Facing unprecedented financial and labor challenges and regulators proposing unrealistic standards, skilled nursing providers have no choice but to change how they operate — or they risk failure.
“I use this analogy of Wayne Gretzky – you’ve gotta skate to where the puck is going. That’s what I see us needing to do now. If we stay put and do what we have always done, we’re going to fail,” North Shore Healthcare Owner and Partner David Mills said during Skilled Nursing News’ Clinical Executive Conference.
The bad news is that it might be hard to tell where the puck is going, given uncertainty around nursing home reforms proposed earlier this year, as well as looming Medicare payment cuts.
In particular, the Biden administration’s minimum staffing ratio outlined in a reform initiative late February has been top of mind for providers and industry leaders.
The staffing minimum ratio proposal is a “knee-jerk reaction” and “regressive” response from the Biden administration, one that may have good intentions but will not solve the problem, said Dr. David Gifford, chief medical officer for the American Health Care Association (AHCA).
The good news is that company culture is completely within the control of nursing home operators, according to Mills.
“Oftentimes when people leave, it’s because they’re not supported, they’re not listened to, they’re not valued,” Mills said. “The beauty of that is, that’s completely within our control. I can’t necessarily control Covid or some of the regulatory requirements.”
Mills, Giffordand VIUM Capital Managing Director and Head of Government Relations Scott Tittle spoke about how SNFs can redefine clinical excellence while looking out for the latest quality and outcomes measures.
‘You can’t get blood out of a stone’
While discussing the potential for a federal staffing minimum ratio as it relates to the current staffing crisis, Gifford likened it to the old saying: “You can’t get blood out of a stone.”
In other words, the Biden administration is attempting to create better quality of care, but given the staffing crisis it will be a difficult, if not impossible burden for facilities to bear.
“Most people would like to have more staffing or different types of staffing. The problem is, we’re not approaching it from a comprehensive look,” said Gifford. “If we really want to increase staffing, we need to create incentives for people to work here.”
Tax credits and loan forgiveness, for people that work in the sector, along with creating federally qualified health centers is a start, Gifford said. Incentives to go to school for post-acute care and gerontology is key too, with graduates “sopped up” in other health care sectors.
“We said that we needed more primary care physicians, particularly in the rural parts of the country, so [the government supplied] loan forgiveness for primary care physicians,” said Gifford. “To me, the response to nursing homes represents ageism in this country. We don’t respect the elderly in this country and so we’re not going to get the resources.”
Readily available daycare options for staff – and financial incentives from the government to support such endeavors – is another way to approach the staffing crisis comprehensively, Gifford added.
“You need the other incentives and [CMS is] not looking at that broad equation … what’s even worse is it forces us into a dialogue, debating this,” he said.
A narrow approach costs industry leaders and their lobbying representatives a chance to talk about other staffing incentives they should be doing to improve quality of care, Gifford said.
Such incentives “…are now off the table, which to me is disappointing,” he said.
Physician and director of nursing (DON) retention means needed staff support filters down to direct care staff positions, Mills added, and in turn retention for those professionals as well.
“When we had our greatest success, we had between 6% and 8% [doctor, director of nursing] turnover,” Mills said. “There was a level of stability, there was a level of trust. The bar went up every year, we held each other accountable and that was the kind of culture that we created.”
It’s very difficult to replicate this culture in today’s environment, Mills said, but North Shore continues to strive for these standards.
In fact, it will make the problem worse, he said, driving up costs while the mandate itself remains unfunded by federal dollars.
“It is not compensation alone,” added Mills. “Certainly we need to be competitive within the markets that we operate, but I do think it comes down to culture. You have to not only develop trust and commitment, but do it with high integrity, set very clear expectations.”
Staffing minimums through a financial lens
Financial fallout from a staffing minimum ratio concerns Tittle – between the proposed 4.6% cut to the Patient-Driven Payment Model (PDPM) and cost associated with mandatory staffing minimum ratios, it’s puzzling why the Biden administration would introduce such changes now.
“Why now? What’s the goal here? It’s not going to improve quality, it’s only going to strain operators already struggling,” said Tittle.
One of VIUM’s clients, a small SNF operator in Atlanta, Ga., runs on 60% agency use currently, Tittle said.
“How is that person, despite their best efforts, going to comply with a national staffing requirement? I think one size fits all … [it’s] not going to be the solution here,” said Tittle.
Panelists were curious to see how such mandates at the state level will play out, with New York’s minimum staffing ratio finally starting in April after three delays to the executive order.
“Even the state of New York is acknowledging that maybe the people aren’t there,” added Tittle.
Illinois implemented what Tittle called an “innovative approach”’ to their Medicaid reform, with funding behind the state’s staffing minimum efforts.
As part of the state budget, Illinois Gov. JB Pritzker approved a $700 million increase to nursing home funding in the state, set to take effect July 1.
The $700 million is broken down as follows: $290 million to $350 million toward staffing incentives; $70 million toward a new quality program; $83 million for CNA compensation and support workforce retention, tenure, promotion and training; $34 million to end rural reimbursement rate disparities; $52 million to transition from Resource Utilization Groups (RUG-IV) to Patient Driven Payment Model (PDPM); and $170 million to boost base Medicaid reimbursement.
“I think a lot of states will be watching that to see, is that something we could work in at a more localized level, as opposed to something out of [the Centers for Medicare & Medicaid Services, CMS],” added Tittle.
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