New CNA, LPN Contracts Raise Nursing Home Wages Across United States

Nursing home operators across multiple states have raised wages for certified nursing assistants and licensed practical nurses, thanks to a combination of union actions, post-pandemic market dynamics and public policy shifts.

But with operators still facing acute financial pressures, raising wages is not a simple matter.

Larger structural changes are needed to support higher wages across the skilled nursing workforce. Industry groups such as the American Health Care Association (AHCA) have floated such proposals, emphasizing that nursing homes face “a legitimate crisis.”

Actions from coast to coast

The move to raise nursing home pay rates got a big boost recently, through a landmark contract between Oregon-based Avamere and Service Employees International Union (SEIU) 503.

The April agreement provided some Avamere workers with as much as a 30% wage increase — the floor wage for CNAs was set at $18, with pay increases for CNA2 certification and a chance to renegotiate wages every year. The average U.S. hourly rate for CNAs is $17.22, according to data collected by online job platform CareListings. LPNs are paid on average $29.47 per hour.

Avamere is the state’s largest nursing home chain with 41 facilities; the operator has 33 SNFs across 4 states.

Mid-May, Empress became the fourth nursing home chain with facilities in Oregon to raise its CNA wage to $18 an hour, following Vancouver, Wa.-based Prestige Care Inc. and Avalon Health Care headquartered in Salt Lake City, Utah.

The Empress contract bumped CPA wages by 20% to 30%, the company said in a statement.

On the other side of the country, Connecticut’s iCare Health Network — facing looming nursing home strikes — followed suit around the same time in May, settling on $20 per hour minimum wage for CNAs and $30 for licensed practical nurses.

ICare workers also received a pension and additional funding to cover health care insurance costs and wellness programs as part of the four-year agreement.

SEIU District 1199 NE, which represents health care employees in the New England area, has settled wage contracts with Pennsylvania-based Genesis HealthCare and Autumn Lake HealthCare headquartered in Howell, New Jersey, for facilities in Connecticut, among other operators.

The four-year contracts are still pending ratification, a spokesperson for the union said, and nothing has been publicly issued. In line with iCare, agreements garnered $20 for CNAs and $30 for LPNs.

“NAHCA is always worried about these situations because in not too many other places are people’s lives at stake,” said Lori Porter, co-founder and chief executive of the National Association of Health Care Assistants, referring to the strikes. “We’re not in an assembly line … and with staffing the way it is, the temporary agencies, there’s just no one to replace CNAs.”

Added Porter: “Between the industry and government, there has to be a wage increase for CNAs now.”

Indeed, despite recent wins, worker groups are still actively pursuing higher pay.

A notice issued May 13 notified the public that strikes weren’t averted but reset for a later date “to allow more time for further negotiations,” the union said.

In the same statement, new strike notices were announced for June 7 at iCare, Genesis and Autumn Lake group homes.

More recently, group home workers at Oak Hill, Whole Life, Sunrise, Network, Mosaic and Journey Found in Connecticut nabbed a $184-million agreement state funding package for the next two years — a substantial step toward the SEIU District 1199’s $20 minimum wage goal for such workers.

Poised for a change

The pandemic has put the spotlight on nursing homes across the nation, Skoczulek and Porter said, giving workers in the space, mainly through unions, a chance to demand better wages and benefits.

“We’re acutely aware that [SNF workers] went through a very, very difficult year, they lost some of their colleagues; we’re in the epicenter of it,” said David Skoczulek, vice president of business development for iCare. “We and the state of Connecticut had to do something pretty big, to get the industry — at least in the next couple of years — set up, to be able to pay better and to staff better and keep the quality of care.”

Porter said she often gets asked why CNAs don’t just pick up and choose another profession, since the wages have been historically low. Her answer — the position’s social ties.

“What happens to CNAs is they’re taken advantage of; they have a relationship with their patients,” explained Porter. “It’s like walking off from your own loved one.”

Porter was a CNA for seven years before turning to marketing and admissions, then administration.

“We’re delighted that any provider believes they have the budget in which to increase wages as significantly as to $20 an hour. That sends a wonderful message, a powerful message, to all nursing home providers across the nation,” noted Porter.

