Communicare Sees Behavioral, Mental Services as Solution to Low SNF Occupancy — But Payment Lags Behind

Fighting opioid addiction has been a major health care priority over the last decade, and at least one provider in the skilled nursing space says there are options for care at the state level — options that the SNF could help provide.

But, at least for now, the regulatory landscape hasn’t caught up to the problem.

There’s precedent for the connection between skilled nursing facilities and these patients: The problem of residents with behavioral health issues and substance use disorders has loomed large in recent years, to the point that a top nursing home official at the Centers for Medicare & Medicaid Services (CMS) described this population as the second-most widespread concern for providers, behind staffing.


It’s a problem that has its roots in the de-institutionalization of care for people with mental health and behavioral health issues, Fred Stratmann, the general counsel at the Communicare Family of Companies, told SNN on the most recent episode of the “Rethink” podcast.

With 87 SNFs in Indiana, Ohio, Missouri, Maryland, Virginia, West Virginia, and Pennsylvania — and three adult psychiatric facilities that focus on geriatric and adult psychiatric needs in the acute setting — the Cincinnati-based Communicare has seen the impact of the care gap for this patient population firsthand.

On “Rethink,” Stratmann talked about some of the solutions that might help more operators serve this population, and why SNFs are in a good place to help some of those affected by the growing crisis in this field — despite persistent payment and regulatory challenges on the state level.


Can you talk about the issue of caring for patients with behavioral health or substance use disorders, and what you’re seeing in terms of the impact of the problem?

This is an area of health care that I think is being ignored, in large part. A lot of nursing home patients in certain areas, especially in the Medicaid space, tend to be people with behaviors, with mental illness, or with some comorbidity with substance use disorder. And when you look at the patients with behavioral health issues or mental illness, years ago — back in the 1990s, when they de-institutionalized people with behavioral health and mental health issues — the thought was that people would return home and receive their services in the community.

And what ended up happening is that many did not, and we’re seeing them either in the nursing home space, or they’re showing up in our psychiatric facilities. They tend to cycle between psychiatric hospitals, emergency rooms, homeless shelters, and jail. It’s an unfortunate byproduct of de-institutionalization, in that the community supports are not really meeting the needs.

So in order to fill that gap, nursing homes kind of became the placement choice for this population, and it’s our company’s opinion — and we’ve certainly looked into this issue and tried to make some advancements on this issue and about how to deal with this population group — because I don’t know, and we as a company don’t necessarily believe, that a nursing home is the best place for someone who’s got behaviors, who’s got mental health issues, who may be a danger to themselves or others. So we’ve looked at a lot of different models as to how the nursing home industry is dealing with it.

The federal government has what they call the [Institutions for Mental Diseases] (IMD) exclusion. It basically prevents you from having more than half of your population in a nursing home … with a predominant behavioral health or mental illness designation. You’re basically running a mental health institution.

There’s an exclusion to that, because they don’t want to create a situation where there are now mentally ill or people with behavioral health problems basically being warehoused in nursing homes. Now that exclusion, as a matter of operational necessity — both from the community standpoint, from the government standpoint — is ignored. I think there are buildings in every, every community that have a predominant population of people with behaviors and mental illness.

But we’re not giving them the best care possible. We’re not doing anything to try and break that cycle that they have of either being in nursing homes or being in hospitals or homeless shelters or jails. We looked at what the [Department of Veterans Affairs] (VA) does, and I know that a lot of people have issues with the way that the VA provides care. But I think this is one aspect of the VA system that is actually working.

Through their homeless prevention programs, they have domiciliaries, which provide stable housing — which is so critical — medical attention when it’s needed, meals, programming, social services, and activities to keep homeless veterans who may have behavioral health issues or mental health issues out of homelessness, and kind of give them a productive life, as much as possible.

So we looked at the idea of creating this kind of an institution in the Medicare/Medicaid system. And we’ve approached state governments in Ohio and Indiana and Maryland about doing that — about having specialized nursing homes with this population as your service group and giving them the services that they need, that are not necessarily consistent with nursing home services.

We want to make sure that their medication is being managed. We want to make sure that they have stable housing and meals and physical care when they need it. But we also want to make sure that we’re trying to meet their needs. So we developed programming that focuses on life skills — on managing yourself in a community situation, grocery shopping, managing your finances, grooming, just those kinds of skills that may be able to help them over the long term.

I don’t know that you’re going to immediately break that cycle of dependence and homelessness, but we’re going to try. We’re going to give it a shot; we’re going to put a situation in place for them that will give them an opportunity to do so, rather than just putting them in nursing homes, and almost forgetting about them.

These patients, how do they end up in the nursing home in the first place? Is it just a lack of places for them to go, and maybe the fact that they need some of the services that a nursing home can provide?

Yes. In the long-term care setting, they may end up there because they’ve got physical ailments that prevent them from from working or living independently. And those are comorbidities that come from either substance use or behavioral health issues. Then, when they come to a nursing home — either on a short stay or on a long-term stay — what will happen is that we realize, and they realize, that the nursing home setting may not be the best, most appropriate care for them. But there isn’t a placement for them.

Then the rules regarding a nursing home discharge is that they have to have a safe and appropriate location to which you discharge them. And if there aren’t these services available in the community — and in most communities, there are not enough to meet the demand — they end up staying in the nursing homes.

The regulations that SNFs deal with are geared toward the geriatric population, which is quite different from this one. I know Communicare has worked on the regulations and systems in place — can you go into some of this work?

