Click here to subscribe today or Login.
First Posted: 5/6/2014
HARRISBURG — Pennsylvania’s Medicaid reimbursement shortfall has reached historic heights for the state’s nursing homes, according to recent reports commissioned by the Pennsylvania Health Care Association.
The Medicaid reimbursement program misses the mark by roughly $26 per patient each day, which has entrenched private nursing homes in “unsustainable” profit margins that are among the lowest in the health care industry, the reports show.
On Tuesday, more than 600 skilled nursing center administrators and caregivers rallied in Harrisburg to urge state legislators to honor Gov. Tom Corbett’s proposed $3.3 billion in Medicaid funding for nursing home and long-term care reimbursements for the 2014-15 fiscal year.
They also were advocating an additional $16 million for nursing homes that have more residents dependent on Medicaid. That money was approved in last year’s budget, and the federal government will match the state commitment with an additional $17 million, the association said in a news release.
The association, a lobbying group for health care providers, organized the rally at which more than half a dozen Wyoming Valley area nursing homes were represented.
Holly Eichhorn, the administrator for River Street Manor in Wilkes-Barre, said she has watched state funding dwindle during the five years she has been at River Street to the point where she has had to turn away some in need of more expensive care.
“We do review each patient on a case-by-case basis,” Eichhorn said. “Unfortunately, with the high cost of (some) medications and medical equipment, we have been forced to turn some people away.”
About 65 percent of River Street’s 120 residents depend on Medicaid reimbursements and at present Medicaid gives River Street about $211 per resident, per day, Eichhorn said.
An extra $26 per patient each day in reimbursements could allow the facility to make necessary upgrades and accept more patients, she said.
Medicare, private insurance and families make up the difference in payments, but Eichhorn said the facility loses about $9,500 per patient each year due to the Medicaid shortfall.
“One month of private care in a nursing home is very close to $10,000 a month, and families simply do not have the resources to do that privately,” Eichhorn said.
Falling margins
Between 2007 and 2012, profit margins for Pennsylvania nursing homes fell from 3.2 percent to 1.2 percent, according to one report the Washington, D.C., research firm Avalere completed for association. Nursing homes that have more than 75 percent of their residents dependent on Medicaid showed 0.3 percent profit margins, the report says.
Louise Forsha, HCR-ManorCare: Hampton House administrator, said the Hanover Township nursing home relies on that margin for capital improvement projects and to encourage employees to stick around.
Luzerne and Lackawanna counties are fat with health care centers, and workers have plenty of job options, Forsha said. The staff turnover leads to problems in the quality of care, she said.
Hampton House nearly fits into the high-Medicaid dependency category.
“In my building, I’m about 72 percent on Medicaid,” Forsha said. “If you do the multiplication on that, it comes up to about $700,000 a year that we’re short.”
House support
State Rep. Eddie Day Pashinski, D-Wilkes-Barre, said he supports the group’s position.
“Their concern is completely legitimate,” he said. “They’re experiencing patients with a higher acuity of care, which means the cost has increased.”
Because of other budget issues, Pashinski said he wasn’t sure Medicaid reimbursements would get a boost. Pashinski sits on the House Human Services Committee and is minority chair of the Aging and Older Adult Services subcommittee.
He said met during the rally with employees of nursing homes, some of whom said they had not received a raise in four years.
“Have you ever been in a nursing home?” Pashinski said. “Its a tough, tough job. These people who work there are angels, and they’re not being paid appropriately.”