State, nursing homes reach agreement in Medicaid lawsuit

PROVIDENCE, R.I. (WPRI) -- With millions on the line, Rhode Island's Executive Office of Health and Human Services has reached an agreement with 59 nursing homes to settle a lawsuit challenging Medicaid rate cuts.

The agreement provides nursing homes with a 1.5% increase for Medicaid reimbursements beginning July 1, 2018, and another 1% increase beginning October 1, 2018, through the state budget.

Rhode Island Health Care Association President and CEO Virginia Burke, who represents many nursing homes at the State House, estimated the settlement will net the nursing homes about $9 million going forward.

"We are very pleased that the parties were able to reach and fair and reasonable settlement in such a short time," Burke told Eyewitness News. "It was certainly unexpected the way the issue arose, but all's well that ends well."

In a statement to Eyewitness News, Gov. Gina Raimondo said she is also pleased with the tentative settlement.

"This settlement will give clarity to budget writers in future years and provide nursing homes with a modest rate increase this year," Raimondo said. "I’m grateful that the legislature, administration and nursing homes were able to work together to reach an agreement that is fair to taxpayers and providers."

Nursing homes were originally awarded up to $24 million through June 2019, and the state bungled its chance to challenge the ruling when a now-former state attorney missed the appeal deadline. The attorney resigned in the wake of the case. 

The state budget House Speaker Nicholas Mattiello released last week would have cut the nursing homes’ rates by 8.5% to make up for money won in the lawsuit.

The settlement will be official when the Rhode Island state budget, which includes the provisions of the agreement, is signed into law.

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