‘Still Not Recovered’: Signature, Good Sam, AHCA Leaders Lay Out Top Policy Concerns for Sector

Staffing troubles – amid inadequate federal funding for the skilled nursing industry – are at crisis point and leading to ever-increasing facility closures, while nursing homes are having to refuse patient referrals from hospitals.

As they look to attack these problems with some new and old approaches it will be crucial to get the federal government’s help on expediting and increasing immigrant visas, improving funding and doing away with outdated rules such as the 3-day hospital stay requirement, provider and advocacy organization leaders said last week at Skilled Nursing News’ CLINICAL event in Washington, D.C..

Tom Syverson, Director of Government and External Affairs at the Evangelical Lutheran Good Samaritan Society, said that he hasn’t seen a staffing crisis like the one skilled nursing is currently facing in the 36 years he has worked in health care.

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Given that 70% of Good Samaritan’s facilities are located in rural areas, Syverson said that his organization is especially hard hit with staffing woes and coming up with solutions will require some creativity, saying, “[T]here are so many dynamics that are impacting our work across the country. And it isn’t a one size fits all issue.”

It’s been difficult to recruit workers for starters, Syverson said.

“Currently, we have 2,000 open positions in our organization,” he said, noting that this is only 100 fewer openings than a year ago. “So, it’s not improving.”

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Last week, Good Samaritan closed its 13th facility in the last 18 months, all but one of which were located in small, rural communities. Syverson said the closures and staffing shortages are amounting to an access crisis on the acute care side, where hospitals cannot discharge patients.

“We had one patient in one of our hospitals that was there for over 200 days,” he said. “What kind of quality of life is that for a person? But what are the incentives for skilled nursing facility providers to take those admissions when you do not have staff?”

He added that since operators do not have the level of provider relief funds they had during the height of the pandemic, many cannot afford to hire agency staff.

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Permanent repeal of the three-day hospital waiver

Although industry leaders have made their case for extending the three-day hospital waiver, the program is set to expire on May 11th.

CMS clarified Tuesday that patients already in place in a facility will not be held to the 3-day stay rule unless there is a break in their stay beyond the deadline. Also, any new cases after the deadline will require a hospital stay.

Prior to the pandemic, a patient needed to have a three-day inpatient hospital stay before Medicare would cover the SNF stay that followed. The rule was established in 1965 to make sure patients were in the best possible setting for care. However, many operators have voiced that it is an outdated policy.

Industry stakeholders have said the rule can lead to expensive Medicare denials, sometimes over technical distinctions, since hospitals can admit seniors for observation, a distinction that doesn’t fit in the Medicare mold.

Kathy Gallin, vice president of legislative affairs and health policy at Signature HealthCARE, told Skilled Nursing News that having a waiver in place during the pandemic was instrumental to Signature, because it allowed the company to keep taking patients at a time when hospitals desperately needed to discharge patients.

Gallin said that the pandemic has proven that it is time for an updated policy, although since it would need to be approved by Congress, she is not sure when the industry will see a change.

“After 58 years of this rule, it is time for this to go away,” she said.

Michael Bassett, vice president at the American Health Care Association (AHCA), the industry’s largest trade group, said that there is support for ending the 3-Day stay rule at the congressional level.

“I think if you look at Congress bipartisanly, they read that this is an outdated policy,” Bassett said. “It hasn’t kept up with the modernization of health care and how to deliver it, certainly not helping [deliver] personalized care [for] individuals where they need it and when they need it. So I think the will is there.”

Since any sort of permanent implementation of these waivers would need to be carried out through Congress, he said, the issue will boil down to what the Congressional Budget Office (CBO) thinks it will cost.

“We’re hopeful that once we are able to analyze the data so it can show that it’s an outdated policy, that it’s hurting the beneficiary, that is needlessly increasing their co-pays” a case can be made to do away with it, Bassett said.

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Proposed payment updates for 2024

Other concerns top of mind for operators attending SNN’s CLINICAL event included the Centers for Medicare & Medicaid Services’ (CMS) proposed payment update. Earlier this month, CMS issued a payment rate update to skilled nursing facility (SNF) reimbursements for fiscal 2024, which includes a net increase of 3.7%, or approximately $1.2 billion, in Medicare Part A payments to SNFs.

The rate increase reflects a $2 billion increase resulting from the 6.1% net market basket update to the payment rates, based on a 2.7% SNF market basket increase plus a 3.6% market basket forecast error adjustment and minus a 0.2% productivity adjustment.

While the rate increase was welcomed, operators believe more funding will be required to meet the needs of the day.

“With inflationary costs, with labor costs and everything that we are facing on a daily basis, 3.7% is really very minimal,” Gallin said. “I think it’s time that they really looked at this a little bit more closely. But we are thankful, we’re very grateful that [the increase] was given and we will forge ahead to see that we get an increase even at the state levels.”

For his part, Syverson acknowledged the significance of the increase, but said that he worries that it won’t be enough. The size of the rate increase in the proposed payment update might even reflect CMS’ lack of understanding of the sector’s problems, he said.

“We’re finally starting to see in some of our states where, when access becomes an issue, we start to see Medicaid rates increase,” he said. “Is that what it’s going to take is complete knowledge of the sector, before we see meaningful financial support?”

Still, there were other proposed changes that Syverson noted he liked, such as bringing resident satisfaction into the payment process through the Quality Reporting Program.

Meanwhile, Bassett said that as the industry makes the transition to the Patient Driven Payment Model (PDPM), CMS has been helpful by responding to industry concerns and phasing in payment adjustments to maintain budget neutrality.

“We made the transition to a different payment system, which has to be budget neutral,” he said. “We realized that it wasn’t in certain areas, and so [CMS] would have removed some money from the system. And they could have taken all of that last year. But they split it up over the two years, which allowed positive updates for those two years.”

Immigration reform

In discussing solutions to the staffing crisis, panelists urged looking into an old solution – recruiting immigrant nurses.

Syverson said his team at Good Samaritan is in the process of recruiting 800 internationally trained nurses for acute and post-acute care facilities.

Yet, as of last week, Congress capped the number of visa applications for internationally trained nurses, meaning applicants who haven’t already begun the process may need to wait until 2025 to apply.

“So unless your international nurses already had their green card processed by June of last year, they are not claimed,” he said. “So we are losing 45% of those nurses that would have come this year.”

Basset said that Congress needs to create a health care specific visa for nurses and CNAs, because the need is so great.

Senators Kyrsten Sinema of Arizona and Thom Tillis of North Carolina have sponsored a bi-partisan bill that would ease up immigration restrictions, which Bassett said AHCA is in support of.

“They’re trying to come up with practical immigration reform,” he said. “We have had meetings with them, we’ve sent them these ideas. And you know, we’re hopeful. This is something that’s been going on for way too long.”

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