Nursing homes have been trying for several years to get their state funding restored, eventually suing to regain two consecutive years of 2 percent cuts.
Then came the House Finance Committee budget approved June 8 that contained an 8.5 percent cut to nursing home funds in fiscal 2019.
The prospect of losing that amount in a single year had nursing home operators worried. Deborah Griffin, administrator of the 60-bed Hattie Ide Chafee Nursing Home in East Providence, described the proposed 8.5 percent cut as “catastrophic.”
“There is really no way to absorb that,” Griffin said.
But on June 12 a tentative agreement was announced: In exchange for nursing homes giving up the lawsuit, the budget would be amended to include a 1.5 percent increase in state reimbursement funds starting in July, on top of another 1 percent in October. The latter was what Gov. Gina M. Raimondo’s budget had originally recommended.
The settlement is reasonable, said Virginia Burke, director of the Rhode Island Health Care Association, which represents many of the 84 nursing homes in Rhode Island.
Because the state’s attorney on the nursing home case had failed to file a timely appeal of a recent decision, the government was at risk of having to immediately repay $16 million in cut nursing home reimbursements.
“They [nursing homes] were willing to give up the $16 million they were owed, in return for taking a figure going forward,” Burke said. “We never wanted to blow up the state’s budget.”
Even if the funding moves from an 8.5 percent cut to a 2.5 percent increase, the financial struggles of nursing homes will likely continue.
They have been reeling from several years of sustained cuts to state reimbursements initially made in fiscal 2016.
The crashing of the Unified Health Infrastructure Project has compounded the financial problems, according to nursing home administrators and advocates.
James Nyberg, director of LeadingAge RI, which represents 15 nonprofit, independent nursing homes in Rhode Island, said chronic underfunding has taken a toll.
“They are still underfunded, in general, with the years of rate freezes and rate cuts, and UHIP,” he said.
The new computer system has meant several years of substantial delays in state payments to nursing homes, uncertainty as to who qualifies for state-supported Medicaid and conflicting information about patient copays.
Nursing home residents are incorrectly informed by the state system that they don’t pay a copay for their services, yet the state deducts that amount from the reimbursements it sends to nursing homes, Burke said.
“We’re not like a store with 1,000 different customers that pay us. We provide care that is either funded through Medicaid or Medicare, and very little else,” Burke said. “UHIP has messed that up considerably.”