But raising wages isn’t simply a matter of increasing labor budgets, given that most nursing homes are heavily dependent on Medicaid reimbursement rates set by state authorities. Without Medicaid increases, increasing pay is often difficult or impossible.

“The 10,000-foot view is that there’s some serious structural issues in Connecticut specifically, and in most states across the country as well, where the industry has been underfunded,” said Skoczulek. “The margins are razor thin … it is an extraordinarily regulated business. Having come from other parts of health care, I was staggered by how regulated it is.”

Adding to the structural dilemmas, some states are also requiring higher staffing levels.

Coupled with wage contracts coming out of the state, the Connecticut Senate passed a bill at the end of May requiring an increase in skilled nursing facility staffing levels: at least three hours of direct care per resident per day, up from 1.9 hours.

Rhode Island is a couple steps ahead. Gov. Dan McKee on May 27 signed into law its own staffing mandate for SNFs, requiring at least 3.58 hours of direct nursing care per resident, per day, starting Jan. 1.

The iCare representative said there needs to be continued financial support from Medicare and Medicaid, state and federal backing, to make this a national trend. He hopes wage increases will help with future recruiting initiatives and find the best people to care for residents.

“I think it created some serious discussions and a little bit of change in the trajectory of the industry,” added Skoczulek. “This was a negotiation between the owners and operators and the union.”

Connecticut Gov. Ned Lamont in early May made a financial offer to avert more strikes in the state as part of his budget, including a $267 million two-year package to fund 4.5% raises for all nursing homes, not just those threatening to strike.

According to a report from the the CT Mirror, $20 million would be reserved as a one-time enhancement to retirement benefits, $12.5 million funds hazard pay bonuses, and $13.5 million for enhanced training and staff development.

Lamont tacked on a 10% increase in facility Medicaid rates with $86 million between this July and March 2022, mostly to make up for lost revenues and unforeseen pandemic expenses.

“In my opinion, every CNA in America should be considered a state employee, so should everyone who works in a nursing home, when their reimbursement is well over 70%,” added Porter.

On June 2, AHCA — the national industry association — issued a call for Congress to take action on a national level to help alleviate the nursing home workforce crisis, noting that May’s labor report showed a drop of 19,500 nursing and residential care jobs.

The organization is pushing for the Care for Our Seniors Act, which includes provisions such as providing student loan forgiveness, licensed clinical professionals who join long-term care after graduating, and providing career ladder scholarships to help frontline caregivers progress to more advanced clinical roles.

“The lynchpin in addressing this workforce crisis is the need to adequately fund long term care, especially through Medicaid,” AHCA noted in a press release. “Currently, the majority of nursing home residents rely on the program, yet it only covers 70 to 80 percent of the actual cost required to provide daily care … The Care For Our Seniors Act also includes short and long-term solutions to ensure that Medicaid properly reimburses long term care providers, so they can better support our frontline caregivers.”

Wage contracts and staff shortages

The NAHCA exec said staffing shortages, at least for CNAs, won’t be addressed just by wages alone: she points to workforce culture as another deterrent.

“That’s what drives most CNAs out of the profession. It’s never been the money. It’s never been the residents. It’s the treatment, the non-value,” said Porter. “It’s treated as a job when it is not a job, because trust me, there are far easier jobs. And everyone is hiring.”

Once CNAs are treated in a way that matches their worth, Porter added, more people will want to become CNAs.

Furthermore, drawing more CNAs to the sector is essential for maintaining and improving care quality. If no other CNAs are available, it’s hard to terminate an underperforming team member. Porter knows of some homes that have only two employed CNAs.

“Not two per shift. Two,” she said.

CNAs make up 37% of employees per nursing home, according to the U.S. Department of Labor Statistics. LPNs, by comparison, account for 13% of a facility’s workforce.

“The ability to recruit is going to come down to the ability to pay and the ability to make an environment that’s desirable to work in,” added Skoluczek. “Hopefully this does give us a greater ability to recruit and continue to find high quality employees to care for our residents.”