This year’s historic election will send the nation’s first
African-American president to the White House and many new legislators to the
House and Senate. The incoming Administration and Congress face a number of
challenges at home and abroad. As we look
toward the 111th Congress and Inauguration Day, 2009, we anticipate
the following dynamics and developments:
President-elect Barack Obama:
- In his campaign, President-elect Obama extensively discussed health care reform, but his proposal did not include long-term care.
- He was a cosponsor of the CLASS Act, which closely approximated AAHSA’s long-term care financing reform structure, but his campaign did not seem to connect the bill to long-term care for elders.
- Obama also said that seniors should have long-term care choices not biased toward institutional care.
- President-elect Obama’s platform included the restoration of HUD operational public housing subsidies and support for Community Development Block Grants and the National Housing Trust Fund.
Both presidential candidates called for the following reforms in health care delivery, which could have ramifications for long-term care as well as for other aspects of the health care system:
- Consumer choice.
- Integration of services.
- Increased use of health information technology (HIT).
- Emphasis on wellness initiatives to prevent the development of chronic diseases and disabilities.
- Research and dissemination of information on best practices.
- Drug reimportation and faster approval of generics.
- Reimbursement aligned with quality of services.
Congressional composition:
Even before the election, it had become apparent that the 111th Congress would have more Democratic members in both the House and Senate than the 110th Congress. Because of their past majority, Republicans had more seats to defend in the Senate, 23 vacancies as opposed to 12 for the Democrats. More Republican House and Senate members had already left by the end
of the 110th Congress or announced that they would not run. Of the five senators who left their seats early or retired, all were Republicans. In the House, 25 Republicans left early or retired compared to three Democrats.
The key question in the Senate was whether the Democrats would gain a 60-seat majority in order to be able to cut off filibusters by the Republican minority. The threat of a filibuster, coupled with potential vetoes from President Bush, stymied many Democratic initiatives in the 110th Congress.
While the Democrats did enlarge their majority in the Senate, they appear to have fallen short of their 60-vote goal. They have picked up Republican seats in Colorado, New Hampshire, New Mexico, North Carolina and Virginia, leaving them now with 56 seats. Elections in Alaska, Minnesota and Oregon are still too close to call, but even if Democrats gained all three seats, they would still fall shy of the sixty-seat majority.
With the election of Sen. Obama, Democratic initiatives in Congress will have an easier road to enactment. There is no guarantee, however, that initiatives favored by either a Democratic president or a Democratic Congress will automatically find their way into law. The most prominent example of a Democratic president’s failure to get his initiative through a Congress dominated by his own party is the implosion of President Clinton’s health care reform proposal in the 103rd Congress, which enjoyed a Democratic-majority.
What this means for long-term care services:
Medicaid
- We are urging the present Congress to pass a second economic stimulus package including a temporary increase in the federal Medicaid match before final adjournment at the end of this year.
- Next April, the moratorium expires on Medicaid regulations that would cut federal Medicaid spending by almost $18 billion. These regulations include restrictions on the targeted case management that helps to ensure that beneficiaries receive the most appropriate services in the most appropriate setting. We will work with the new Congress and new Administration to overturn these regulations. Since the regulations were promulgated by a Republican Administration, they may be easier to overturn under President-elect Obama.
Medicare
Congress will have to pass another Medicare bill in 2009 because the physician payment relief passed this summer expires in December of next year.
With more Democrats in Congress, and the election of Sen. Obama, we will see efforts to address consumer issues related to Part D, including:
- Elimination of the doughnut hole in coverage.
- Reduction or elimination of the subsidy for Medicare Advantage plans.
- Federal government’s direct negotiation of drug prices with pharmaceutical companies.
- Equalization of nursing home residents’ co-payment protections with beneficiaries living in other settings, including assisted living.
For long-term care providers:
- Preservation of the full 2010 payment update for skilled nursing facilities, home health care providers and hospice.
- Extension of the therapy caps exceptions process.
In addition, we will be seeking opportunities to add our own proposals to the legislation:
- Reform of skilled nursing facility reimbursement to more accurately predict non-therapy ancillary costs, remove financial incentives for inappropriate therapy, and establish an outlier policy for extremely high-cost residents. Our proposal accords with MedPAC recommendations.
- Separate reporting of staffing expenditures on Medicare cost reports, as the first step toward payment reforms that would reward facilities that put more of their resources into staffing.
Workforce
President-elect Obama emphasized the need to train more nurses as a means of elevating health care quality generally.
We will continue to work for the Caring for an Aging America Act, which:
- Expands loan repayment programs for nurses who enter long-term care.
- Strengthens career ladder opportunities for direct care staff.
- Establishes a loan repayment program for physicians, physician assistants, advance practice nurses and social workers to gain gerontology/geriatric training.
We also will work to implement the recommendations of AAHSA’s workforce cabinet.
Home and Community-Based Services (HCBS):
Both presidential candidates discussed increased use of HCBS as a cost-effective alternative to nursing home care.
Several bills to increase access to HCBS under the Medicare and Medicaid programs were introduced in the current Congress. Although they never got to the House or Senate floor, we anticipate their reintroduction next year, and we will continue our strong support. The bills include:
- The Community Choice Act, to allow nursing home eligible individuals to access community-based attendant services under Medicaid.
- The Empowered at Home Act - to improve Medicaid coverage of adult day services and HCBS.
