June 03, 2024
Contact: Eric Heisler, eheisler@phca.org
Cell: 717-678-1031

Access to Senior Care Continues Troubling Trend as Providers Plan to Close or Sell More Facilities

PHCA member survey reveals more concerns about operational viability for nursing home providers

Harrisburg, PA (June 3, 2024) — In a new survey conducted by the Pennsylvania Health Care Association (PHCA) of nursing facility members, nearly 50 percent of participating owners/operators revealed they have plans to close or sell one or more nursing facilities within the next year. This potential downsizing will happen at a time when access to care at nursing facilities is already an issue for seniors and adults with disabilities across Pennsylvania. The survey revealed that approximately half of the participating facility administrators denied admissions to new residents in the first quarter of 2024 because the facility did not have enough staff to meet new staffing requirements for additional residents.

Survey responses identified inadequate Medicaid reimbursements as the number one reason why the operating environment in Pennsylvania is not viable. An analysis conducted by CliftonLarsonAllen of 2022 data revealed that the average operating margin for a nursing facility in Pennsylvania was -11.7 percent, reinforcing viability concerns. Other highly ranked challenges facing owners and operators in 2024 are Pennsylvania’s soon-to-increase staffing mandate and a lack of available workers.

“Pennsylvania’s fastest growing demographic is adults aged 80 and older. We know this growing portion of our population will need long-term care, yet Pennsylvania facilities are being forced to close because senior care isn’t valued. It’s that simple,” said Zach Shamberg, president and CEO of the Pennsylvania Health Care Association. “This is not a future problem, it’s happening today. Our older loved ones and neighbors can’t be cared for because, for too long, we’ve neglected to invest in and support senior care in this commonwealth.”

An inability to recruit more workers, which requires more state funding to offer competitive wages, stands out in the survey as a large reason why Pennsylvanians are struggling to access care.

Eighty percent of participating facility administrators revealed they have 11 or more open direct care positions. The amount of facilities with 11 or more open positions has increased from information gathered during a 2023 PHCA member survey. Nearly 75 percent of participating administrators also revealed they have beds that are unable to be used because their facilities do not have enough caregivers to staff all beds.

“There are nearly 65,000 residents in Pennsylvania nursing homes, and 45,000 rely on the state’s Medicaid program to pay for their care –– a health care responsibility long accepted by our state government,” said Shamberg. “Providers can no longer sustain care –– or open their doors to new residents –– because they can no longer make up the difference in state reimbursement inadequacies compared to the true cost of care for low-income seniors. The system is about to crumble and when it does, it won’t just be a loss for our parents and grandparents, it will be a loss for all of us.”

More than 20 nursing facilities in Pennsylvania have ceased operations since the start of the pandemic. The primary reason for closures has been an inability to sustain operations due to inadequate Medicaid reimbursements for the cost of resident care.

The closure of two more nursing facilities in Pittsburgh has been announced for July and August. Nearly 180 residents will need to find care elsewhere.

PHCA is advocating for more than $25 million in this year’s state budget to offset the cost of the state’s staffing mandate, as well as $100 million in supplemental funding through a new program centered around quality performance metrics. PHCA is asking the state legislature and Governor Shapiro to adopt and fund a quality incentive program called Enhancing Care With Incentivized Payments, or ecwip for short. The program is designed to distribute quarterly supplemental funding to providers who meet specific quality metrics. Combined with other supplemental payments for high-Medicaid nursing facilities, this represents a total ask of more than $140 million in the 2024-25 state budget.

Pennsylvania nursing facilities need state officials to undo years of insufficient investment in senior care and end the Medicaid reimbursement shortfall gap. PHCA’s budget proposals are a step toward properly repaying providers, while offering supplemental funding to help offset rising costs.

To access the full survey report, click here.

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