Nursing Homes Face Dual Threat from State Underfunding, Proposed Rule Change in Courts

HARRISBURG — For the fifth consecutive year, Gov. Tom Wolf’s draft spending plan for the 2019-20 fiscal year would flat-fund the state’s skilled nursing facilities at a time when the costs associated with providing complex long-term care are rising and the state’s rapidly aging population is in need of more services.

“The cost of care is rising, as are the costs for everything from labor to drugs and medical supplies to food and utilities. It gets to a point where, after years of being asked to do more with less, you simply can’t do more. We are at a breaking point,” said R. Sean Buckman, President and CEO of Carbondale Nursing and Rehabilitation Center in Lackawanna County and board chairman for the Pennsylvania Health Care Association.

Buckman discussed the dire consequences of the budget proposal during a taping of the statewide public affairs television show “Pennsylvania Newsmakers” with PHCA’s Government Affairs Director Zach Shamberg, who gave an update on a recently delayed “venue change” rule that would have ushered in skyrocketing medical liability premiums for long-term care facilities.

“Pennsylvania’s nursing facilities provide cost-effective, quality care to our most vulnerable populations, including frail elderly and disabled individuals,” Buckman said. “But the financial challenges we are facing are real. This perpetual lack of investment in seniors living in skilled nursing facilities is fiscally unsustainable.”

Two-thirds of all nursing facility residents, more than 52,000 seniors and individuals with disabilities, rely on Medicaid for their nursing facility care. But Pennsylvania nursing facilities lose an average of $47.50 each day, or $17,300 annually, for each Medicaid resident in their care because the state does not adequately pay for the cost of long-term nursing care.

Although the governor ignored medical cost inflation in keeping skilled nursing home funding is stagnant, year after year, his proposed budget would increase funding for inmate medical care by 5.6 percent, for a two-year increase of 17.9 percent, even as the numbers of inmates decline.

“While inmates deserve adequately funded quality care, doesn’t Pennsylvania’s oldest and neediest population deserve the same?” Buckman asked.

For each resident, facilities provide nursing care and related services, specialized rehabilitative services, medically-related social services, pharmaceutical services, dietary services personalized to the needs of each resident, emergency dental services, and non-emergency medical transportation. All of these services are provided for an average reimbursement rate of $8.24 per hour, which makes retaining and attracting talent difficult. Additional state funding would help nursing facilities pay more to direct caregivers. Having a dedicated caregiver is important because it means he or she gets to know the residents, and that knowledge and consistency of care help to improve outcomes.

Beyond the state budget, Pennsylvania’s skilled nursing facilities also are threatened by a proposed rule change from the Pennsylvania Supreme Court’s Civil Procedural Rules Committee.

Currently, medical liability claims can only stand trial in the county where an alleged medical error occurred. The rule change, if enacted, would allow attorneys to move medical liability claims to counties that award higher payouts – a deceptive, unfair practice known as “venue shopping.”

Escalating medical liability premiums created a crisis in Pennsylvania from 1997-2000. Reforms shepherded by the state legislature and court system in 2002 stabilized the medical liability insurance market. Ending venue shopping is among the reforms credited with halting the crisis. The rule change would bring back in an era of skyrocketing medical liability premiums, which would hit long-term care facilities especially hard.

“A nursing home in Lackawanna County should not be dragged into a court case in Philadelphia simply because the verdicts for plaintiffs may be superior and the awards may be higher,” Shamberg said. “That’s not a jury of peers. That’s an injustice.”

Nursing homes already are under attack from predatory, out-of-state law firms that come to Pennsylvania to file hundreds of lawsuits. Long-term care companies have sold buildings, filed for bankruptcy, or simply fled the state altogether. Reinstituting venue shopping would make the current legal environment even worse and potentially spell the end for many providers across the state, Shamberg said.

PHCA is a part of a coalition — which also includes the Pennsylvania Medical Society (PAMED), The Hospital and Healthsystem Association of Pennsylvania (HAP) and the Pennsylvania Coalition for Civil Justice Reform (PCCJR) — that succeeded in delaying the rule change. Comments were due to the Civil Procedural Rules Committee by Feb. 22, but the court reversed track and agreed to hold off reinstating the venue change rule until the legislature studies the issue more. There is no time table for a decision.

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

• WGAL Channel 8 (Harrisburg and Lancaster) Sunday, March 3, at 11:30 AM
• WBPH (Lehigh Valley and Philadelphia) Monday, March 4, at 8:30 PM
• WKBS 47 (Altoona) Saturday, March 9, at 9:30 AM
• WPCB 40 (Pittsburgh) Saturday, March 9, at 9:30 AM
• MeTV (Susquehanna Valley) Sunday, March 3, at 11:30 PM