Posts Tagged ‘mathis’

Nevada Skilled Nursing Industry Faces Ongoing Economic Challenges After Legislative Session

By Sean Whaley | 4:53 pm July 21st, 2011

Editor’s note: The information in paragraph four of this story is incomplete. While there has not been a state general fund-supported rate increase for the skilled nursing industry in the past decade, rate increases have been implemented. Skilled nursing rates have increased from about $122 per day in fiscal year 2003 to $189 per day in fiscal year 2011, according to the state Department of Health and Human Services. The increases have been funded through an industry provider tax.

CARSON CITY – Nevada’s skilled nursing homes avoided the deepest cuts initially proposed by the Sandoval administration to pay for serving Medicaid clients, but the reimbursement rate is still inadequate to cover actual costs, an industry official said today.

The industry is also concerned that any resolution to the federal deficit discussions under way in Washington, DC, could further exacerbate the economic challenges facing it, said Daniel Mathis, chief executive officer of the Nevada Health Care Association.

Gov. Brian Sandoval originally proposed a cut in the reimbursement rate of $20 per Medicaid patient per day for the state’s four dozen free-standing skilled nursing facilities, but the final budget deal resulted in only a $5 per day reduction. Even so, Mathis said the reimbursement rate has now grown to about $19 a day below actual cost.

“We’re happy that it ended at $5, not $20, but still, for an industry that hasn’t had a rate increase for Medicaid in 10 years, this is going to have some negative impact,” he said.

Evergreen Carson City Health & Rehabilitation Center. / Photo: Sean Whaley, Nevada News Bureau

At the $20 per day cut initially proposed by Sandoval, the industry estimated that as many as five facilities would close, reducing access to skilled nursing beds by Nevada’s elderly.

Charles Duarte, administrator of the Nevada Division of Health Care Financing and Policy, which manages the state Medicaid program, said 34 nursing facilities are appealing their reimbursement rates and so he could not comment on their concerns.

Mathis said the industry is only expecting further cuts as a result of any agreement at the national level to address the federal deficit. Because of the uncertainty over Medicare and Medicaid funding at the federal level, Nevada’s skilled nursing facility operators are in a wait and see mode as to what they will do in response, he said.

“Until providers know exactly what the rate is going to be I doubt there (are) going to be any announcements or change of programming right now,” Mathis said.

The federal debt discussions refer to reductions in entitlement programs, but that translates to cuts in services to the elderly and disabled, he said.

Duarte said the federal discussions have included a possible reduction in federal reimbursement rates through a provider tax levied in Nevada on the skilled nursing facilities, but the indications were it would not happen right away.

“The discussion I’ve heard is that that won’t happen for perhaps as long as five years,” he said. “That it will start being ratcheted down. But of course we’re not privy to the latest information coming out of Washington, so there may be other things that are being discussed that have more dramatic and immediate impacts on not just nursing homes but provider payments.”

One of those is a potential change in the Federal Medical Assistance Percentages (FMAP) that provides matching funds for state Medicaid programs. The match rate for each state is based on average household income.

If the rate is adjusted it will be to achieve budget savings at the federal level, which would likely result in more program costs being passed onto the states, Duarte said.

The National Governor’s Association has sent a letter expressing concerns to the president and Congress that costs will be shifted to the states as the result of any Medicaid cuts that are part of a deficit deal.

Audio clips:

Daniel Mathis, chief executive officer of the Nevada Health Care Association, says the smaller Medicaid reimbursement cut will still have an impact:

072111Mathis1 :16 some negative impact.”

Mathis says Nevada skilled nursing facilities are waiting to see what a federal deficit deal will mean to the industry:

072111Mathis2 :10 programming right now.”

Charles Duarte, administrator of the Nevada Division of Health Care Financing and Policy, says some federal cuts that are part of a deficit deal may not take effect right away:

072111Duarte1 :24 but provider payments.”

Duarte says there is a concern that a federal deficit deal will pass costs on to the states:

072111Duarte2 :10 ill afford it.”


Proposed Medicaid Cuts To Skilled Nursing Homes Would Require Closures, Layoffs, Industry Officials Say

By Sean Whaley | 6:41 am March 22nd, 2011

CARSON CITY – Representatives of Nevada’s skilled nursing home industry say up to five facilities could close and 700 beds lost if a proposal in Gov. Brian Sandoval’s budget to cut the Medicaid reimbursement rate by $20 a day per patient comes to pass.

The closures would result in well-paid medical professionals being laid off and joining the ranks of Nevada’s already sizable population of unemployed, industry officials say.

