PHCA Offers Insights On The Future Of Long-Term Care

HARRISBURG —  Stuart H. Shapiro, M.D., CEO of the Pennsylvania Health Care Association (PHCA) and Paul McGuire, PHCA Board Chairperson and Vice President of Operations for Mid-Atlantic Healthcare, a PHCA member company, today provided testimony in front of the House Aging and Older Adult Services Committee to highlight key challenges facing PA’s nursing homes and long-term care providers.

As a vital part of today’s long-term care marketplace, Pennsylvania’s nursing homes provide the highest level of care to ensure that approximately 80,000 of Pennsylvania’s sickest, frailest elderly and disabled residents live a healthy, safe life and age with dignity and respect in nursing homes across the state.
But the true heroes in Pennsylvania’s nursing homes are the dedicated women and men who show up to work every day and provide high quality care to our mothers or fathers; our grandmothers or grandfathers; and do so with a caring touch and a smile.

“The direct caregivers we employ are true heroes in every sense of the word,” said McGuire. “They show up to work each and every day, and provide high quality, highly compassionate care to the residents who have entrusted them with their care. They ALL have my undying admiration and respect.”

Mr. McGuire then noted the financial hardships currently facing nursing homes as these dedicated staff members are caring for individuals that many years ago would have been cared for in a hospital.

“As the level of care needed by residents has risen, so has the cost to provide this care,” said McGuire. “Unfortunately, funding has not kept pace with costs, especially for those supported by Medicaid, the state’s Medicaid program is putting Pennsylvania’s nursing facilities on a financially unsustainable path –even as the need for high-quality long-term care continues to grow.”

Despite these chronic financial challenges Pennsylvania’s skilled nursing facilities continue to provide the highest level of care to the men and women who rely on our centers for their daily living needs, and comfort to the families who entrust us with their care.

From the first quarter of 2014 to the first quarter of 2015, Pennsylvania nursing homes improved on 10 of 11 quality measures, according to the U.S. Centers for Medicare and Medicaid Services’ five-star rating system, and now rank better than the national average on 8 of the 11 measures.

“Unfortunately, despite the high level of quality care being provided, Pennsylvania has become a magnet for aggressive advertisements by out-of-state predatory law firms that have moved to the commonwealth to file volumes of lawsuits in the hope of cash settlements,” Shapiro noted. “In recent years the number of cases, and the payouts against nursing homes and other providers of long-term care services, has been increasing faster in Pennsylvania than any state in America. This has nothing to do with quality of care.”

According to a recently released actuarial analysis on liability costs, the liability cost per Medicaid day in Pennsylvania is $4.96. Given that Medicaid paid for about 19.2 million days of care in 2014, Medicaid spent more than $95 million on liability related costs in 2014.

“Punitive damage reform is crucial for Pennsylvania’s long-term care providers in order to continue to provide quality care to our most vulnerable citizens. Excessive litigation and damage awards result in higher consumer costs and decreased availability,” said Shapiro.

Shapiro then cautioned the committee about the implementation of managed long-term care in Pennsylvania.

“Managed care for the elderly and disabled is coming to Pennsylvania, and I hope that we do it right,” said Shapiro. “He recommends that the departments proceed prudently, not lock the commonwealth into one program, and consider testing alternatives to fully capitated MLTSS as part of an extended Phase 1. For example, a viable program could include a provider owned or operated program subject to some type of capitation. Make the providers part of the solution. Eliminating the ‘middleman’ may save money and improve care.”

“If we are not careful in its implementation, we run the risk of spending millions of extra dollars, reducing access to care for the elderly, and destroying an infrastructure of caregivers and providers that have taken decades to establish.”

Before concluding, Shapiro offered the Committee several ways other than Medicaid to improve the financing of long-term care services in Pennsylvania.

“How we care for the commonwealth’s rapidly aging population promises to be one of our state’s most pressing social and fiscal challenges, and how we deal with this will be a real measure of our humanity,” said Shapiro. “No one likes to think about getting older, facing chronic illness or becoming too frail to safely live on our own. But it happens, and when it does, more and more seniors and their families are finding themselves unprepared.”

“Clearly, individuals should carry a part of the responsibility for financing their own long-term care whenever possible, and long-term care insurance, conversion of life insurance for long-term care and reverse mortgages are possible solutions,” said Shapiro as he challenged the committee to look at several ways to improve the financing of long-term care services in Pennsylvania. “Government must play a role, but new government programs are not the only answer. Government can’t afford to take on much more.”