Nursing Home Owners:  We Can’t Afford MassHealth

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Nursing home owners say they are losing money taking care of MassHealth recipients and are hoping lawmakers, many of whom have publicly expressed support to boost what nursing homes are paid, will finally take action.

Legislative efforts to increase what MassHealth pays nursing home facilities have failed in the recent past, including last year, and some health care experts predict a similar fate for the current legislation given that MassHealth is facing a projected $300 million shortfall this year. Currently MassHealth, which is the state’s version of Medicaid makes up roughly 40 percent of state spending.

Nursing homes in Massachusetts are losing $37 a day for each MassHealth patient they serve, according to industry advocates.

“For nearly a decade, the state’s Medicaid payments to reimburse homes hasn’t kept up,” Rich Bane owner of five South Shore nursing facilities, wrote in an op-ed in The Patriot Ledger. “If you were running a business that had been losing money for years, you’d think about shutting it down. And that’s exactly the predicament that many in our profession find themselves in.”

There are 420 nursing homes in Massachusetts making up $4.3 billion of the state economy, according to the Massachusetts Senior Care Association. Roughly 40,000 residents being served by about 77,000 health workers, the association says.

“Several, perhaps dozens, of nursing homes in the state are on the verge of closing. That would mean the loss of thousands of jobs, not to mention hundreds of our frail elderly being displaced or relocated, making it harder for their loved ones to visit close to home,” Bane wrote.

Most workers at nursing homes “do not make a living wage”, Bane wrote. “That’s the sad truth. …Most of us would say they deserve yeoman’s pay for the work they do and the peace of mind they give us.”

A nurse who has worked in nursing homes on Cape Cod for more than 20 years says the facility she currently works at has been recruiting for some non-skilled positions at local addiction-recovery halfway houses. The turnover rate has climbed tremendously, and often those trying to overcome their own alcohol and drug abuse are not ready for the dedication needed to be helpful in a nursing home setting.

“The type of people they can recruit has really gone downhill over the last few years,” she said, speaking on the condition of anonymity.

A slew of lawmakers have publicly signed on to support several bills that are currently being reviewed by the state Legislature’s Joint Committee on Elderly Affairs. A bill sponsored by state Representative Tom Golden, a Lowell Democrat, would boost MassHealth reimbursements to nursing homes and set up state grants and scholarships to educate those looking to get into providing health care to the elderly, both in nursing homes and as in-home health aides. There are two Senate bills that address these issues as well.  

“The Nursing Facility Stabilization bill is needed to address decades of MassHealth underfunding for quality nursing facility care,” Massachusetts Senior Care Association president Tara Gregorio, wrote in an email message to New Boston Post last week. “Massachusetts ranks 4th worst in the Nation for funding nursing facility care.  Since 70% of nursing facility residents have their care paid for by MassHealth, a facility’s ability to invest in quality resident care and staff is entirely dependent upon state funding.”

Despite the public display of support to boost payments to nursing homes from lawmakers in several regional newspapers this week, a health care expert at Boston’s Pioneer Institute, a conservative think tank, predicts the bills are dead on arrival.

“It is unlikely, that with MassHealth now over 40% of the state budget and growing and the state is facing a $300 million hole this year, rates will be increased,” said Joseph Archambault, of the Pioneer Institute, in an interview with New Boston Post last week. “Generally speaking nursing homes are some of the most expensive services that [MassHealth] pays for in the state.”

There are three ways to pay for nursing home care. One is out of pocket — but it costs an average of roughly $130,000 a year in eastern Massachusetts, which can quickly deplete assets. Another is through long-term care insurance, which most people don’t have and which can be difficult and expensive for older people to get. (It’s relatively cheap for younger people; but most younger people don’t want it.)

The third way is to rely on MassHealth, the state’s Medicaid-subsidized health insurance program for poor people — but to qualify for MassHealth a patient has to be low on assets and income.

When asked if part of the problem is that many families have had to choose between paying for private insurance or figuring out a way to structure family assets so elderly relatives will qualify for MassHealth, Archambault replied, “We need to figure out a way to get more individuals on private, long-term insurance to protect Medicaid [MassHealth] resources for the truly needy. There are many layers to this.”


Andrew C. Nelson has worked as a reporter for several newspapers in New England.