The nursing home industry is scaring residents, telling them that health care reform will lead to poorer quality of care and the loss of the staff who provide them with essential care each day. "This outrageous misinformation campaign must stop," said Center for Medicare Advocacy Senior Policy Attorney Toby S. Edelman.

Year after year multiple reports by the Government Accountability Office and the Medicare Payment Advisory Commission (MedPAC) have shown that the Medicare program overpays skilled nursing facilities by billions of dollars. For seven years in a row, MedPAC reported that aggregate profit margins for freestanding nursing facilities exceeded 10%. In 2007, the profit margin was 14.5%. Worse yet, despite enormous overpayments, the Centers for Medicare & Medicaid Services documents that nursing facilities have not increased their staffing. Where do these billions of dollars go? "The overpayments go to profits to corporate nursing homes and to excessive executive compensation, not to the care and services needed by residents," said Ms. Edelman.

The Center for Medicare Advocacy has called on Department of Health and Human Services Secretary Kathleen Sebelius to put an end to the nursing home industry's misinformation campaign, just as the Department acted correctly and quickly last week to halt the misinformation campaign by the Medicare Advantage industry.

The Center for Medicare Advocacy also supports changes to the Medicare reimbursement system contained in America's Affordable Health Choices Act of 2009. These changes would correct fraud and abuse in reimbursement, while recognizing that Medicare rates need to be increased for the small number of nursing home residents with special care needs, including those who use ventilators.

Ms Edelman is available for comment.