One nursing home reportedly was close to closing its doors but through last-minute interventions was spared.

Legislators worked this past week to address the issue through two different approaches &045; an increase in the cigarette tax and a supplemental appropriations bill that would increase Medicaid funding.

Jordan reported that the House passed House Bill 716 last week, which would increase the cigarette tax from 16.5 cents to 33 cents per pack. Estimates are that the tax will generate $57.9 million, part of which is earmarked for Medicaid. The bill is pending committee action in the Senate Finance and Taxation General Fund Committee.

Also pending is House Bill 403, a supplemental appropriations bill that will help fund Medicaid for the remainder of FY 2004. Medicaid’s estimated shortfall &045; combined state and federal &045; for 2004 remains $220 million and $624 million for FY 2005.

Another matter relating to Alabama’s nursing home industry is a proposal originating in the House to raise the nursing home bed tax from $1,200 to $1,900 per bed. Estimates are that the bill will raise approximately $13 million state dollars each year, earmarked for the state share of Medicaid. The House passed the bill and it has gone to the Senate, where it was referred to the Senate Finance and Taxation General Fund Committee.

That measure is a two-edged sword for nursing home operators. While it would increase state revenues for Medicaid, and produce the $2.60 matching federal for every state dollar, it would be an added expense for nursing homes.

The nursing home association and owners have fought the measure. The governor’s representatives originally proposed an increase to $2,600, which was reduced to the $1,900 figure in committee. The nursing home industry is willing to live with the compromise for now, believing it best that could be obtained. Jordan said, &uot;The vote on the nursing home bed tax – the nursing home association supported the $1,900 level – was an indication that legislators realize the importance of Medicaid to all Alabamians.&uot;

Dallas County is currently receiving $46.5 million annually from Medicaid, according to figures released by the association.

Of the proposal to increase revenues for Medicaid through an increase in the cigarette tax and direct supplemental funding, Jordan had this to say: &uot;It seems that there is a changing sentiment among staunchly anti-tax forces that if there is no new revenue for Alabama Medicaid, real harm will be done to nursing home residents, doctors’ patients and kids. Now even some of the most vocal critics of any increase in taxes for any purpose are saying it’s OK to increase taxes for a specific (desirable) purpose.&uot;

Still the measures face hurdles – passage by the Senate and a signature by the governor.

Jordan pointed out that the current legislative session ends May 17 and while nursing home advocates are hopeful, no outcome is guaranteed, he said.

For further information and updates, go to the association’s Web site www.anha.org or call (334) 271-6214.