By Adam Marles
Following years of Medicaid funding cuts from state government, not-for-profit nursing home providers across Pennsylvania are being forced to make incredibly difficult decisions.
Can we hire more employees to care for our seniors?
Will we be able to pay our existing employees a competitive wage to keep them here?
Is it possible to raise enough charitable funding to cover the continued cuts to Medicaid and increasing regulatory burdens?
Can we remain open?
The last question is clearly the most serious, and the concern is very real. No less than five different not-for-profit nursing homes in Pennsylvania are asking it right now. LeadingAge PA, the voice of not-for-profit senior services in Pennsylvania, believes the state General Assembly can solve this problem by fairly funding senior care services in the commonwealth with a very sensible solution.
For several years, the commonwealth has ignored Medicaid funding requirements. In his budget proposal released in February, Gov. Tom Wolf flat-funded Medicaid once again. By doing this, Pennsylvania is failing to keep pace with health care inflation as it ramps up regulations (and costs) on even the best of our not-for-profit nursing facilities.
Here’s the stark reality: In the past 15 years, the commonwealth has averaged increasing Medicaid rates by barely 1 percent per year. During that time, the cost of providing nursing home care has increased nearly 33 percent.
It’s gotten so bad that Pennsylvania’s nursing homes suffered a Medicaid funding shortfall of more than $631 million in 2017-2018, according to a Medicaid Funding Gap Analysis commissioned by LeadingAge PA and conducted by consulting firm RKL LLP.
For nonprofit nursing homes, the reimbursement gap translates to a daily loss of $82.16 per patient, well above the already troubling state average of $47.85.
The findings of this study boldly reinforce the crisis our members continue to face. This chronic underfunding appears to only be getting worse.
In the last four years, Pennsylvania has provided a 1 percent increase — total. The 2019-20 budget proposal calls for another year of flat-funding as health care costs continue to skyrocket.
This simply cannot continue if state lawmakers expect nursing facilities to provide the best care for seniors. It is becoming impossible for not-for-profit nursing homes to keep up — leading to staffing losses and shortages. Some have been forced to sell to for-profit companies. In other cases, closure is a real possibility in the coming months.
We can fix this problem. It cannot be solved overnight, but we can start now by reversing this 15-year trend to ensure our seniors receive the care they deserve.
That means Pennsylvania matching modest federal guidelines and increasing Medicaid funding by only 2.8 percent in the fiscal year 2019-20 budget. Lawmakers should also provide $17 million to fund the nonpublic medical assistance day one incentive payment. This important program is a vital tool wisely created by state lawmakers to preserve access to care.
The governor has focused on home-based care, and we certainly agree with him that programs in this area should be a priority.
Who among us doesn’t want to spend as much time as possible living our retirement years in our own homes? We all would. But to solely rely on home-based care fails to acknowledge reality: Pennsylvania has the second largest 85-and-over population in the United States.
This unfortunately means that unless a family is incredibly wealthy, their loved one will have to look at nursing home care because around-the-clock home care simply isn’t affordable. No level of state government support can overcome such costs.
By committing to matching the rate of nursing care cost increases each year, Pennsylvania will address years of crippling underfunding that threatens the quality of care seniors receive from our not-for-profit members. Pennsylvania seniors and their loved ones deserve this.
Adam Marles is the president and CEO of LeadingAge PA, the voice of not-profit senior care in Pennsylvania.