February 28, 2014
Contact: Alison Everett, 717-221-7935
Cell: 717-599-2077

PHCA Commends Governor Corbett for Prioritizing Care of Elderly in State Budget, Asks Legislators to do the Same

HARRISBURG — Stuart H. Shapiro, MD, President and CEO of the PA Health Care Association (PHCA), 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 legislators to follow the governor’s lead to ensure the state’s frailest and sickest citizens have access to quality care.

“Governor Corbett made the elderly and disabled a priority in his budget by increasing funding for care across all settings — at home, in the community, and in a skilled nursing facility,” Dr. Shapiro said during a taping of “PA Newsmakers.” He asked legislators to support that increase – and also again fund a program they created last year that aids nursing homes that care for a higher-than-average percentage of residents on Medicaid.

Citing two new independent studies, Dr. Shapiro said the state’s skilled nursing facilities are on a financially unsustainable path. Without increased Medicaid funding, both quality of care and access to care are at risk.

“Unless the state increases payments for their care, this profession is not going to be able to meet the needs of current residents — let alone the growing demand for care as baby boomers age. It’s not a choice; it’s basic economics,” Dr. Shapiro said.

PHCA last week held a press conference to release the studies. 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, from Eljay LLC, a nationally recognized leader in long-term care consulting, showed that Pennsylvania reimburses nursing facilities an average of $26 a day less per resident than the true cost of care. 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, three things happen,” Dr. Shapiro said.  “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.  And studies show that high turnover has the potential to lower quality.

Dr. Shapiro said Pennsylvania’s skilled nursing facilities are doing everything they can to enhance the quality of care for residents, and made significant progress this year, including:

  • 6% increase in facilities with overall five-star ratings since 2013.
  • 37% increase in facilities with five-star quality ratings since 2013.
  • Enhancements on 16 of the 18 quality measures initiated by the Centers for Medicare and Medicaid Services including:
    • 10 percent reduction in the use of antipsychotic medication for long-stay and short-stay residents
    • 5.6 percent reduction in urinary tract infections for long-stay residents
    • 19 percent reduction in worsening pressure ulcers for short-stay residents and 6.6 percent reduction in pressure ulcers for long-stay residents
    • Nearly 19 percent reduction in pain for long-stay residents and nearly 7 percent for short-stay residents
    • PA’s average number of annual deficiencies and complaints (5.0) is lower than the national average, which is 6.8.

“The mission of all skilled nursing facilities to provide the highest quality of care and highest quality of life to the men and women who resident or rehabilitate with them,” Dr. Shapiro said.  “But it is getting harder and harder for them to uphold this mission when the divide between what care costs and what they are paid for that care grows wider and wider.”

Skilled nursing facilities 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 for long-term care has not kept pace, especially for Medicaid residents.

Dr. Shapiro called on legislators to do two things:

  1. Support the priority funding for seniors in Gov. Tom Corbett’s proposed budget by preserving the increase that will go toward increased utilization and costs for those being cared for in nursing facilities. Residents and caregivers in nursing facilities will receive a direct benefit from the additional dollars the Governor proposed: and
  1. Again fund an “add-on” payment for nursing facilities that serve a higher than average percentage of Medicaid residents so that these facilities can continue to do so, and so that seniors don’t have to leave their communities for care.

PHCA is asking legislators to add $16 million to a special program created last year for facilities that serve a high percentage of Medicaid residents so that those facilities can continue to provide care. That $16 million will be matched with about $17 million in federal funds.

Dr. G. Terry Madonna, Newsmakers’ host, asked Dr. Shapiro about Governor Corbett’s Healthy PA proposal.

“I have reviewed the standard Medicaid expansion that’s underway in many states, and I have carefully reviewed the governor’s Healthy PA proposal,” Dr. Shapiro said. “And there is no doubt in my mind that Healthy PA is the right plan substantively, economically, and socially for our commonwealth.”

“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, March 2.
  • WBPH (Lehigh Valley and Philadelphia) at 8:30 p.m. Monday,  March 3
  • WKBS 47 (Altoona) at 11:30 a.m. Saturday, March 8.
  • WPCB 40 (Pittsburgh) at 11:30 a.m. Saturday, March 8.
  • CATV Channel 8 at 7 p.m. Tuesday, March 4 and 1 p.m. Wednesday, March 5.
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