Every chance he gets, John Kasich lets it be known he does not care whose ox is gored by his efforts to transform Ohio’s Medicaid system and funding focus. Facing down Ohio’s nursing-home operators, who have been masters at getting favorable treatment in the Statehouse, is a particular point of pride for the governor. Imagine then how irked he must be that House Republicans are siding with the industry.
The House approved a budget review bill Wednesday that included a provision Kasich had not proposed: routing $30 million to nursing facilities. The funds would go into a pool that covers incentive payments to nursing facilities that meet a number of quality measures. No surprise, Kasich’s response to the House revision has been sharp: “That’s not going to happen.”
And it shouldn’t. But not, as the governor contends, because legislators have smelled new money and are embarking on runaway spending. It shouldn’t happen because directing the funds to nursing homes would undercut a carefully structured process to realign Medicaid payments and services to the changing needs of clients.
Ohio historically has spent the bulk of its long-term care budget on nursing-home care. The Kasich administration is pressing forward with reforms that allow state spending to reflect the popularity of different options in the continuum of long-term care. A critical part of the reform process included in the current budget bill, House Bill 153, is a unified budget for long-term care, which offers the necessary flexibility to direct more funding where demand is rising, say, in home-based care.
Another reform element is a revised framework for incentive payments, which aims to spur higher efficiency and quality of services in nursing facilities. It makes 9.7 percent of the base rate contingent on the facilities meeting certain quality measures, high performers rewarded with bonus payments from unspent funds.
Ohio is underspending appropriations in the current budget for nursing facilities. Administration officials contend the unspent funds properly belong in the unified budget, where they would boost the capacity to support other long-term care options. The House voted instead to direct the unspent funds into incentive payments for nursing facilities that meet more of the quality measures.
In essence, this is a budget fight over priorities in allocating unspent funds. Long-term care represents a large chunk of state spending that policymakers long have struggled to control. Without question, the intent of the House action is in line with the policy to reward quality and efficiency. Still, it is crucial to keep in sight the larger purpose of a unified long-term care budget: To align state spending with client needs in long-term care, correcting funding priorities that for far too long were skewed to care in nursing facilities.