Frustrated with Medicaid Shortfalls, Nursing Home Providers Turn Directly to Voters for Relief

A group of nursing home owners, vendors, staffers, and families in Massachusetts says it has secured enough signatures to force a referendum in 2020 on a proposal to boost funding for nursing homes — a strategy that may have applicability in other states as skilled nursing providers grapple with solving the math problems presented by low Medicaid reimbursement.

The Boston Globe first reported the news.

The ballot initiative would go before Massachusetts voters in November 2020. As currently worded, the question would ask voters to direct state officials to link MassHealth funds to the cost of providing long-term care as calculated by a formula that would use the financial reports of nursing homes from previous years.

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The Massachusetts Senior Coalition has collected close to 130,000 signatures, Frank Romano, CEO of nursing home operator Essex Group Management and one of the coalition’s organizers, told Skilled Nursing News.

While the SNF profession has seen changes, notably in the acuity of its resident population, the care that nursing facilities provide is essential — and the state budget should reflect that, Romano argued.

“[SNFs] are going to need to be here in the future,” he told SNN. “And there’s got to be a reasonable level of funding for labor costs.”

Essex provides a range of senior living services, including skilled nursing, assisted living and home care.

Like many states, Massachusetts allows individuals and groups to submit proposed legislation directly to voters, so long as they collect the signatures of 80,239 supporters, the Globe noted.

The ballot question was initially certified by the office of Massachusetts attorney general Maura Healey in September. The SNF coalition is still gathering signatures, Romano said, and given that there’s roughly a 20% rejection rate for signatures on such initiatives, the group plans to stop gathering once they reach 130,000.

One of the advantages of using this method is that it demonstrates the public’s support, Romano told SNN. By gathering signatures, the coalition can show what a 2016 poll indicated — that the majority of Massachusetts residents support increased funding for nursing home care and direct care staff.

In January of this year, the Telegram & Gazette of Worcester, Mass. examined the issues with the reimbursement for nursing homes from the state’s Medicaid program, known as MassHealth. That report found MassHealth reimbursement rates were based on 2007 costs, while the portion of nursing home residents on Medicaid rose from 66% in 2011 to 69% in 2017.

Nursing facilities in the Bay State have closed at a rapid rate, with 20 facilities shuttering over the course of 2018 — and 35 more at risk, the Massachusetts Senior Care Association (MSCA) said in April of this year. In addition to the increase in Medicaid residents, nursing providers in the state have seen a decline of $330 million in Medicare reimbursements, MSCA president Tara Gregorio said at the time.

Massachusetts’s state budget, which was approved in July, bolstered SNF funding from MassHealth by $50 million, bringing it to $415.4 million. But according to the Massachusetts Senior Coalition, those funds aren’t enough to stop the stress on the state’s providers.

Staffing, for instance, remains a significant problem, with near-full employment, the presence of multiple Amazon distribution centers in the state, and other workplaces such as Bank of America this year announcing starting wages of $17 an hour.

“In skilled nursing, when our labor costs go up, we have to rely on a rate increase that will compensate us for the increased cost,” Romano told SNN. “In assisted living, I can increase rates to offset the costs of labor, and you can’t do that in skilled nursing.”

But there are several steps that have to take place before voters would decide on the issue. For one thing, Romano is hopeful that between January and June 30 2020, there will be an opportunity to negotiate a deal with the state legislature in the budgetary process.

Given that the state has already given $50 million to ease Medicaid reimbursement pains, he thinks there’s reason to believe they’ll be supportive. The hope is to have the changes included in the state House and Senate budget and then go before the governor. If it’s vetoed, the next step would be to try to override the veto.

“If all that fails, then we go to ballot in November,” Romano said.

The provider coalition is also supporting a bill filed by state Senator Diana DiZoglio in September that would implement a similar method as the ballot calculation for SNF reimbursement from MassHealth.

That bill would require the state to use the reported costs of the calendar year no more than two years before the current rate year as the base when setting rates. The occupancy standard for SNFs would be set at the statewide average of the base year.

The coalition hopes that this bill would get a counter-bill in the House, in addition to the petition, according to Romano.

“We’re just trying to cover all the bases,” he explained. “This is the first time Massachusetts has ever done a ballot initiative petition to cover nursing home costs.”

The coalition was also particularly inspired by the work operators performed in Oklahoma, where operators used social media and coalition-building to build support for a significant increase in Medicaid reimbursement to nursing homes.

Even though that’s ultimately not the route Massachusetts chose, Romano believes that that state’s success has some lessons for providers. For one thing, if the ballot initiative goes to a vote, the coalition will be launching a major social media campaign, he said.

For another, not every state allows ballot initiatives, and for providers who can’t go to voters for signatures, using social media and grassroots action will be essential.

“I think providers are struggling with the labor problem. Their backs are to the wall,” Romano told SNN. “And they’re looking for every alternative they can to get their funding. That’s what it boils down to.”

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