In an alarmist State of the Nursing Home Sector, the American Health Care Association (AHCA) reports, yet again, dire news about nursing facilities. It claims that historic labor shortages have led to the lowest nursing home staffing levels since 1994; 96% of nursing facilities report difficulty finding staff; 54% of facilities limit admissions because of staffing shortages; 52% of facilities say they may not be able to continue operating for more than a year; 465 nursing homes closed during the pandemic; and more. With the constant barrage of negative claims about staffing shortages and facility closures, how could potential residents, their families, and potential staff possibly feel comfortable in choosing a nursing home in which to live or work? Such an alarmist message tells potential residents and staff to stay as far away as possible . . . and they are.
Older people do not want to go to nursing homes. A new AARP poll finds that 89% of Democrats and 72% of Republicans want more services to help people remain in their own homes instead of going to a nursing facility. People want more support for family caregivers.
AHCA acknowledges that care settings other than nursing homes have seen their staffing return to pre-pandemic levels. Staffing shortages often reflect problems in nursing facilities, not the lack of people who could be hired to provide care.
What is AHCA trying to accomplish with its dire news? The only way to read AHCA’s relentless message is to recognize that it is not actually meant for residents, families, and staff at all. AHCA is addressing federal and state lawmakers, in a demand for more public money and as part of its ever-escalating challenge to the Biden-Harris Administration’s commitment to enact nurse staffing ratios for nursing homes later this year.
AHCA’s Campaign to Defeat a Staffing Ratio
Even before a nurse staffing ratio has been publicly proposed, AHCA has already promised a “massive campaign” to defeat the ratio that AHCA CEO Mark Parkinson anticipates will be in the proposal: 4.1 hours per resident day for nurse staffing. This standard is a staffing level that was identified in a federally mandated report (released in 2001) as the minimum staffing level needed to prevent avoidable bad outcomes for residents. This is also the staffing level necessary to meet some of the requirements of the 1987 Nursing Home Reform Law. Parkinson says facilities cannot meet this minimum standard today, despite broad recognition that residents have much greater care needs today than they had nearly 25 years ago, when the staffing standard was first identified.
AHCA’s “massive campaign” includes strategies to prevent implementation of a staffing ratio. Skilled Nursing News describes these strategies as “making a staffing minimum be contingent upon the labor shortage being over, whether non-nursing staff is counted in the minimum limit, and funding for the endeavor” and, as already approved by AHCA’s Board of Directors, the threat of litigation. McKnight’s Long-Term Care News reports LeadingAge’s related proposal to create a certification system allowing providers to attest to their inability to hire staff.
Our Response to AHCA’s and LeadingAge’s Campaign
The two national nursing home trade associations’ arguments in opposition to a meaningful staffing ratio do not withstand scrutiny.
The labor shortage is not universal and does not reflect the absence of people who are able and willing to work. Facilities that treat their workers well do not experience the same shortages of workers. In addition, many nurses employed by staffing agencies are working in nursing homes. The labor shortage reflects nurses’ choosing not to work in nursing facilities as employees. Most significantly, however, as AHCA itself reports, many care settings other than nursing homes have seen their staffing return to pre-pandemic levels. Workers are choosing not to return to nursing facilities as employees because of low wages, lack of benefits, poor working conditions, insufficient staffing levels, and more.
In “President Biden: Count Only Nursing Staff in Nurse Staffing Ratios,” the Center has written about why only licensed nurses and certified nurse aides should be counted in a nurse staffing ratio.
Finally, overwhelming evidence shows that, for many facilities, existing reimbursement can pay for increased staffing levels. Money has been diverted from resident care to owners’ and operators’ pockets as profits for far too long.
The Medicare Payment Advisory Commission (MedPAC) reported in March 2023 that Medicare margins in skilled nursing facilities have exceeded 10% for 22 consecutive years and were 17.2% for freestanding facilities in 2021.
The Medicaid and CHIP Payment and Access Commission (MACPAC) reported in March 2023 that 20% of facilities have more than 100% of their costs fully met by Medicaid base payment rates alone (and facilities get much more than base payment rates). MACPAC also reported that without greater transparency about how facilities spend the reimbursement they receive, it cannot determine the actual costs of providing care to residents and whether existing Medicaid payments are adequate or not. See Center Alert “Medicaid and Nursing Homes: Don’t Believe Owners and Operators That All Medicaid Rates Are Too Low.”
Just this month, at least two states have enacted dramatic increases in Medicaid reimbursement for nursing facilities – $900 million in Texas; $300 million in Minnesota, resulting in an additional $1.1 million for each nursing facility in the state.
“Where Do the Billions of Dollars Go? A Look at Nursing Home Related Party Transactions,” a report by the National Consumer Voice for Quality Long-Term Care, describes how facilities hide their profits and make themselves look unprofitable by paying inflated prices to related parties (companies that they own or control).
Eighteen state Attorneys General call for greater transparency and accountability for public reimbursement, discussing the inflated expenses paid by facilities to related parties and the diversion of public reimbursement from resident care and citing cases by the New York and Massachusetts State Attorneys General seeking to hold facilities accountable.
New York State nursing facilities challenging a state budget law that requires them to spend 70% of their revenue on resident care and limits profits to 5% argue that, if the law had been in effect in 2019, facilities would have had to return $824 million to the state. Nursing facilities could have increased their staffing levels dramatically with $824 million.
Conclusion
Instead of opposing proposals to improve care and complaining that they cannot possibly hire sufficient staff to provide high quality care to residents, nursing home owners and operators and their trade associations need to embrace the critical changes that are needed. If not, potential residents and staff will choose other long-term care options and the nursing home industry will continue to shrink.
June 15, 2023 – T. Edelman