May 09, 2014
Contact: Alison Everett, 717-221-7935
Cell: 717-599-2077

Advocates Urge Legislature to Prioritize the Care of Frail, Elderly in Skilled Nursing Facilities

PHCA also praises Corbett Administration for plan to provide health coverage to 500,000 uninsured citizens without expanding the already strained Medicaid program

HARRISBURG — Just days after 600 skilled nursing center caregivers came to Harrisburg to ask legislators to make the care of the commonwealth’s frailest and sickest individuals a priority in the state budget, Stuart H. Shapiro, MD, an advocate for the elderly and President and CEO of the Pennsylvania Health Care Association, warned that Pennsylvania’s nursing centers are on a financially unsustainable path.

“Without increased funding for the care of residents on Medicaid, seniors who need around-the-clock care in the future may not be able to find it – at least not close to home,” said Stuart H. Shapiro, M.D., in an interview on “Pennsylvania Newsmakers,” a statewide public affairs program. “In five short years, Pennsylvania’s skilled nursing centers have gone from being the bedrock of our state’s long-term care network to a profession on life support, and it’s our frailest and sickest seniors who face the impact.”

Dr. Shapiro said two recent, independent studies confirm that skilled nursing facilities are on a financially unsustainable path. One study, by Avalere Health, a respected Washington, D.C., research company focused on health care, showed how Pennsylvania nursing facilities have seen their margins drop by more than 60 percent between 2007 and 2012, from 3.2 percent to 1.2 percent. Those margins dip even lower, to 0.3 percent, for facilities that care for 75 percent or higher Medicaid populations. That’s an 80 percent drop in margins from 2007 to 2012.

Another study, by Eljay LLC, a nationally recognized leader in long-term care consulting, showed that Pennsylvania reimburses nursing facilities an average of $26 a day – or $9,500 a year — less per resident than the true cost of care, which makes Pennsylvania one of the worst Medicaid payers in the country when comparing costs to payments. That shortfall has more than doubled since 2007, when it totaled $13.23 per resident per day.

Two-thirds of nursing home residents are in the Medicaid program, and unreimbursed Medicaid costs in Pennsylvania will exceed $470 million this fiscal year.

“When margins are this low, nursing homes can’t invest in technology that could aid in patient care. They can’t invest in necessary improvements for old buildings. And most importantly, they can’t invest in their staff, which leads to higher turnover,” he said. Studies show that high turnover has the potential to lower quality.

As some facilities turn away seniors on Medicaid because of unmanageable costs, access to care is a growing issue in parts of the state.

Skilled nursing centers care for the state’s sickest and frailest residents, such as those with advanced dementia or severe chronic health conditions that require around-the-clock care. Over the years, the acuity (sickness) level of residents has increased, as has the cost of care. But funding hasn’t kept pace.

Although all health-care providers lose money on Medicaid patients, none lose as much as skilled nursing facilities, whose Medicaid percentage is the largest among providers.

Dr. Shapiro commended Gov. Tom Corbett for increased funding in his proposed 2014-15 spending plan for the care of the elderly on Medicaid, and called on the General Assembly to once again fund a program that they created last year to aid nursing homes that care for a higher-than-average percentage of residents on Medicaid. That “add on” program would cost the state $16 million, while bringing in an additional $17 million in federal funds, to ensure seniors on Medicaid have access to long-term care in the communities where they live.

“As the studies show, these are some of our most vulnerable facilities serving our most vulnerable residents,” Dr. Shapiro said. “The program sunsets on June 30, and the Legislature cannot afford to let those facilities go dark. Lawmakers need to renew that program.”

In the second half of the program, Dr. Shapiro praised Governor Corbett and his administration, particularly state Department of Public Welfare Secretary Beverly Mackereth, for working tirelessly to get the governor’s Healthy PA initiative approved by the federal Centers for Medicare and Medicaid Services (CMS).

“The Governor and Secretary Mackereth communicate with CMS virtually daily in an effort to get 500,000 uninsured Pennsylvanians health coverage through Healthy PA,” Dr. Shapiro said. “I have been involved in national health insurance discussions for nearly 40 years, since I was a senior staff member to U.S. Sen. Ted Kennedy, and there is no doubt in my mind that Healthy PA is the right plan substantively, economically, and socially for Pennsylvania.”

Dr. Shapiro explained that right now, one in six Pennsylvanians is in the Medicaid program. With a traditional Medicaid expansion as proposed in Obamacare (Affordable Care Act), that number would rise to one in four. The independent Kaiser Commission estimated that Pennsylvania’s anticipated cost for a Medicaid expansion would exceed $2 billion over the next six years.

“That is money this Commonwealth and its taxpayers simply do not have now or in the future. Pennsylvania, like every other state, has difficulty meeting its current Medicaid obligations,” Dr. Shapiro said. “It would be fiscally disastrous for the state to increase the number of people on Medicaid. The Governor is right to expand coverage through the existing current health care marketplace and not simply say ‘yes’ to another flawed federal program such as Obamacare.”

“Pennsylvania Newsmakers” is one of the state’s premier politics and public policy television talk shows. The show is available at www.phca.org and will air regionally:

  • WGAL Channel 8 (Harrisburg and Lancaster) at 7:30 a.m. and 11 a.m. Sunday, May 11.
  • WBPH (Lehigh Valley and Philadelphia) at 8:30 p.m. Monday, May 12.
  • WKBS 47 (Altoona) at 11:30 a.m. Saturday, May 17.
  • WPCB 40 (Pittsburgh) at 11:30 a.m. Saturday, May 17.
  • CATV Channel 8 at 7 p.m. Tuesday, May 13 and 1 p.m. Wednesday, May 14.
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