An operator based in a state mired by lower reimbursement rates found a way to turn the tables by utilizing Green House homes, which are part of a reimagined long-term care housing project that is focused on not only better living quarters, but innovative staffing approaches, lobbying the state legislature, and advising on greater community integration.

Such is the story of Jill Wilson, President and CEO of Otterbein SeniorLife, who faced challenges – like many with skilled nursing facilities – during the Covid-19 pandemic. During a webinar discussion, she shed light on how Otterbein SeniorLife overcame the financial struggles and operational hurdles it encountered using the assistance of the Center for Innovation (CFI), a parent of the Green House Project (GHP).

“We have a big investment in skilled nursing, not just in our Green House homes, but also in our retirement communities,” Wilson said. “Currently we operate 1,110 nursing home units, 521 assisted living units, and 444 apartments, which are more of a socialized, assisted living and – less of a medical model.”

The Green House homes are developed by GHP, a non-profit that advises on making facilities more home-like and integrated in the communities they serve. GHP also has a formal partnership with the Pioneer Network, which proposes culture change in long-term care, helping care providers to transition away from a medical and institutional model of care to one that is patient-centered.

Wilson said the organization’s pioneering effort in constructing the Green House homes as licensed Medicaid and Medicare certified nursing homes had an impact on both reimbursement and quality of life for residents.  These Green House homes feature a universal worker design, where elder assistants handle various tasks alongside licensed professionals like nurses, dieticians, and therapists.

Otterbein SeniorLife has five locations across Ohio, with a single location in Indiana. It runs continuing care retirement communities (CCRCs), and its services include independent living, assisted living, skilled nursing and respite care.

“When I think about liberating elders and those who serve them from the mindset of institutional care, this simplest example of a man desiring his wife to be able to make him potato salad again comes to mind, and to me that’s powerful,” Wilson said.

By transitioning most skilled nursing to private rooms, Wilson said she was able to address financial challenges associated with Medicaid rates that do not differentiate between room types.

Workforce development initiatives

Wilson said the pandemic had a profound impact on skilled nursing facilities, emphasizing the financial strain they experienced due to labor shortages and insufficient Medicaid rates. The core issues revolved around the high costs of providing care, exacerbated by the skyrocketing labor expenses incurred during the health crisis.

A pivotal initiative was the establishment of the Otterbein Workforce Department, a dedicated entity designed to reimagine workforce management. Wilson detailed the recruitment of key personnel, including a Vice President of Workforce, centered on ensuring a high-quality workforce aligned with the organization’s mission, and a Director of Workforce Management and Scheduling, who brought expertise from the retail sector, contributing to a shift from rigid position control to a more flexible workforce structure.

Furthermore, Otterbein SeniorLife ventured into the staffing agency domain with the creation of “Mega Pool,” a distinct business line aimed at tapping into a broader pool of workers. The agency not only addressed immediate staffing needs but also provided valuable insights for workforce management, Wilson said.

“We transitioned from a very rigid position control structure to a very flexible workforce structure that offers flexibility and then we also recruited a director to start up a staffing agency to tap into a group of workers who were already filling our shifts,” Wilson said. “And while some of those agency folks we didn’t care for very much, there were a lot of them that we really liked.”

This multifaceted approach resulted in increased stability and a noteworthy reduction in the overall labor cost for nurses and aides, Wilson said.

Inadequate Medicaid rates

Despite making significant strides in workforce management, Wilson addressed the lingering challenge of inadequate Medicaid rates set by the Ohio State Legislature.

Wilson discussed significant changes in the payment system for skilled nursing facilities in Ohio. According to Wilson, the state introduced a new approach to rebasing costs, particularly in direct care, where 40% of the rebasing would be distributed uniformly across facilities, regardless of quality. This change was considered controversial but was ultimately approved, she said.

Furthermore, a notable addition to the payment structure was the introduction of an add-on for private rooms, with rates remaining the same across the state. Wilson emphasized that this was a substantial departure from the previous system, which primarily normalized rates based on averages, with some consideration for acuity through RUGs (Resource Utilization Groups).

Wilson highlighted the lobbying efforts made to secure these changes, as the new system enabled facilities to receive Medicaid rates reflective of their quality, occupancy, and private room offerings.

Wilson said that Otterbein has performed exceptionally well under the new system.

“At Otterbein we were able to differentiate ourselves by getting 38% more than the statewide [average] in quality points,” she said. “And again, if this system didn’t exist, you know, we would be at the average of everyone else”.

This translated to a significant financial advantage, with an estimated $2.3 million in additional payments due to the quality points, she said.

“I think we would all agree that a private room deserves more payment than a shared room,” she said. “[So if the state had not adjusted] we would not be in this situation we’re in. So, it’s a new day for Otterbein.”