Kansas Health Institute | Information For Policy Makers. Health for Kansans.

TOPEKA — The Kansas House, following the Senate, passed the nursing provider tax bill late this afternoon. The vote was 86-33.

The bill now goes to the Gov. Mark Parkinson, who supports the initiative and is expected to sign it.

“I’m really pleased the House and Senate saw the wisdom of bringing dollars into an industry that has been underpaid for services for years,” said Rep. Bob Bethell, R-Alden. “This is going to raise the quality of care to a level that has not been experienced in the past.”

The bill uses a tax on licensed nursing home beds to generate about $30 million which, in turn, will be used to draw down $56 million in additional federal Medicaid funding.

The $86 million will be returned to the nursing homes based on the number of Medicaid residents in their care. The more Medicaid residents a home has in its care, the more money it would receive.

All but 20 of the state’s 346 nursing homes are expected to benefit or break even. The average gain: $163,000.

Of the 20 homes that lose, the average loss is expected to be about $42,800.

Typically, homes that lose have few or no Medicaid residents.

Bethell, as chairman of the House Committee on Aging and Long-term Care, spent several weeks shepherding Senate Substitute for Senate Substitute for Substitute House Bill 2320 through the House. He did not speak in favor of the bill on Tuesday. Instead, it was carried by Rep. Jeff Witham, R-Garden City.

Floor debate lasted about 30 minutes. The measure was the last bill voted on prior to the motion to adjourn.

For years, the state’s for-profit nursing homes, represented by the Kansas Health Care Association, have supported the provider tax, saying there’s no other way to generate the funding they need to provide quality care for residents whose stays are paid by Medicaid.

The state’s nonprofit nursing homes, represented by the Kansas Association of Homes and Services for the Aging (KAHSA), opposed the bill, calling it a “granny tax” that would force homes to raise rates for their private-pay residents.

The non-profit group began tempering its opposition after an April 29 meeting with the governor.

Still, several House members spoke against the bill.

“I have a nursing home in my district that must be one of the 20 losers because they asked me to vote against this bill,” said Rep. Joe McLeland, R-Wichita. “The administrator asked me, ‘Why are you taxing me to raise money to send to my competitors?’

“He’s right, that’s what this bill does,” McLeland said. “If we’re going to do something, we ought to do it in a way that everybody wins.”

Earlier in the year, Kansas Department on Aging officials said Medicaid regulations require a mix of winners and losers.

Rep. Marc Rhoades, R-Newton, said the bill would increase the state’s dependence on federal aid.

“I’m going to vote against this bill so that in a couple years I can remind you what a stupid idea this was,” Rhoades said, noting that the nursing homes in his district opposed the tax.

Rep. Melvin Neufeld, R-Ingalls, argued for the bill, saying it would offset the 10 percent cut in Medicaid reimbursement ordered by the governor in January and improve quality of care by requiring homes to spend the new revenue on staffing, a perpetual issue for the industry.

Neufled warned that if the bill didn’t pass, many nursing homes would have no way to offset their Medicaid losses and would be forced to raise their private-pay residents rates.

“This bill allows us to prevent those increases,” Neufeld said.

If the governor signs the bill as expected, it will take effect upon it appearance in the Kansas Register, which is published on Thursdays.