It could also cause crowding problems in acute care hospitals because there would be no room in nursing facilities to take the seniors who are ready for release.

The reduction in reimbursement is one of several Medicaid rate decreases proposed for many types of medical providers as a way to help balance Sandoval’s proposed $5.8 billion general fund budget.

The skilled nursing reductions would save nearly $10 million over two years. All the Medicaid rate reductions to all medical providers would save nearly $60 million in total over the same period.

Donna Henderson, regional operations manager for Evergreen Health Care, which has five facilities in Nevada, said she does not expect to close any buildings. But layoffs are likely and Medicaid admissions will have to be capped if the cuts take effect, she said.

“It is better for me to have empty beds than Medicaid patients,” Henderson said. “We have not had a rate increase in Nevada in over nine years. I’ve been in the business for 32 years. These are dark times for long-term care.”

While her two facilities in Carson, one in Gardnerville, one in Ely and one in Pahrump are expected to remain open if the reimbursement rate cut takes effect, Henderson said she does believe there are other facilities in the state that will have to close their doors.

“They just won’t be able to operate under those conditions,” she said.

Daniel Mathis, chief executive officer for the Nevada Health Care Association, said the Medicaid reimbursement rate right now is $12 below cost, on average, for the skilled nursing industry in Nevada. Add another $20 reduction and the industry faces tough choices, he said.

“There is a business decision that has to be made by the providers: do they want to accept that patient,” Mathis said. “Because they are looking at if they do, they are going to lose money and be held accountable for providing care for that patient, and if they don’t their census will drop and their operation will fail that way as well.”

Charles Perry, president and government affairs liaison for the association, which represents Nevada’s long-term care industry, said it is an access to care issue. When hospitals have elderly patients ready for discharge, it is the skilled nursing industry that frequently takes them to provide a lower cost of care as they continue their recovery, he said.

“We are the hospitals’ safety-relief valve,” Perry said. “Now if we can’t take the patient out of the acute care hospital, that creates a problem within the hospital.”

Perry declined to name the facilities he expects will have to close if the rate decrease takes effect, saying to identify them would create panic for residents, their families and staff. The status of the reductions won’t be known until the Legislature finishes the budget in late May, he said.

“I can tell you there will be a large impact, if it comes to pass, in the rural areas,” Perry said.

Mike Willden, director of the Department of Health and Human Services, rejected the idea that rural nursing facilities would be forced to close if the rate reduction is implemented. Those rural facilities that are part of an acute care hospital are not affected by the proposed reduction but are reimbursed for their costs, he said.

The rate reduction would affect the 47 or so free standing skilled nursing facilities operated in urban areas of the state, Willden said. The agency does not have a lot of data on the profitability of the skilled nursing facilities, he said.

“I don’t know if they are making a profit or not,” Willden said. “I assume heretofore they have made a living or there wouldn’t be 47 facilities in business.”

Willden did note that the number of Medicaid recipients receiving care in a skilled nursing facility has remained stable over the past eight years at about 3,100 residents. Much of that has to do with providing less costly care in less restrictive settings, including the use of adult day care and home health care aides, he said.

These efforts are in keeping with a landmark 1999 U.S. Supreme Court decision called Olmstead, which requires minimal use of institutionalization, Willden said. An independent consultant in 2010 found that Nevada has been, “one of the leading states in the country in its commitment to Olmstead.”

Perry said the association is meeting with the hospitals as well to present a united front against the reimbursement rate reductions.

“We don’t want to get into a situation where we’re pitting provider against provider,” Perry said.

Darrin Cook, vice president of clinical and operational services for Fundamental, which has a number of facilities in Nevada, said the payment reduction could create a domino effect from layoffs to decreased quality of care to increased violations identified by state and federal regulators.

Patient care could suffer, and that would not do anyone any good, he said.

“It could mean closures, staff reductions, pay reductions,” Cook said.

Audio clips:

Charles Perry of the Nevada Health Care Association says skilled nursing facilities are the relief valve for hospitals:

032211Perry1 :25 within the hospital.”

Perry says naming the facilities that could close would create unrest:

032211Perry2 :11 unrest and uncertainty.”

Perry says if the rate decrease is approved, it would affect rural areas of the state:

032211Perry3 :09 the rural areas.”

Darrin Cook of Fundamental says the rate decrease could mean staff reductions and pay reductions:

032211Cook1 :11 in the country.”

Daniel Mathis, CEO of the Health Care Association, says the reduction will force providers to make difficult business decisions:

032211Mathis1 :22 as well, so.”