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Commentary / State Medicaid reimbursement


Nursing-home patients put last

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By Brendan Williams
Published:

As if the Washington Supreme Court's McCleary decision on education funding was not enough of a sword of Damocles hanging over legislators, the court's decisions have made it clear the state is falling short on health funding.
In April the court found the state violated its “implied duty of good faith and fair dealing” by effectively requiring home care workers to “perform necessary services without compensation.” The award for back-pay was $57.1 million. This month the court disallowed the state's “psychiatric boarding” practices, writing that “(p)atients may not be warehoused without treatment because of lack of funds.” And the hits keep on coming: On Aug. 21 the court found the state wrongfully denied health benefits to its own workers, causing workers to “postpone needed health care.”
Washington is getting to the point where juries are making far more rational health care policy than policymakers are. This backdrop of liability makes state Medicaid reimbursement for nursing homes even more alarming.
It is bad enough that the Legislature has, year after year, avoided “rebasing” to account for nursing home care costs incurred more recently than 2007. The 2007 cost year is being used to reimburse through at least June 30, 2015.
Worse, even within that stingy construct games are played. In 2011, the Legislature granted the Department of Social and Health Services the ability to make up measures of patient acuity as it sees fit; allowing it to “adjust the case mix index for any of the lowest ten resource utilization group categories ... to any case mix index” that might help drive people out of nursing homes. Adding insult to injury, permitting this phony math came in the context of assessing providers with a fee to partly-offset the state's own cost in making mediocre Medicaid payments.
Beyond seemingly allowing the state itself to commit Medicaid fraud, the 2011 change failed to acknowledge patients have a right to stay in the nursing home care setting. Under state law, it is illegal “(t)o discharge a patient from a nursing home because of his or her status as a Medicaid recipient.” Further, “(i)f a resident chooses to remain in the nursing facility,” state law requires that DSHS “shall respect that choice, provided that if the resident is a Medicaid recipient, the resident continues to require a nursing facility level of care.”
In other words, arbitrarily reducing reimbursement for lower-acuity patients even below a 2007 cost basis simply worsens devastating Medicaid payment shortfalls, because many of those patients, most of whom are quite elderly, will choose to continue aging-in-place in nursing home settings. Medicaid shortfalls, then, are passed on to private-paying patients and cause them to, in subsidizing Medicaid patients, “spend down” and become Medicaid patients themselves (shame on them, apparently, for having saved toward the costs of their future infirmity). It is a vicious cycle.
Presently there are just over 10,000 Medicaid patients in nursing homes. This is down from over 13,000 when I ran a nursing home association a decade ago. Because the state's goal was to promote home and community-based care settings, this signals success. Why add to that cost savings, though, by fudging numbers? The state's social engineering gone awry is more likely to further depress caregiver wages, push more nursing homes out of business, or inspire another adverse court verdict, than drive Washington's most vulnerable citizens away from a need for skilled nursing care.

Brendan Williams is a former legislator and a long-term care advocate.

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