Medicaid cuts impact nurses’ pay
By Jane Myhra
Area nursing homes and assisted living providers are facing a workforce shortage crisis.
The increased difficulty in recruiting staff is directly due to the inability to offer competitive wages, according to Greg Loeser, administrator at Iola Living Assistance Inc.
Loeser noted that the inability of long-term care (LTC) providers to offer competitive wages is due to their heavy reliance on Medicaid and Medicaid-waiver funding.
“These cuts are the main issue contributing to the workforce crisis,” Loeser said. “Nurses have so many more options of where to work and better working conditions than hospitals or skilled nursing facilities.”
He said ILA attracts workers by offering better incentives.
“Iola offers a competitive benefit package and incentives to attract certified nursing assistants and nursing staff,” Loeser said. “Rural areas do not have the amenities and the attractions of cities. This adds to the difficulty of attracting staff.”
Bethany of Waupaca also has staffing concerns.
“We actually have very few positions in nursing open, but are finding it hard to get other department staff, such as food service, activities and maintenance,” said Pauline Darling, CEO/administrator at Bethany.
According to Darling, the facility cannot compete with the rates offered at other Waupaca County facilities.
“King and Lakeview have better pay/benefit packages than we can afford,” she said. “As a matter of fact, I believe McDonald’s and Culver’s start employees at a higher rate than we are able to.”
At Bethany, the semi-private room rate for a private pay resident is $265, with a Medicaid reimbursement of $150.
“We currently run 65 to 70 percent Medicaid,” Darling said. “Staffing requirements and the ability to provide adequate staffing are challenged, to say the least, by reimbursement rates this low. It’s appalling.”
Both Darling and Loeser said their facilities lose money on Medicaid.
“This year, our nursing facility is projected to lose north of $400,000 caring for the Medical Assistance (MA) population,” Loeser said. “This is similar to the amounts lost the past several years.”
According to Loeser, the state taxes each skilled nursing bed $170 per month. Wisconsin also provides less funding per Medicaid resident.
“The state of Wisconsin has significantly underfunded skilled nursing facilities for a very long time,” Loeser said. “The Medicaid deficit is so large skilled nursing facilities can no longer shift the cost to private pay individuals. Private pay individuals pay $100 per day more than Medical Assistance/Family Care pay for the same service.”
ILA’s skilled nursing facility (SNF) is licensed for 50 skilled nursing beds. In 2015, two-thirds of its 107 admissions were new clients. According to Loeser, the average length of stay for a short-term rehabilitation resident at the Iola facility is about 28 days.
ILA also operates Living Oaks, a certified residential care apartment complex (RCAC) with 24 units, and Butternut Ridge Apartments for independent living.
The average age of Living Oaks residents is 88, with eight of the current 12 residents being new clients. According to Loeser, one-third to half of the apartments turn-over each year.
Butternut Ridge has a one-third turn-over of occupants.
Bethany of Waupaca serves 104 in its skilled nursing facility (SNF), 20 in assisted living (AL) and 40 independent living (IL) residents.
Currently more than 87,000 Wisconsin residents live in long-term and residential care facilities. This represents an 18 percent increase since 2003.
A nation-wide study published in March 2016, reported Wisconsin’s Medicaid system for reimbursing nursing homes as the worst in the U.S. In 2015, the same study reported Wisconsin as the third worst in the country.
A recent state-by-state analysis of the nation’s Medicaid nursing home reimbursement systems concluded the average Wisconsin facility loses $55.89 per day for each of the approximately 16,490 Medicaid recipients residing in a state nursing home.
“The Long-Term Care Workforce Crisis: A 2016 Report” surveyed 689 facilities statewide.
The report found that one in seven direct caregiver positions in Wisconsin’s nursing homes and assisted living facilities are currently vacant. The survey found there are as many as 11,500 job openings in LTC facilities across the state.
The report showed that LTC providers are struggling to offer competitive wages compared to other unskilled positions available at fast-food restaurants, big box stores, national gas station/convenience store chains and other non-healthcare-related organizations.
The average certified nursing assistant (CNA) in Wisconsin earns an average of $13.32 per hour.
The report also showed that a significant percentage of the long-term care workforce in Wisconsin relies on public assistance programs like BadgerCare.
“What does it say about our priorities – we pay many of those who care for our loved ones a wage sufficiently low as to make them eligible for public assistance funding?” John Vander Meer, executive director of the Wisconsin Health Care Association, stated in the report. “All long-term care providers agree that offering higher wages for direct caregivers not only will help fill thousands of available jobs, but also will help our workers achieve greater independence from state assistance programs.”
In Wisconsin, Medicaid pays for the care of nearly two-thirds of all nursing facility residents. On average, the nursing facilities lose $55.89 per day for each Medicaid resident they serve.
“While demand continues to grow for long-term care services, Wisconsin’s care providers are hamstrung in the marketplace by their heavy reliance on insufficient Medicaid and Medicaid-waiver funding,” John Sauer, president/CEO of LeadingAge Wisconsin, said in the report. “Long-term care providers are committed to offering the best care possible to our state’s frail elderly and disabled residents, but that requires sufficient staffing, a requirement made that much more difficult to achieve because of the increasing challenges to compete for needed staff.”
The survey respondents reported an average caregiver vacancy rate of 14.5 percent. A total of 70 percent reported no qualified applicants for vacant caregiver positions, with 50 percent of providers having no applicants.
The report concluded that the combination of heavy reliance on the Medicaid program and the insufficient funding of that program severely limits a nursing home’s ability to compete in a tight labor market.