Funding for nursing homes serving the state’s most vulnerable elderly populations will increase by $240 million next fiscal year as part of the state’s recently passed budget.
Of that $240 million, which will be split between the state and federal government, $70 million will be directly appropriated to help nursing homes meet minimum staffing requirements. An additional $170 million will update the reimbursement formula for support costs such as food, utilities, maintenance and equipment.
Advocates for the nursing home industry said the added funding will help stem a tide of 20-plus skilled- and intermediate-care facility closures that occurred over the past five years because of crippling budget cuts and decades-old Medicaid reimbursement rates.
“This money means survival,” said Pat Comstock, executive director of the nursing home advocacy group Health Care Council of Illinois. “Our members are thrilled, but they’re also relieved because these dollars are going to provide some much-needed relief from the struggles to survive that members are experiencing.”
The legislation also creates fines for nursing homes that fail to meet staffing minimums and provides safeguards against the use of psychotropic drugs. Labor and senior care advocates said this will help hold nursing homes accountable and make life better for workers and patients.
“Nursing home workers deserve a safe and secure work environment where caregivers are not constantly overburdened, exhausted and stressed trying to care for sometimes up to 30 or 40 residents, if not more, at a single time,” Greg Kelley, president of the SEIU Healthcare Illinois union, said in a statement. “This victory to stop short staffing in Illinois is nothing short of historic for our state’s nursing home workforce.”
Accounting firm Plante Moran conducted a study last year that showed Illinois’ Medicaid reimbursement rate ranked 49th in the nation, and nursing homes lost about $15,000 a year – or an average of $41 a day – for each Medicaid-funded patient. The added
$240 million will help fill an estimated $649 million single-year funding shortfall, according to the study.
The $70 million for nurse staffing will be distributed by a funding formula to be decided by the Department of Healthcare and Family Services. That formula will drive greater funding to the nursing homes with more Medicaid bed days.
Nursing homes will be required to develop and submit an individualized staffing plan to DHFS, and must submit quarterly reports to demonstrate the funding is used satisfactorily. Those that do not use the money according to approved plans risk losing funding in the future.
“So a facility that may be struggling to meet the current staffing ratios will first put money in to bring that facility up to or exceed the staffing ratios,” Comstock said.
Once staffing minimums are met, leftover funds can be used for other staffing matters, such as increasing wages or benefits to increase retention or hiring more staff to lighten workloads.
The $170 million for support costs would update reimbursement rates currently determined by costs dating back to 2004. The distribution formula still is to be determined, but $37 million of that sum will be used to ensure facilities will not lose funding as a result of the new formula.
The accountability measures would direct DHFS to obtain payroll data and levy fines based on the number of hours a facility is short of statutory staffing minimums. The first fines would be issued starting in 2021.
Facilities also would be required to advertise any short-staffing violations on their websites and at public entryways, lobbies and registration desks.
The measure also would require informed consent from either a patient or their guardian before psychotropic drugs can be administered.
The senior advocacy group AARP advocated for greater regulation on the use of psychotropic drugs, releasing a study last year that showed Illinois has the second-worst rate in the nation for giving antipsychotic drugs without a psychiatric diagnosis.
At a Capitol news conference earlier this year, AARP and nursing home workers said these drugs often are administered at homes that are understaffed in an effort to keep patients sedated so they are more manageable for staff.
The budget implementation plan is Senate Bill 1814.