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 Long Term Care Spared Sequestration Ax, But Threat To Funding Remains

Long term care has been spared Washington’s ax—for now. Congress on Tuesday passed a compromise package that averts automatic cuts to a wide array of government programs for two months and permanently restores most of the tax rates of the George W. Bush era (except for those households that take home $450,000 or more per year).

The vote was a bit of a surprise because it came despite fierce resistance from conservative House Republicans.

Sequestration Averted For LTC Providers

The vote also gives some breathing space to long term care providers, who would have seen a precipitous drop in support under the so-called sequestration. American Health Care Association President and Chief Executive Officer Gov. Mark Parkinson said he was “grateful” that Congress put off the cuts for now.

“As we’ve shown throughout these negotiations, the long term and post-acute sectors stand at the brink of our own cliff, already reeling from deep cuts to Medicaid and Medicare throughout 2012,” he said in a public statement Wednesday.

That doesn’t mean that the funding danger has passed for long term care. Many conservatives, especially in the House, were angry about the deal and may look at the next two months as a chance to regroup. Many conservatives argue that the government’s spending habits are destabilizing and dangerous and want to rethink entitlement spending at every level.

Politics Remain

But the same political fault lines that had led many to bet against Tuesday’s vote are still grinding, observers say. In November’s elections, some 209 House Republicans won their seats by wide margins. The only danger to their incumbencies, therefore, comes from the right wing, political observers note.

That presents House Speaker John Boehner (R-Ohio) with a dedicated and disciplined phalanx of conservatives—potentially led by Boehner’s deputy, Eric Cantor (R-Va.)—that simply aren’t in the mood for compromise.

Meanwhile, despite the slim margin in the popular vote between President Obama and former Massachusetts Gov. Mitt Romney, the Democrats swept nearly every contested national seat.

Most observers say that by tailoring their Keynesian appeal specifically to Hispanics, African-Americans, women, and gays, the Democrats could create a permanent, national majority. Once-and-future Democratic stars such as Sen. Elizabeth Warren (D-Mass.) aren’t going to be any more receptive to broad spending cuts than their conservative counterparts would be to tax increases, experts say.

AHCA Will Fight Further Cuts

In his statement, Parkinson was conciliatory, but he made it clear that he and his allies will fight ferociously against any further cuts to their sector. “As Congress prepares for legislation to raise the debt ceiling, we stand ready to work with lawmakers to continue acknowledging cuts are something we cannot absorb in 2013,” he said.
“This profession needs a break to return as healthy contributors to economic growth while delivering quality-driven health care.”
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