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1992.08.28 :  Nursing Home Deposits

Contact: Bob Hardy (202) 690-6145
August 28, 1992

       Nursing homes can be dropped from the Medicare and
Medicaid programs if they require the elderly, disabled and poor
enrolled in those programs to pay deposits for admission, the
acting administrator of the Health Care Financing Administration
warned today.

       William Toby Jr. sent a letter reminding nursing home
administrators that federal law and regulations prohibit them
from requiring deposits from Medicare and Medicaid enrollees for
care that is covered by payments from the federal programs.

       Specifically addressing complaints about charges imposed
on Medicare beneficiaries, he told the nursing home
administrators: "Under your provider agreement, you may not
require a beneficiary to pay a deposit as a condition of
admission -- unless it is clear that the stay will not be covered
by Medicare."

    Providers can be terminated if they do not comply. 

    Toby reminded the nursing home officers that policies
governing charges applicable to Medicare beneficiaries are set forth
in sections of the Code of Federal Regulations and HCFA's Skilled
Nursing Facility Manual.

    Nursing homes may require deposits for individual comfort and
convenience items, such as rental television sets, which are not
covered by Medicare. But, nursing homes may not require Medicare    
beneficiaries to request such noncovered items as a condition for
admission or continued stay.

    Medicare helps to pay for skilled nursing facility care for
medically necessary therapy and rehabilitation after hospital
inpatient stays. The program does not pay for long-term care in
nursing facilities.

    Approximately 800,000 Medicare beneficiaries and 1.6 million
Medicaid recipients received care in nursing facilities in fiscal
year 
1991.


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    Medicaid regulations on long-term care specify that nursing
homes are barred from requiring recipients to pay deposits as a
condition for admission. Medicaid, a federal-state program for the
poor, covers long-term care.

    The Health Care Financing Administration administers the
Medicare program for the elderly and disabled and the federal
portion of the Medicaid program for the poor, for which matching
funds are paid to the states. HCFA will spend an estimated $204.3
billion in fiscal year 1992 to finance health care services for more
than 60 million people, or nearly one in four Americans.
 

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