Well, the response from government agencies is that we’re leaning in the right direction, but we’re not proposing the right thing for them. I think everybody recognizes that the behavioral, mental health, and substance use populations— there is a great need for services. We’ve done a couple of different proposals; we’ve proposed state waivers for state Medicaid departments to allow us to have buildings that are a 100% behavior population and recognized as such.

It’s not kind of ignoring that IMD exclusion anymore, it’s kind of asking for a waiver from it, so that we can provide predominantly behavioral health services to the population. Maybe re-certify them quarterly or within every 90 days, saying: They still require these services, and this is the best care setting for them at this time.

We’ve also proposed allowing adult day services, which Medicaid does not cover in the behavioral health space, to be provided to this group. We created a concept of finding a housing partner so that people can live independently in the community, but they’ll check into an adult day program three to five times a week so they can receive any medical attention they need — they can receive counseling, they can receive any therapy that they need. And they can have activities that are designed to help them succeed in the community.

Then the last one that we propose really focuses in on the substance use population. When you look at states like Ohio and Indiana that have high nursing home vacancy rates — Ohio’s vacancy rate is about 15%, 16%, Indiana is about 24%, 25%. We wanted to create a regulatory structure that would incentivize nursing home owners to turn their excess capacity into residential substance use treatment by having an expedited certificate-of-need process that would allow — instead of taking a year to 18 months for a new nursing home bed to get online or a new substance use bed to come online — that we could actually have it done within six months.

We’ve presented these plans to the two state governments. Again, while they agree that there’s a need for these services, they’re not really receptive to being the first one to try this kind of a waiver.

Do you have a sense of why that’s the case?

I’m not sure exactly why. I think that they recognize that there is a need. Everyone’s told us that there is a need. They’ve told us that it’s an interesting concept.

But they’re concerned about that gray area between. A nursing home in most states is governed by the state department of health. In Ohio, you know, there’s a separate agency for mental health and there’s different regulations, different rules for obtaining your CON certification. So when you have this crossover between different governmental entities, maybe there’s a suspicion that we’re trying to slide into a gray areas and avoid any type of certification or regulation.

That could be one reason why they’re not embracing the idea. I think that, you know, as a social commentary, while there’s a lot of attention being paid nationally, and definitely at the state level, to the opioid crisis, it’s come at the expense of a growing need to address the behavioral health and mental health crisis nationally.

I’m assuming the problems of caring for this population aren’t confined to Indiana and Ohio.

No. I think the issues with the behavioral health population are everywhere. The entire country de-institutionalized mental health. They closed the large state psychiatric hospitals with the goal of putting people back into thee community and localizing their treatment and their care. Then what happened is they they failed to keep up by providing the appropriate level of services for them.

On the substance use side, the opioid crisis is is huge in Ohio. It’s huge in Indiana. It’s tremendously invasive in West Virginia, and then even in Maryland, there is a significant cost of the opioid crisis. When you look at the social costs — which is the lost economic opportunity, the additional costs of hospitalization and treatment, the cost on the criminal justice system, all those social costs — states that have the highest per-capita burden from the opioid crisis are Maryland, West Virginia, Ohio, and Indiana is a little bit further down.

But they’re all significant players in that, and they’re all seeing the social cost, the economic impact, and the burdens that it places on the entire health care system and, to a certain extent, the criminal justice system.

Why are nursing homes in a good position to provide some help for these crises? What are some of their strengths?

The first one that I think is most obvious to me is that we’re already treating them. We have evolved from a population where 30 years ago, people didn’t need a lot of care but just couldn’t manage themselves independently, and they maybe needed a little more close attention medically.

Then you could see, as time goes by, that nursing homes are seeing people with greater health needs; the acuity has gone up. Then you also have the behavioral health population, where this is the only place where people are able to receive the medical and the residential care they need. So we’re already treating this population. But also when it comes to states like Indiana and Ohio, we have bandwidth. We have empty beds — we have entire facilities.

We’re familiar with the population. We’ve got the physical structure, the infrastructure in terms of the buildings; the buildings are already meeting regulations for residential care. It’s kind of a win-win.

What do you think is going to happen with this population as time goes on, and how will it tie in with the ongoing evolution of the skilled nursing world?

The skilled nursing industry is really in a difficult spot right now. We were told that the silver tsunami, as the baby boomers start to age out, that’s coming. And there’s a lot of operators who are hanging on, you know, operating at very thin margins and barely making it, with the hope that in five, 10 years, we’re going to see a large increase in that 75-plus population group that is going to need nursing services.

And that’s going to happen; we’re aware that’s going to happen and that we’re kind of in — I think they call it the population donut hole or something right now.

But this behavioral health population is not going to go away, and I don’t know that it’s going to diminish. The unfortunate thing is that as a statistically independent demographic group, we’re not following them; we’re not checking the growth in it. Substance use, we are tracking, so we know that that is still growing. I think states are making progress in addressing opioid deaths and overdoses, which is phenomenal. Obviously, there’s still too many.

But what’s going to happen as a result of the side effect of a large population with long term substance-use issues — they’re going to have physical issues. And there are bound to be — though I’m not a clinician — mental health and behavioral issues that result from long-term substance abuse. So I think the behavioral and substance-use populations are going to continue to grow. And then if and when the silver tsunami comes, there’s really going to be a lot of competition for space in nursing homes.

And we’re at a point now where a lot of states have excess nursing home capacity. We’re looking at the possibility of having far too little supply for the demand that’s going to be out there.

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