Researchers at the University of California released an evaluation of impact of California's Long Term Care Reimbursement Act of 2004 (AB 1629) that showed that Medi-Cal costs for nursing homes increased by $590 million between 2004 and 2006 without improvements in quality or access to care. Total costs for California's free-standing nursing homes were $6.6 billion in 2006. The Long Term Care Reimbursement Act was designed to improve the quality of nursing home care by increasing Medi-Cal reimbursement rates, using a payment system based on actual costs of care for each facility with certain costs ceilings. Implemented in 2004-05, the system raised Medi-Cal rates from $124 per day in 2004 to $152 per day in 2006. The report showed that access for Medi-Cal residents, quality of care in nursing homes did not improve between 2004 and 2006. Expenditures for administrative costs increased and net income margins improved over the period.

Evaluation of California's Long Term Care Reimbursement Act
and Associated charts