Little Effect From Legislative Change Permitting Asset Revaluation After Sales

HRD-88-65: Published: Apr 8, 1988. Publicly Released: Apr 8, 1988.

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Pursuant to a legislative requirement, GAO determined: (1) whether states changed their Medicaid reimbursement policies to allow revaluation of sold nursing home assets; and (2) the cost effects of any such changes.

GAO found that: (1) all states except Alaska provided assurance that ownership changes would not increase Medicaid capital payments; (2) only Alabama, Alaska, and Virginia changed their payment methods regarding asset revaluation; (3) state officials believed that the cost impact of program changes would be minimal because relatively few nursing homes would change hands; (4) many states did not make changes because they believed that changes would affect state program costs; and (5) if additional states changed their revaluation policies, Medicaid costs would be substantially affected.

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