Report finds PA nursing homes Medical Assistance underfunded by nearly $1.2B

MECHANICSBURG, Pa. (March 1, 2022) –  LeadingAge PA today announced that Pennsylvania’s nursing homes were underfunded by nearly $1.2 billion in Medicaid in 2019-2020, according to a report commissioned by the Association. To begin helping address this inequity, LeadingAge PA is calling for state lawmakers to approve a $294 million increase in funding for the 2022-23 state budget.

LeadingAge PA officials and members, joined by Sen. Judy Ward (R-30) and Rep. Pam DeLissio (D-194), unveiled the study by RKL LLP during a press conference at the state Capitol and outlined how nursing homes are still battling the pandemic. Medicaid funding is provided to caregivers to cover costs for those who can no longer afford to pay for it. As one of the oldest states in the nation, Pennsylvania’s nursing homes care for one of the largest Medicaid populations in America. 

“Gross inequities in Medicaid funding for Pennsylvania nursing homes began long before the pandemic and have continued to escalate,” said LeadingAge PA Interim President and CEO Bob Bertolette. “COVID-19 created a dire situation in which some caregivers can no longer afford to fill their beds. In some cases, families who need care for a loved one cannot find it. This funding request should serve as the starting point for providing seniors with the support and care they deserve.”

“This report that LeadingAge PA has recently published shines a bright light on the severity of this issue,” said Ward. “At a Medicaid deficit of over $80 a day per resident our long-term care facilities cannot wait much longer for relief.  If this unsustainable trend continues these facilities may be forced to cut staff, remove beds, or even worse, close down all together. Our long-term care facilities need help. My hope is that my legislation is a step in that direction. I will continue to work with my colleagues in the Senate and House on legislation to provide this much-needed relief to this critical industry.”

Gov. Tom Wolf proposed new funding for nursing homes in his 2022-2023 budget, but links it to facilities meeting the administration’s misguided regulatory proposal to increase minimum staffing thresholds by 50%. Unfortunately, the staffing requirements are unrealistic because they lack funding to hire more employees and, even if they could, there remains a critical worker shortage across the state. More staffing does not necessarily produce better care in many cases. Pennsylvania’s Medicaid reimbursement rate has remained nearly stagnant since 2014, rising only one percent for half of the commonwealth’s providers in the 2018 fiscal budget.

“Our commitment as legislators must be to ensure high quality care, including robust staffing, through a commitment to finally fund this level of care at a level that is sustainable,” said DeLissio. “Our state is currently in a unique financial position to make significant strides toward this goal.  If we fail to move forward in this way, we are jeopardizing the ability of this level of care to continue.”

“We all want our communities to not only survive, but thrive,” said Chuck Quinnan, LeadingAge PA Senior Vice President and Chief of Government Affairs. “It is time to finally address these issues in meaningful and lasting ways because our seniors deserve better. We are advocating for the $294 million to start moving the needle in the direction of providing the critical and necessary support to our long-term care providers to recruit and retain a quality workforce, and the required funding to adequately reimburse providers for the cost of delivering care to residents supported by the Medicaid program.”

The Pennsylvania Medicaid Funding Shortfall for Nursing Facilities report was prepared by leading advisory firm, RKL LLP. To determine the potential gap between nursing home expenses and the reimbursement amount facilities receive through the Medicaid program, RKL’s Senior Living Services Consulting Group developed a custom database using publicly available Medicaid cost reports to conduct granular calculations.

“Pennsylvania’s nursing homes need reliable data to manage the industry’s unique profitability and management challenges,” said Jeffrey E. Boland, CPA, Partner and Leader of RKL’s Senior Living Services Consulting Group. “We’re proud to once again provide LeadingAge PA with an updated assessment of the Medicaid funding shortfall facing Pennsylvania’s nursing home providers.”

“On behalf of LeadingAge PA, our members and families who have loved ones who depend on our care, we would like to thank the state lawmakers who joined us today for their critical support,” Bertolette said. “We also want to thank all those in the General Assembly fighting alongside us to right this tremendous wrong. We must do better.”

View the full report here.

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About LeadingAge PA: 
LeadingAge PA is a trade association representing more than 370 quality senior housing, health care, and community services across the commonwealth. These providers serve more than 75,000 older Pennsylvanians and employ over 50,000 dedicated caregivers on a daily basis. Services our members offer include Life Plan Communities/Continuing Care Retirement Communities, skilled nursing communities, assisted living residences, personal care homes, and affordable senior housing. LeadingAge PA advocates on behalf of our members at the state and local levels to influence positive change and affect a healthy vision for the delivery of quality, affordable and ethical care for Pennsylvania’s seniors. For more information about LeadingAge PA and our envisioned future of senior services, visit  leadingagepa.org.

Media Contact:
La Torre Communications for LeadingAge PA
David La Torre
david@latorrecommunications.com

About RKL:
RKL LLP is a leading advisory firm with offices located in Pennsylvania and beyond. We tap into a wide range of services - tax, accounting, data analytics, operations, human capital management, technology, wealth management and more - to deliver solutions that help organizations and their leaders navigate everyday complexities and get to the next level, however they define it. Fueled by the talent and dedication of nearly 600 professionals, we're consistently ranked among the top firms in the nation and among Pennsylvania's "Best Places to Work." Learn more at rklcpa.com.

Media Contact:
Elizabeth Foose
Communications Manager, RKL
EMFoose@RKLcpa.com