AFSCME represents thousands of people who work in nursing homes across Wisconsin so our Union pays close attention to long-term care issues, including those affecting the state’s 373 certified nursing facilities.

Many nursing home residents have little income and few assets and they rely on Medicaid to pay for their care. Medicaid is the joint state/federal government program that pays for health care services for low-income people. AFSCME and our nursing home industry allies have lobbied for modest increases in Medicaid funding for nursing home care, but those increases barely keep up with inflation. Like other health care costs, long-term care costs are rising faster than inflation.

Funding for nursing homes is an extraordinarily complicated matter, with payments to facilities determined by a formula based on patient care needs, labor costs, utilities, geographic region and more. When the State Legislature approved a 5% increase in rates for 2008, it might be assumed that each home would get a 5% increase, but that is not the case. The additional money was an increase in the overall allotment for nursing homes. The 5% increase will be distributed to facilities based on the nursing home Medicaid reimbursement rate formula, with some homes getting more than 5% and others, less.

Wisconsin state government is keenly aware of the inadequacies in nursing home reimbursements and skyrocketing Medicaid costs. The response to chronic nursing home deficits has been disappointing. Like other states, Wisconsin is experimenting with alternatives to long-term care to reduce Medicaid expenditures. AFSCME members who work in nursing homes are familiar with the state’s nursing home “resident relocation” and “Family Care” initiatives.

Both initiatives involve reduced nursing home care and increased reliance on community-based settings. State officials believe they can use scarce Medicaid dollars more efficiently and serve more people in community settings, such as group homes, community-based residential facilities, or at home.

AFSCME believes that the emphasis on moving people into community settings may work well for some individuals but not everyone. Our Union has experience with relocations because the state has been moving residents out of the state centers for the developmentally disabled for many years, with mixed results. Like the centers, nursing home residents today, by and large, truly need the high level of care that these institutions provide. These individuals have complex medical needs or chronic conditions that merit the kind of 24/7 nursing care that is cost-effective in an institutional setting.

There are drawbacks to community-based care for the elderly and disabled. Current state regulations, staffing requirements and oversight of community settings are inadequate and could put residents at risk. Community settings ought to be held to similar health and safety standards as institutional settings and the regulations should be based on who is served, not the setting in which they live. That is why AFSCME supported a 2005 law that requires the state to report on the status of individuals who have been moved out of nursing homes and state centers for the developmentally disabled. The goal is to provide data to help policy makers assess whether or not the relocation initiative is fulfilling its promise.

Another drawback to community-based care is that it is largely dependent on private providers. The only way for them to make a profit is to cut back on services. This could have serious consequences for elderly and disabled people. Unchecked privatization of long-term care could pose harm to those least able to defend themselves. There are other issues related to chronic underfunding of nursing homes. The Wisconsin Association of Homes and Services for the Aging (WAHSA), which represents county-owned homes and not-for-profit facilities, collects data on nursing homes and tracks their financial condition. Here are a few other statistics from WAHSA that paint a grim picture:

●  An analysis of 2006 Medicaid rates found that 95.7% of the state’s nursing homes were not fully reimbursed for the cost they incurred serving the Medicaid-funded residents.

●  In 2007, the “Medicaid deficit” was $265.7 million, for an average loss of over $758,000 per home.

●  In 2006, 85.7% of county homes suffered financial losses.

●  Since 1999, 39 nursing homes have closed, many in Milwaukee.

●  The average nursing home resident today has more complex medical needs.

●  Nursing homes face difficulties recruiting and retaining capable and high quality direct care staff and leadership staff.

●  The average age of nursing homes is 30 years, which does not permit them to incorporate modern design elements to adapt to changes in the industry.

These statistics are not new and are hardly surprising to nursing home caregivers. Financially-strained facilities take a huge toll on residents and caregivers alike. Funding shortages create high staff turnover, forced overtime, long hours of work and stressed out staff; all of which can compromise care to residents. Deficits result in downsizing or closures, which create access problems for people who need care.

The situation is much worse for those who work in county-owned nursing homes. Most homes try to have a mix of Medicaid/private pay residents because private insurance pays more for care than Medicaid, and they rely on private insurance to offset Medicaid losses. County homes have few private pay residents and they run high operating deficits. County homes also tend to have residents that are costlier because they are harder to care for, which adds to the county home financial problems. Over the years, many counties have closed or sold off their homes because of the high costs of operation. In 2009, things could get worse for county homes because of the property tax levy limit, which limits increases at 2% (or the rate of growth).

Those remaining county nursing homes receive supplemental funds from local property tax dollars, but that is another unstable source of revenue given the whims of county boards. AFSCME recently lost the Manitowoc County Health Care Center to a private interest. This fall, voters in St. Croix County will decide whether or not to keep or sell that county’s nursing home.

Nursing home care is an essential public service that should be one of many long-term care options available to the elderly and disabled. There will always be a need for nursing home care, and it should be properly funded. Nursing home residents and staff should not suffer with inadequate reimbursements because of the unchecked zeal to downsize institutions.

 

For more information, call the AFSCME Area Office at 608-836-6666.