Flat Medicaid rates threaten Berks Heim, commissioners told

READING, Pa. - Flat Medicaid bed rates are threatening the existence of county-owned nursing homes like Berks Heim, according to Kelly Andrisano, executive director of the Pennsylvania Coalition of Affiliated Healthcare & Living Communities (PACAH).

At Thursday's meeting of the Berks County commissioners, Andrisano said the trend today is the privatization of county-run nursing homes, and much of that is due to a lack of funding and flat Medicaid reimbursement rates. Currently, there are 18 counties with 21 county-owned nursing homes in Pennsylvania - a significant decrease from a few years ago.

Every year, the state sets the Medicaid rate, and in Pennsylvania, those rates have remained flat, with the last increase of 1.3 percent five years ago. Andrisano said the state budget that came out this week also keeps Medicaid bed rates flat for nursing homes.

"That is the state saying, 'We want to close county nursing homes,'" Commissioner Christian Y. Leinbach said.

With a high population of Medicaid residents, Medicaid is the primary source of revenue for county-owned nursing homes, which are a safety net for many county residents who can’t afford private nursing homes. When that funding remains flat, it becomes very difficult for nursing homes to remain fiscally stable.

In Berks Heim, approximately 80 percent of the beds are paid for by Medicaid. Andrisano said a recent study showed that between the Medicaid rate and what it costs to provide nursing care, Pennsylvania nursing homes are looking at a $25 per day shortfall. Leinbach said that equates to more than $3 million per year for Berks Heim.

Addressing concerns about the efficiency of Berks Heim, Leinbach, said health care inflation in the northeastern part of the U.S. is between 7 and 8 percent every year. Berks Heim's annual inflation rate is only 2.7 percent.

"It is so important, that if you're concerned about the future of your county home, that you write to your legislators and you write to the governor and you write to the secretary of human services, and you say, 'My county health matters to me. Here's why.'"

She said legislators need to hear it from their constituents. Leinbach said those are the only people who can decide to raise the Medicaid rate.

Andrisano said it appears that legislators are beginning to listen as they recently discussed providing funding to nursing homes through inter-governmental transfer (IGT), but this funding is not enough to cover the shortfall most nursing homes are experiencing. The IGT would provide approximately $1 million to Berks County, which is only one-third of the $3 million deficit Berks Heim is facing.

"It's the first indication of new money since Bob Patrizio [Berks County CFO] received the information in early summer that we should plan on five years going out of flat funding." Andrisano said. "It is a good sign, but it is a starting point."

In other business, the commissioners approved an ordinance creating the Mt. Penn Preserve Partnership Council of Governments (MP3 COG); however, Commissioner Mark C. Scott remains opposed to the COG expressing concerns that it has the potential to expose the county to significant financial obligations down the road.

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