Maine lawmakers made significant headway in tackling the consistent underpayment of the state’s 107 nursing homes, despite the perception they accomplished little this year in a divided government.
Maine’s Medicaid program pays nursing homes based on their audited costs from 2005. That basic payment structure hasn’t changed since 2008, save for a 1.5 percent raise in 2012.
The 7,000 residents of Maine’s nursing homes have some of the most intensive health needs of any nursing home residents in the U.S. Maine nursing homes also need to meet some of the highest staff-to-resident ratios of any state, and they are among the fullest anywhere in the country. But inspections of the state’s nursing homes in 2011 turned up some of the lowest rates of deficiencies in the nation.
That all amounts to a significant expense. In 2013, the average cost for a year of nursing home care in Maine was $98,550 for a resident in a semiprivate room — the national average was $75,405, according to Genworth Financial’s annual survey of long-term care costs.
Medicaid pays the bills for 68 percent of Maine’s 7,000 nursing home residents. Since the homes haven’t effectively received a raise from their dominant payer for six years, the underpayment is catching up in a big way. In 2011, Maine underpaid its nursing homes $29.4 million. In 2012, a 52-bed Calais nursing home with a high portion of Medicaid residents shut its doors, forcing residents to relocate to homes in Lubec, Eastport, Ellsworth and elsewhere.
Starting in July, more money will start flowing to the state’s nursing homes — the result of a broader bill that introduced an important reform in the way nursing homes are paid. In fact, over the next three fiscal years, lawmakers promised nursing homes $38 million more from state and federal funds than they would receive if current funding levels remained in place.
That amount isn’t enough to fill the gap, but it’s progress at a tight time.
Beyond the slight raise, however, the more fundamental change legislators made this year is that Maine law now requires the state to reset its Medicaid rates every two years to reflect nursing homes’ more recent costs. Since Maine law has not had a periodic reset requirement, it has been easy for policymakers to continuously put off rate changes.
The same legislation that made biennial rate changes a part of state law also authorizes a long-term care task force to continue examining the financial condition of nursing homes and the prospects for long-term-care system reforms.
Gov. Paul LePage recently attacked Democrats in the Maine Legislature for neglecting the needs of nursing homes because they rejected his last-minute bill to dig into smoking cessation funds for nursing home money. But the Republican governor played no part in the positive changes legislators were able to make this year for nursing homes. He didn’t sign the bill — fortunately, he didn’t veto it — to make the rate reset part of state law: Its the same bill that provides the first $12 million batch of increased funding and forms the long-term-care task force. And he vetoed the budget package that made the other $26 million funding increase part of the state’s budget baseline.
To top it off, LePage rejected the compromise Democrats offered on his last-minute nursing home bill that would have provided some of the funds he sought for nursing homes on shaky financial footing.
We commend the Legislature for what it was able to accomplish this year in helping to set nursing homes on a sustainable path. Ultimately, it’s our hope policymakers don’t lose sight of the need for a larger shift in long-term care away from expensive facilities and toward more cost-effective solutions at residents’ homes and in their communities.