Tuesday, July 12, 2011

Uncle Sam's $2 Billion Gift to Nursing Homes

The Center for Medicare and Medicaid changed a reimbursement rule regarding physical therapy in nursing homes.  As a result, nursing homes received an extra $2.1 billion in reimbursement for the first six months of the year. 

Beneficiaries of this change include for-profit nursing homes with PEU ties:

ManorCare (Carlyle Group affiliate)
Golden Living (Fillmore Capital Partners)
Genesis Healthcare (owned by Formation Capital and JER Partners)
LifeCare Centers of America (privately held)
Kindred Healthcare (with a Bain Capital board member)
Sun Healthcare (two PEU board members, RFE Investment Partners & Tri-River Capital
This group is lobbying to keep the extra money flowing until the end of the year.  Kindred showed how they changed rehab services delivery, more individual therapy sessions for more time.

Here are the health care giveaways:
$5 billion in Early Retirement Reimbursement Program
$1 billion in Medical Innovation grants
$2.1 billion in long term care rehab reimbursement
As Carlyle co-founder David Rubenstein said at the Milken Global Conference. 
Health care costs are not going down.  Guess where Carlyle is putting their money?  They're PPACA-ing it in.

Update 9-10-11:  Carlyle's ManorCare is laying off hundreds of workers.