Budget Fact:
In fiscal year 2000-01, the state spent $8,940,400 to give grants to assist 3,694 low-income nursing home residents with paying for nursing home care. This year, the Nursing Home Resident Grant Assistance Program will provide ZERO grants and spend no money.

But the tax that was created to fund it remains in effect - and will raise an estimated $102.5 million this year. The nursing home bed tax - $2,225 per bed per year - raised $115.9 million in fiscal 2001. For several years, the tax raised the cost of nursing home care by more than $100 million, and then the state gave about a tenth of that money to a small group of nursing home residents to help them absorb the higher cost of care created by the state. Such is the logic of giveaway government.

The state used the rest of the money from the tax to attract matching federal dollars that went to subsidize nursing homes - but the feds informed the Sundquist administration repeatedly over several years that such a tax-and-repay scheme was illegal. The state kept on doing it until this year, scamming Medicaid out of around $450 million. The administration's proposed budget includes setting aside $100 million for "federal contingent liability." That money is meant to partially repay the federal government for the money the Sundquist administration knowingly got via an illegal scheme.

So, follow the illogicality of it all: at first, the Sundquist administration deliberately raises the cost of nursing home care via a stiff tax, then helps a few nursing home residents pay the tax. Now it just raises the cost of nursing home care by $102.5 million this year, and hopes Uncle Sam will take $100 million to repay a $450 million debt.

With crack fiscal management like that, no wonder the state budget is so screwed up.

The budget is online here in a PDF file.