Hartford, Conn. The nation’s nursing homes are perilously close to laying off workers, cutting services — possibly even closing — because of a perfect storm wallop from the recession and deep federal and state government spending cuts, industry experts say.
A Medicare rate adjustment that cuts an estimated $16 billion in nursing home funding over the next 10 years was enacted at week’s end by the federal Centers for Medicare and Medicaid Services — on top of state-level cuts or flat-funding that already had the industry reeling.
And Congress is debating slashing billions more in Medicare funding as part of health care reform.
Add it all up, and the nursing home industry is headed for a crisis, industry officials say.
“We can foresee the possibility of nursing homes having to close their doors,” said David Hebert, a senior vice president at the American Health Care Association. “I certainly foresee that we’ll have to let staff go.”
The funding crisis comes as the nation’s baby boomers age ever closer toward needing nursing home care. The nation’s 16,000 nursing homes housed 1.85 million people last year, up from 1.79 million in 2007, U.S. Census Bureau figures show.
Already this year, 24 states have cut funding for nursing home care and other health services needed by low-income people who are elderly or disabled, according to the Center on Budget and Policy Priorities, a nonprofit research firm based in Washington, D.C.
Some facilities are now closed because of money problems — including four in Connecticut — and others have laid off workers because of what industry officials say are inadequate Medicaid reimbursement rates.
Medicare cuts are troubling, they say, because the higher Medicare reimbursements have been used to compensate for the lower Medicaid rates.
“We’re really teetering on the edge of what we see as the collapse of the long-term care system,” said Deborah Chernoff, a spokeswoman for District 1199 of the New England Health Care Employees Union in Connecticut, which represents more than 20,000 health care workers in the state.
The problem reaches across the country. In January, even the Motion Picture & Television Fund said it would close a hospital and nursing home in Woodland Hills, Calif., founded to care for actors and other entertainment industry workers because of financial losses.