to $5.1 million in Fiscal Year 2022. But he noted there is no way to take into account possible costs savings. Strong noted the economic development would generate income for the state, too.  

“My proposal creates a system for preapproval of an investment into direct patient care and upon validated completion of the improvements, the facility would receive an increase in their patient daily care rate,” said Bondon.

This mechanism for facilities would recoup their investment cost would help address several problems he noted.

He pointed to an area in Missouri that had five four-star facilities with multiple open beds. Those facilities reimbursement rate averaged $140 per day per person. A new facility was built in the area with a $175 per day per person reimbursement rate. If those older facilities had a way to update their rates and invest in their facilities — and followed through with the investment — the new facility may not have had any demand.

Fewer new facilities would save the state money and help address the overbedding issue in the state.

“This is a must do if we are going to correct our senior care problem that we have in our state,” said Bondon.

No one testified against the bill, but Rep. Jim Neely did express trepidation to the proposal.

“I couldn’t go open a nursing home today because of certificates of need, there is where the problem is,” said Neely.