NurseWeek: Medi-cuts Hit Home: Nursing homes struggle to stay afloat with shrinking Medicare payments and understaffed facilities

Medi-cuts hit home
Nursing homes struggle to stay afloat with shrinking Medicare payments and understaffed facilities

By Cathryn Domrose
October 2, 2000
Photo: Photodisc

Many nurses believe the minimum suggested staffing levels in a government report are not enough to deliver proper care, especially to a patient population that is growing increasingly sicker.


	You've read the article. Now tell us what you think. Related sites American Health Care Association National Citizen's Coaltiion for Nursing Home Reform Gerontological Nursing Ventures The Gerontologist Seeking relief To help nursing homes deal with staff shortages, Congress is considering legislation that would allow facilities to hire uncertified workers to feed, transport and organize activities for residents. Most nursing home administrators support the bill proposed by Rep. Paul Ryan, R-Wis., saying it would give nurses and nursing assistants more time to spend with patients who require special care. But a number of health professionals warn that such a law encourages nursing homes to replace or substitute certified nursing assistants with part-time and temporary workers who may have less training, and could dilute the quality of care in nursing homes. "It lets them reduce training, pay their staff less and hire for less," said Charlene Harrington, Ph.D., RN, FAAN, a professor in the school of nursing at the University of California, San Francisco. The legislation would require these "single-task" workers to complete a state-approved training program, work under the supervision of a nurse and work only with those residents with whom they are trained. The single-task workers could not be included in any required minimum staffing limits for nursing homes. To avoid dehydration and malnutrition among elderly residents, nursing homes need more workers at mealtimes, said Robert Greenwood, spokesman for the American Association of Homes and Services for the Aging. Homes in Wisconsin use single-task workers successfully at meals, he said. "They’ve provided a lot of social interaction and allowed the nurses aides to pay attention to those who have problems swallowing." In a letter to Rep. Dick Armey, R-Texas, House majority leader, health educators expressed fears that the single-task workers could easily be assigned to jobs for which they are not qualified. Educators also contended that the legislation encouraged a "task-oriented approach, while ignoring the needs and preferences of the whole resident." Workers might need 75 hours of training on nutrition and feeding alone to ensure proper care, the letter stated, and many nursing homes do not have enough licensed nurses to supervise and train the new workers. The letter was signed by 13 health educators, including professors from Texas A&M University System Health Sciences Center in College Station and the director of the Center on Aging at UCLA. ~ Cathryn Domrose

The elderly woman lying in a nursing home bed, pushing a call bell and desperately waiting for a nurse or an aide isn’t thinking about Medicare and Medicaid. She doesn’t know that Medicare cuts in 1997 took the nursing home industry by surprise, forcing chains that represented one in 10 homes to file for bankruptcy. She doesn’t know about a Health Care Financing Administration report that says 54 percent of nursing homes do not have enough staff to meet a minimum standard of care.

She isn’t wondering whether this is because nursing homes do not receive enough money from the government, because they mismanage the money they do receive, or both.

All she knows – pushing the button again and again – is that she is not receiving the care she thought she had paid for with years of her hard-earned tax dollars.

Although nearly 1.6 million Americans reside in about 17,000 nursing homes across the country, most people don’t like to think about the subject. But recent events, including the bankruptcies and the staffing report, have brought nursing homes out of the musty attic and into the limelight of Capitol Hill.

In September, President Clinton proposed giving $1 billion in Medicaid grants to states during the next five years to increase staffing at nursing homes. Congress has reinstated about $2.7 billion in Medicare cuts and is expected to increase Medicare payments again this year.

While nursing home operators and reform advocates welcome the money and new attention for an often-neglected segment of the population, the two sides have different ideas about why the crisis has occurred and what should be done to fix it.

Medicare cuts
In the Balanced Budget Act of 1997, the government changed the way it billed nursing homes for patients with Medicare insurance. Instead of allowing unlimited charges for therapy, medications and other ancillary services, the new rule created a fixed, per-patient charge. Anything the homes didn’t spend, they kept as profit.

At first, nursing homes welcomed this change, said Tom Burke, spokesman for the American Health Care Association, which represents 12,000 nonprofit and for-profit long-term care providers in the United States. But when the new payment system was implemented, it caused financial problems for homes with large numbers of Medicare patients, he said.

