Long-term Care Quality and Modernization Act of 2006

Long-Term Care Quality and Modernization Act of 2006 - Amends titles XVIII (Medicare) and XIX (Medicaid) of the Social Security Act (SSA) with respect to long-term care.

Amends SSA titles XVIII and XIX to require states to establish a process for joint training and education of nursing home surveyors and providers at least annually as changes to nursing facility regulations, guidelines, and policy are implemented and used in surveys of participating facilities.

Amends SSA titles XVIII and XIX with respect to: (1) facility-based training for new surveyors; and (2) resumption of nurse aid training programs for skilled nursing facilities (SNFs) after correction of deficiencies.

Permits split or shared Medicare billing by physicians and nurse practitioners in SNFs.

Amends SSA title XVIII to permit nurse practitioners employed by SNFs to certify skilled care.

Directs the the Secretary of Health and Human Services to establish a condition-based system of physical therapy services based on medical necessity, including a standardized patient assessment tool for evaluating service levels and limiting Medicare coverage.

Amends SSA title XVIII with respect to: (1) Medicare SNF specific wages; (2) authority to exclude high cost and low probability cancer treatment drugs as well as additional items and services from the Medicare prospective payment system (PPS) for SNFs; and (4) exclusion of all ambulance services from that PPS.

Directs the Secretary to establish a national nursing database to predict future nursing shortages.

Amends the Public Health Service Act to require annual reports to the Secretary on nursing levels.

Amends the Internal Revenue Code to provide for: (1) a 10-year recovery period for qualified long-term care improvement property; (2) an investment tax credit for long-term care facility information technology; (3) tax-exempt long-term care trust accounts to which an individual may contribute up to $5,000 annually; (4) a refundable tax credit for 10% of annual contributions to such an account; and (5) an income exclusion for certain distributions from such an account for chronically-ill individuals.

Amends the Robert T. Stafford Disaster Relief and Emergency Assistance Act to authorize the President to make contributions for repair or replacement to the owner or operator of a long-term care facility damaged or destroyed by a major disaster.