Nursing homes serve our most vulnerable citizens: frail elders who require complex medical care, 24-hours a day. Today’s greater variety of acute care, rehabilitative and convalescent services that nursing homes provide cannot be delivered elsewhere. Medicaid plays a critical role in the provision of long term care, as nearly 60 percent of the residents cared for in Florida’s nursing homes rely on Medicaid to cover the cost of their long term care services. Those services are in jeopardy if stability is not maintained within the Medicaid program.
In 2009, the Nursing Home Quality Assessment was implemented to help nursing home care avert devastating Medicaid funding cuts. In the last fiscal year, the Assessment has allowed the state to draw down an additional $622.5 million in federal Medicaid dollars to fund nursing home care and has helped the State of Florida save nearly $219 million in General Revenue in the 2010-11 fiscal year.
However, in 2011, nursing homes will experience an automatic rate reduction of $41 million, which results from a change in the state/federal match of the Federal Medical Assistance Program (FMAP). Facilities will no longer have the ability to buy back a portion of the previous year rate reductions through the Quality Assessment program.
FHCA, together with its advocacy partner, Our Florida Promise, will continue actively protect seniors’ access to quality long term care services by opposing any cuts to Medicaid funding for nursing homes. Funding cuts threaten the ability for providers to maintain the workforce needed to care for an ever-growing population of older, more medically complex Floridians. Seventy-percent of nursing homes’ operating expenses go toward wages, benefits and other labor costs. Without adequate funding, vital caregiver jobs could be lost, placing a larger demand on individual workloads, which could result in increased turnover.
Since 2001, Florida has experienced steady improvements to nursing home quality care as a result of tougher regulation, including mandated increased minimum staffing requirements related to the hours of care per resident. Those staffing mandates have resulted in the creation of over 11,000 new Certified Nursing Assistant and 700 new nursing positions. Today, Florida’s nursing homes employ nearly 260,000 direct- and indirect-care workers and support an estimated $20.2 billion of the state’s economic activity.
Additionally, wages and employee benefits, as well as energy, fuel and other vendor costs have increased at rates greater than Medicaid reimbursement. Lack of adequate funding prevents many of our 30+ year old facilities from modernizing their settings in anticipation of a better delivery system for the aging baby boomer population.
Medicare, another significant funding source for long term and post-acute care, covers the first 100 days of nursing home care, with Medicare with Part A fully paying for the first 20 days of care. Like in so many other states, Medicaid underfunds the actual cost of providing quality long term care in Florida, making Medicare funding critical to helping supplement inadequate Medicaid payments.
Over the next ten years, Florida will be experiencing $2.1 billion in cuts to Medicare-funded nursing home care. These cuts include a $1.2 billion cut included in the passage of health care reform and $898.5 million in federal regulatory cuts that went into effect in October 2009.
Together, Medicaid and Medicare pay nearly 80 percent of Florida’s long term care costs. Florida’s nursing homes are a vital part of the long term care system; providing good quality care for our state’s frail elders and as the state’s 14th largest employer, good jobs for Florida workers. Medicare and Medicaid funding are inextricably linked, and the combination of cuts to both programs squeezes Florida’s long term care facilities in a manner harmful to our seniors’ care needs, detrimental to our state’s economy and damaging to our caregiver jobs base.