June 16, 2017
Contact: Eric Kiehl, 717-231-7935
Cell: 717-599-2077

Prioritizing Care for Pennsylvania’s Frail Elderly Population Includes Adequate Funding, Lawsuit Abuse Reform

HARRISBURG — With the first days of summer quickly approaching, adequate funding to care for Pennsylvania’s frail elderly population and legislation aimed at protecting skilled nursing facilities from predatory lawsuits are among the hot topics facing senior care in the commonwealth, said Russ McDaid, President and Chief Executive Officer of the Pennsylvania Health Care Association (PHCA).

“Pennsylvania’s skilled nursing facilities face a crisis as a result of chronic underfunding and our state is at a crossroad where it faces tough budget decisions and skilled nursing facilities can no longer afford to operate,” McDaid said. “Even as older residents today suffer from more complex medical conditions and debilitating afflictions, such as dementia or Alzheimer’s disease, state Medicaid funding has been flat for four of the last six years. The system we currently have in place is unsustainable and care in our communities has reached a critical tipping point.”

As Pennsylvania’s “baby boomer” generation comes of age, it is estimated that approximately 2.2 million residents are now over the age 65 and that nearly 70 percent of them will need long-term care in their lifetime. The commonwealth ranks fourth nationally in the percentage of residents who are seniors, with the fastest-growing segment of its population, residents age 85 and older, expected to exceed 400,000 residents in the year 2030.

The level of care required by the state’s elderly residents is increasingly more advanced, more expensive and more dependent on skilled caregivers to provide the intensive, around-the-clock, restorative care that is needed. Despite the fact that two-thirds of all skilled nursing facility residents rely on Medicaid to pay for their care, Medicaid funding in Pennsylvania has been flat for four of the last six years. Current Medicaid reimbursement levels pay skilled nursing facilities $25.43 per day less than the cost of providing care, a funding shortfall equates to a gap of $9,300 annually, on average, for every Medicaid resident in a skilled nursing facility in the commonwealth.

“Our families and our communities will suffer if we do not find way to increase Medicaid reimbursement levels and make funding care for our frail and elderly populations must be a priority,” said McDaid. “Pennsylvania’s population is going to continue to age in the coming decades and the demand for complex, quality care is going to continue to grow. We have to decide if we are willing to find a way to fund skilled nursing facilities, or if we are going to continue to ignore this problem until we no longer have any care options available in our communities.”

Compounding the crisis situation facing senior and skilled nursing care in Pennsylvania is lawsuit abuse from predatory out-of-state lawyers filing frivolous lawsuits. Since 2011, nursing homes across Pennsylvania have been attacked in more than 150 full-page newspaper advertisements, all purchased by firms located outside of the state, with the number of ad buys increasing as cases are settled out of court.

Liability costs have skyrocketed for Pennsylvania’s nursing homes in recent years as result of the advertisements. Pennsylvania’s Medicaid program spent more than $104 million on liability-related costs in 2015, much of it on contingency fees to out-of-state lawyers who are taking advantage of the state’s lax tort laws.

“These lawsuits have nothing to do with the quality of care in these facilities,” McDaid said. “Instead, it has everything to do with predatory lawyers taking advantage of the system to line their own pockets. Every dollar spent defending against frivolous lawsuit is a dollar taken away from patient care!”

State Rep. Warren Kampf, R-Chester/Montgomery, has introduced legislation (H.B. 1037) that would end lawsuit abuse. His bill would limit punitive damages awards to 250 percent of the amount of compensatory damages for long-term care providers. The legislation does not limit compensatory damages for individuals who may have been harmed, nor does it change the definition of punitive care in effect for physicians since 2002. It simply extends the same protections to long-term care facilities.

Without protections, providers and their insurers are more likely to settle a weak case than risk a runaway jury that could bankrupt their business. As a result of reforms more than 15 years ago, physicians now litigate 80 percent of malpractice cases because they believe the case will be judged fairly on the merits without the risk of unpredictable punitive damage awards by runaway juries – a change that directly benefits health care in Pennsylvania. McDaid believes legislation like H.B. 1037 will provide similar benefits to nursing homes in in the state.

“Every nursing home administrator I speak with expresses the same frustration – the time, resources and money being spent on these cases could be going to better wages and benefits for staff, or improvements to their buildings, or even equipment and activities for residents all take a backseat to the price tag for defending frivolous lawsuits,” McDaid said. “This is issue is very personal for caregivers, who routinely do everything they can to ensure residents enjoy compassionate, quality care. We need lawsuit abuse reform, and we need it now!”

“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) Sunday, June 18, at 7:30 a.m.
  • WBPH (Lehigh Valley and Philadelphia) Monday, June 19, at 8:30 p.m.
  • WKBS 47 (Altoona) Saturday, June 24, at 9:30 a.m.
  • WPCB 40 (Pittsburgh) Saturday, June 24, at 9:30 a.m.
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