Washington

Smarting from significant Medicare cuts, five of the nation's largest nursing home chains have filed for bankruptcy. But even as industry advocates warn that the long-term care segment of the health care market could collapse, government officials insist that Medicare nursing home payments are sufficient.

"We believe that Medicare [skilled nursing facility] payments are likely to provide sufficient - and in some cases, even generous - compensation for services furnished to Medicare beneficiaries," Laura Dummit, associate director of health financing and public health issues for the General Accounting Office, told the Senate Special Committee on Aging recently.

Charles Roadman II, M.D., president of the American Health Care Association, told the committee the other side of the story. "Bankruptcies among skilled nursing facilities have reached an alarming figure," he said. "This is just the tip of the iceberg. Our long-term care community is facing a squeeze with the real potential for absolute collapse."

But officials, including Sen. Charles Grassley, R-Iowa, who chairs the committee, attributed the bankruptcies to poor business decisions and "a vision of ever-growing government largess."

To which Roadman countered, "Without adequate reimbursement to meet operating and capital requirements, providers cannot survive."

Which side is right?

Only time will tell.