Five major chains representing about 1,800 homes have filed for bankruptcy. Although most of the homes remain open while they rearrange their finances, some have closed or laid off employees, according to media reports. Burke said he was not aware that any homes had closed.

When the government decided to stem free-flowing Medicare funds, the till drawer shut hard on the hands of the now-bankrupt chains, industry critics and government officials say. Most of the bankrupt chains had spent large amounts of money acquiring nursing homes and therapy companies during the mid-1990s, according to a report by the General Accounting Office released in September.

In 1998, Medicare payments to skilled nursing facilities reached a record $13.6 billion, or an average of $268 per patient per day, more than double what they had been in 1991.

"They were trying to expand their Medicare patient base," said Sarah Greene Burger, MPH, RN, director of special projects for the National Citizens’ Coalition for Nursing Home Reform. "Essentially what they were trying to do was to please their investors, not provide services for their residents."

Industry defenders contend the bankrupt chains were unfairly punished for focusing on Medicare patients, who must come directly from hospitals and often need more costly care than other residents. In the 1980s, Burke said, nursing homes were encouraged to provide therapy services for Medicare patients, so many invested heavily in buying or creating therapy companies.

"We think they made appropriate business decisions based on the Medicare payment situation," Burke said. "With the Balanced Budget Act of 1997, the government changed the rules."

The new payment system was supposed to slice $9 billion from Medicare, he said. Instead, it has cut more than $16 billion. Although Congress has removed the spending cap for therapy services and restored some funds, nursing home representatives say the new per diem rate does not accurately reflect the cost of patient care, especially for critically ill patients.

As a result, they say, nursing homes will be forced to turn away costlier, critically ill patients.

Nursing home companies in bankruptcy must prove patients will not have access to nursing home care before Congress approves any more money for them, said Sen. Chuck Grassley, R-Iowa, chairman of the Senate Special Committee on Aging. Grassley has asked the GAO to study how nursing homes have spent the $39 billion in federal money they receive through Medicare and Medicaid.

Nursing homes receive about half their revenue from Medicaid and about 10 percent from Medicare. That report is due early next year.

Staffing shortages
Perhaps even more disturbing to those involved with nursing homes than the bankruptcies is a government report that shows that more than half of the nation’s homes do not have enough nurses aides and nearly one-third do not have enough registered nurses to ensure minimum care of residents.

"It shocked me," said Joanne Wilson, MS, RN, a gerontological nurse who owns Joanne Wilson’s Gerontological Nursing Ventures, PA, a nursing home consulting service in Laurel, Md.

Because Maryland has strict staffing laws, Wilson said, the homes she works with meet the minimum levels suggested in the government report. But that does not mean they have an easy time finding nurses and aides.

It’s getting more and more difficult to find people willing to work with ill, elderly people, she said. "Most of our homes have shortages in one form or another."

Many nurses believe the minimum suggested levels in the government report are not enough to deliver proper care, especially to a patient population that is growing increasingly sicker. The report suggests each resident in a home receive a minimum of two hours’ care from nurses aides, 12 minutes from registered nurses, and 45 minutes from RNs and LPNs combined, for a total of 2.75 hours of staff time.

"We think those standards are just way too low," said Charlene Harrington, Ph.D., RN, FAAN, a professor in the social and behavioral sciences department at the University of California, San Francisco, School of Nursing.

In a study published by The Gerontologist, Harrington and other experts suggested minimum levels of 2.7 hours for nursing assistants, 0.7 hours for LPVNs and 1.15 hours for registered nurses, for a total of about 4.5 staff hours per resident per day. To achieve such levels, the federal government would have to spend between two and three times the $1 billion that Clinton has proposed, she said.

Harrington also is concerned that money for staffing might be diverted to administrative costs or profits if the nursing homes are not carefully monitored.

Burke said nursing homes welcome the idea of minimum staffing levels, although he, too, thinks the suggested minimums in the government report are too low.

"We believe it needs to be paid for, too," he said. "If you want to regulate it and require it, you have to pay for it."

During the past few years, Wilson and nurse consultant Sandra Reed-Bryant, RN, said they have noticed increasing complaints from nursing home residents – they are unable to reach an aide or they have to go to the bathroom and cannot get assistance. One of Reed-Bryant’s greatest fears is that the financial stresses of nursing homes – no matter what the cause – will take their toll on the frustrated, overworked employees at the bedside.

"My concern is that they may take it out on the residents," she said. "I think it’s something we all have to be vigilant for."