Nursing homes may get boost from new tax

By ANNE KAZMIERCZAK
Register Reporter

Come Thursday, Iola nursing homes and residential care facilities should be floating a little higher financially.
That’s the date the state is set to reinstate a 10 percent cut to Medicaid paymets to such facilities.
The money will come from a new tax on nursing home beds.
According to a release by the Kansas Health Institute, “If the initiative wins federal approval, the tax would remain in place for three years. In the fourth year, it will be reduced by at least 40 percent. After the fourth year, it would expire if not renewed by lawmakers. ... The law calls for using the first year’s revenue to restore the 10 percent cut in Medicaid, dating back to Jan. 1. ... In the second, third and fourth years, most of the money would be used raise Medicaid reimbursement in ways intended to cause homes to hire more direct care staff. About $10 million would be set aside for projects aimed at improving quality of care.”
Few homes in Iola had heard about the new measure, however, and none knew if the tax would apply to Medicaid beds as well as those paid for by Medicare or private insurance.
All, though, were certain of one thing.
“That cut drastically hurt us,” said Peggy Strong, executive director of Tara Gardens residential care faciltiy.
“The state barely gives you enough money to survive on, to make payroll.” The reimbursement reinstatement will help, she said.
Half of Tara’s beds — 11 of 22 — are occupied by Medicaid patients.
Medicaid pays a flat rate to each nursing home, based on the number of Medicaid clients they house and the type of care provided those individuals.
At Tara, losing funds on half their beds was critical. They had somthing of a safety net, however, in that Humboldt’s Arrowowod Lane is owned and adminsitered by the same company, Strong said. There, only 5 of the 22 beds are Medicaid-paid.
“One building covers the other,” Strong said. But, “We’re just robbing Peter to pay Paul.”
As the health care crises worsens and costs continue to skyrocket, “more and more people are going to state assistance,” Strong noted. “We’re even seeing more of our private pay go that way.”
It’s the same elsewhere.
“It crippled us,” Jody Monsour, owner/operator of Fountian Villa said of the reduction implemtned earlier this year. “They called it a 10 percent cut, but basically they didin’t pay us what they owed.”
Monsour noted he recieves only $38 a day from Medicaid to cover one patient. “We take her to the hospital. We give her all her medications. I’m basically giving her care for free,” he said of the payment that doesn’t cover the cost of staff time provided.
Not only that, Monsour noted, but “the state has doubled every (annual) fee you would pay to them. My liscensure — which normally runs $400 — went to $800. My bed fees went from $600 to $1,200.”
Libality insurance was even worse, he said. “My insurance liablity went from $35 to $500 per bed,” Monosur said.
“At the same time,” he said, “all the services were cut. All the departments were cut. All the people who I used to confer with for information were cut. It’s really getting bad out there.”
Hopefully, Monsour conceded, restoring the 10 percent cut will be enough.
“When I take a Medicaid patient, I look at their plan of care,” he said. What sort of care does the client need? What medications? All are writen up in the plan, Monsour said. Then, “The state looks at what (the individual) can afford to pay — that’s called the client obligation.” Medicaid is supposed to pay the balance between the cost of care and the client’ s abilty to pay.
“There’s sometimes I can’t take them,” because the reimbursment rate is too low, he said.

MEDICAID payments are “a per diem that is established quarterly,” Joe Benter of Iola Nursing Center explained. He said that care costs sometimes increase before the Medicaid payment is adjusted. If a patient needs more intensive care before the next quarterly adjustment, the nursing home must cover that care on its own.
The per diem is set for the entire facility, not adjusted per client, he noted. But, “If you spend money improving your building, you’re reimbursed at a higher rate,” Benter said.
Medicare — a federal program — “is considered skilled care — that’s reimbursed at a higher rate,” Benter said. While Medicare payments come from the federal government, Medicaid funding “is thorugh the state,” he said.
There are no Medicare patients at Iola Nursing Center. Of 37 filled beds, 24 are Medicaid clients; 12 beds are empty.
Guest Home Estates, the asisited living side of INC, has 49 beds. Twenty are currently occupied. None are paid for by Medicaid.
Fountian Villa has 17 residents. Ten of those are Meidcaid clients. There are 20 beds total.
Statewide, a 55 percent Medicaid case load per residential center is the average.
Previously, Monsour noted, his Medicaid load was less than 25 percent. “Now we’re at 50 percent. People we had who were self-pay have slid into Medicaid as they’ve used up their resources.”
“Medicaid is going to be a necessity (for more individuals) as prices rise and insurance covers less” Monsour noted.
“I’m starting to get 40-year-olds in my place — it’s scaring me.” Younger platients may have drug abuse or obesity issues that disallow them from living on their own, Monsour said.
“Medicaid has to cover them” if they cannot afford to pay for their own care, he noted.
At Windsor Place, half of the 52 clients are supported by Medicaid, noted bookkeeepr Charelen Merriman. There are a total of 60 beds available at the skilled nursing home, she said.
To deal with the reduced reimbursent earlier in the year, “we actually cut (staff’s) rate of pay,” Merriman said. It was that or cut positions, she noted.
The hope is the new bed tax will allow the agencies “to get more money from the federal government,” Benter said.
“The state would tax the nursing home, and more money would flow into the federal system, then the state (is) supposed to pass that back down to the nursing homes,” he explained.
“I’ll beleive it when I see it,” he said.
To survive, Benter said, “You just try to run as lean and tight a ship as possible,” he said. “Staffing is the least flexible. You look at food and recreation” when needing to cut costs, he noted. “You have to be creative.”
“It still comes down to this,” said Monsour, “It’s all taxpayer money.”

July 2010