- Independence at Home Act – to establish a three-year Medicare demonstration project in 26 states for high cost patients suffering from multiple chronic conditions. The project’s aim would be to reduce the costs of chronic disease management.
We are working on legislation to prevent the Centers for Medicare and Medicaid Services (CMS) from cutting home health agencies’ Medicare reimbursement by 2.75 percent in 2009, and to assure that Congress rejects a freeze on the home health payment update. We also are urging Congress to provide a five-percent payment add-on for rural home health agencies.
We will continue working to overturn CMS’s plan to phase out the budget neutrality adjustment factor for hospice providers, and to assure that hospice providers receive the market basket payment update.
Next spring also will see new fiscal 2009 appropriations legislation, as the present continuing resolution expires in March. We will be advocating for increased resources for the Older Americans Act programs that fund nutrition, transportation, and other vital services for elders living in the community.
Housing
With the fiscal 2009 continuing resolution expiring in March, we will renew our advocacy for increased resources for senior housing, including:
- Increased funding for production of new units.
- Adequate Section 8 funding to ensure full payment for entire fiscal year on existing contracts.
- More resources for service coordinators who help tenants remain in their apartments with supportive services.
We will seek reintroduction of our signature senior housing reform legislation to increase available funding for services, assist providers in preservation efforts, and make assisted living possible for low-income seniors.
We also will pursue any new models of housing with services models proposed by our Affordable Housing Finance Cabinet.
Long-Term Care Financing Reform:
We will continue
pursuing our proposal for implementation of our long-term care
financing solution. We will train more ambassadors and encourage more
public discussion of the need for long-term care financing reform that
provides consumer choice and equity of benefits while encouraging
financial responsibility.
We anticipate reintroduction of the CLASS Act, which incorporates most of the recommendations of AAHSA’s Finance Cabinet.
We
are working in coalition with other stakeholder groups to gain
consideration for our proposal. We will build on the joint principles
signed by the Leadership Council of Aging Organizations and the
Consortium of Citizens with Disabilities, which put over 100 groups
representing elders, people with disabilities, and those who serve them
behind the kinds of reform recommended by the AAHSA Finance Cabinet.
Legislation favored by consumers and by labor is likely to have an
easier road in the 111th Congress. Measures with improved chances of
consideration and passage include:
- A ban on pre-dispute arbitration
agreements in assisted living or nursing homes. The House and Senate
Judiciary Committees approved the legislation in the 110th Congress,
but it never came to a vote in either house. Along with many business
and other organizations, AAHSA opposes.
- A federal
criminal background check requirement for long-term care workers. We
have worked with the bill’s sponsors to ensure protections for
long-term care providers.
- The Nursing Home Transparency
and Improvement Act. We support provisions of this bill which would
require increased reporting and transparency on nursing home ownership,
but we oppose sections of the current bill that would increase survey
penalties and authorize them to be held in escrow pending appeal.
- Legislation to allow
unions to organize workplaces through postcards or petitions as
alternatives to secret ballot elections. This bill was passed by the
House in the 110th Congress, but was blocked by Republicans in the
Senate. AAHSA opposes.
- The
Elder Justice Act, which establishes bureaucratic structures and grants
for better federal monitoring and prevention of abuse against elders in
the community as well as in nursing homes. The bill was approved by
Senate Finance Committee and House Judiciary Committee in the 110th
Congress, but never came to a floor vote in either house. We have
worked with sponsors to ensure protections for long-term care providers.
Effect of the Wall Street meltdown
- The new President and new Congress will face a historically high deficit that may approach $1 trillion for 2009.
- The
economy replaced healthcare as a top concern among voters during the
campaign, and we would expect to see legislation early next year to
combat the recession. Congress will weigh proposals for new spending
according to their potential for stimulating the economy.
Regulatory issues/nursing homes:
- We will work to implement the recommendations of AAHSA’s Oversight Reform cabinet, especially the call for a new study by the Institutes of Medicine on the effectiveness of the current oversight system.
- An increase in the proportion of Democrats in Congress will pose greater challenges to legislation to modify provisions of OBRA 87.
- A Democratic administration under President-elect Obama may be more difficult to persuade to make administrative changes in the current oversight system.
Regulatory issues/assisted living:
- We have heard from the majority staff of the Senate Special Committee on Aging that federal regulation of assisted living is a case of not if, but when. With more Democrats in the Senate, there may be a renewed push for federal protections for assisted living residents. We favor continued quality assurance through our participation in the Center for Excellence in Assisted Living.
Technology
- Both presidential candidates called for increased use of health information technology (HIT) as a means of making the health care system more efficient and bringing down health care costs. The Senate Finance Committee already held one hearing on this issue and we anticipate continued focus on health IT, especially if Congress takes up health reform legislation.
- We will continue to participate in the working group that is developing standards for electronic medical records so that all providers’ systems will be able to communicate with each other.
- We also will pursue our amendment added to health IT legislation late in the current Congress to require a federal study of the application of technology to aging services.
Tax-exempt status issues:
- We anticipate that state and local governments facing growing budget deficits will continue to challenge the tax exempt status of not-for-profit long-term care providers.
- We also expect that the Senate Finance Committee will continue to keep a close eye on not-for-profit health care organizations’ provision of charitable care. This issue could become intertwined with general health care reform legislation (as happened in 1994).