Long-term Care Quality and Modernization Act of 2007

Long-term Care Quality and Modernization Act of 2007 - Directs the Secretary of Health and Human Service to conduct a demonstration program requiring a state to establish a process for joint training and education of surveyors and providers for skilled nursing facilities (SNFs) and nursing facilities at least annually.

Amends title XVIII (Medicare) and title XIX (Medicaid) of the Social Security Act to allow resumption of nursing aid training programs in SNFs after correction of deficiencies.

Authorizes the Secretary to exclude from the Medicare prospective payment system (PPS) for SNFs: (1) certain (high cost and low probability) cancer treatment drugs, including antineoplastic drugs, antiemitics, and supportive medications; (2) all ambulance services, including those furnished to an individual in conjunction with renal dialysis services; and (3) other appropriate items and services.

Authorizes a physician, nurse practitioner, or clinical nurse specialist to certify under Medicare that a prescribed series of blood glucose tests are medically required.

Provides for: (1) counting of observation days in application of the Medicare post-hospital requirement for coverage of SNF care; (2) extension of the exceptions process for Medicare therapy caps; and (3) expansion of telehealth services to SNFs.

Directs the Secretary to study and report to Congress on developing management alternatives to the Medicare payment cap for physical therapy, speech-language pathology, and occupational therapy services.

Amends the Public Health Service Act to: (1) authorize the Secretary to make grants to, and contract with, physical therapy programs for projects to recruit and retain faculty and students, develop curriculum, and support the distribution of physical therapy practitioners in underserved areas; and (2) repeal the limitation to nonprofit entities only in the assignment of nurses under the nursing loan repayment program to private entities.

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

Directs the Secretary to: (1) establish the Long Term Care Quality Advisory Commission; and (2) make grants for five demonstration projects to implement and evaluate methods for improving the quality of health care in long-term care settings.

Amends the Internal Revenue Code to set a 15-year recovery period for qualified long-term care improvement property.