Tax would hurt seniors, not help them

March 13, 2010

Many nursing facilities in the state do not agree with the position taken by Joseph DeMattos Jr. of the Health Facilities Association of Maryland in the March 7 Article "Tax Us to Help Us." LifeSpan Network, a senior care provider association consisting mainly of not-for-profit and small, family operated nursing facilities, believes that the negative long-term effects of increasing the quality assessment outweigh any short-term gain. Mr. DeMattos was correct when he called the "quality assessment" a tax -- a tax gimmick. Because while the nursing facility receives the tax bill, it is the residents who pay their own nursing bills rather than rely on state assistance who ultimately pay the price. This is not a small sacrifice.

I realize that some nursing facilities may support this proposal because they fear additional budget cuts, which would be devastating for our residents. In making decisions during this difficult economic time, the state must ask, "what needs must be addressed today and what can wait until tomorrow?" I believe that the health care needs of our state's frail and vulnerable elderly must come first. There are no second chances in health care, and you cannot do tomorrow for them what you should be doing today. Quality of care, quality of life, dignity and respect should be the cornerstone of care, and the state should ensure that funding supports these cornerstones without relying on funding gimmicks.

The tax works by assessing nursing home beds a 2 percent tax. The state then receives a federal match on the revenues collected, which is typically passed down to the nursing facilities. The benefit to the state is that it can supplant state dollars with federal funds. However, a nursing facility only receives the added reimbursement on beds on state assistance. Beds that are paid for privately by a resident are assessed the tax but receive no enhanced funding. Hence, this "funding gimmick" is a redistribution of dollars from private-pay residents to those on state assistance. This year the state is not only trying to increase the tax to 4 percent but is also proposing to divert monies directly from it into the general fund to offset its budget deficit.

Under this proposal, one-third of the nursing facilities receiving this increased tax bill will see a net loss in their revenue, meaning that they will have fewer dollars to provide care. Why? Because they care for too many private-pay residents. When first implemented, the state made a commitment to mitigate the number of nursing facilities that would experience a net loss by capping the tax at 2 percent. This proposal, done only to supply additional monies to the general fund, reverses this commitment. Ironically, the gains realized from the original 2 percent tax have been eroded after years of state budget cuts, and the 2 percent has become more of a liability for many nursing facilities. A tax never goes away, and a 4 percent tax would be no different.

I and many others do not believe that legislators should be endorsing a proposal that would take money away from a third of the state's nursing facilities, especially when those who will ultimately be paying for it are those residents who have saved their money and are paying for their own care. Lastly, it should never be said that this tax helps those most in need. Health care needs do not differentiate between payer sources. All nursing home residents deserve quality care. All nursing facilities have been hurt by state budget cuts and the downturn in the economy. Once the tax is raised to 4 percent, nursing facilities and their residents will ultimately bear this burden, and most nursing facilities will need to pass this tax to private-pay residents. Legislators should vote no to this increase. It is bad for nursing facilities and bad for our elderly.

Izzy Firth, Columbia

The writer is president of Mid-Atlantic LifeSpan.

Baltimore Sun Articles
Please note the green-lined linked article text has been applied commercially without any involvement from our newsroom editors, reporters or any other editorial staff.