Jim Pieffer: Medicaid underfunding a major factor in nursing home crisis

Thanks to the Tribune-Review and reporters Brian C. Rittmeyer and Julia Maruca for their series “Nursing Home Crisis,” (Oct. 29, TribLIVE). They shined a light on a problem that’s been years in the making.

Many of the heartbreaking situations described in the series can be traced back to a staffing shortage affecting Pennsylvania nursing homes. At its root, this staffing shortage is caused by the fact that Medicaid has been chronically underfunded in Pennsylvania, and that is a situation that only our governmental leaders can resolve.

Medicaid is the joint federal and state government payor for approximately 70% of Pennsylvania nursing home residents. Nursing homes rely on Medicaid to cover the costs of residents who do not have the assets to pay for their care.

And Pennsylvania nursing homes, despite serving one of the oldest populations in the nation, were underfunded by $1.2 billion, according to a 2022 study by LeadingAge PA. This group represents nonprofit and mission-driven nursing homes and aging services providers in Pennsylvania.

Pennsylvania’s history of Medicaid underfunding means fewer options for our most vulnerable older adults. For example, it explains why:

• Aging service providers have a hard time paying employees more competitive wages. Unlike some companies like Starbucks, who can raise the cost of their products, our compensation is fixed at pre-inflationary rates.

• More than 300 nursing communities have closed in the U.S. since the start of the pandemic.

• Families can’t easily find a nursing home when a loved one is discharged from a hospital — no beds are available. In recent years, Presbyterian SeniorCare Network has had to take 50-100 beds offline due to funding and staffing shortages.

In fiscal year 2022-23, we saw our first bit of relief when the governor and Pennsylvania General Assembly approved a $294 million Medicaid rate increase in Pennsylvania — the first increase in nearly a decade. It was a good first step, but providers continue to face increased costs, and a sizeable funding gap remains in the wake of continued inflationary pressures and new staffing mandates.

The new allocation gives providers like us an average daily rate increase of approximately $35 per resident. But that leaves a shortfall of about $90 per resident per day for Presbyterian SeniorCare Network and other nonprofits, many of whom have an even higher gap, that are committed to ensuring quality staffing levels for vulnerable seniors.

Pennsylvania, for many years, has not prioritized older adults in the way other states have. Our reimbursement levels have trailed behind the national average for too long, and even with recent funding increases, our rates are nowhere near what it actually costs to care for our residents. In a 2019 Medicaid and CHIP Payment and Access Commission (MACPAC) Issue Brief, the percentage of Medicaid base rates paid relative to costs of care ranged from less than 70% of costs to more than 100% of costs for some states. Pennsylvania’s base rate covered only 73% of costs.

We think that Pennsylvania families who have a loved one who requires around-the-clock nursing care deserve better. And our frontline workers who care for them deserve better, too. I applaud the commitment of our 1,400 team members, and the thousands of workers across the aging services sector, who continue to care for older adults and families. They have hung in there through a pandemic and this worker shortage. They deserve our utmost respect and admiration.

How Pennsylvania supports the system that cares for older adults reflects our values. We look forward to working with our elected leaders to ensure that nursing homes and all aging services providers can provide the high-quality care our nation’s older adults need to live with dignity and respect.

If this issue is as important to you as it is to me, please contact your state representative and senator and let them know.