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Nursing homes say health care mandate too costly

Currently, Mount Pleasant Retirement Village provides health benefits to 300 full- and part-time employees.

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By Randy Tucker, Staff Writer 1:30 AM Sunday, May 22, 2011

Ohio’s nursing home lobby, already engulfed in a state budget battle to rescind proposed cuts in Medicaid reimbursements, says federal health care reform measures set to take effect in 2014 could be just as devastating to the industry.

At issue in the health care legislation is a requirement that nursing homes with at least 50 employees provide affordable health coverage to all of their workers or pay a penalty.

Providing such comprehensive coverage is simply unaffordable for many nursing home operators who would come under tremendous pressure to cut staff and services if they were forced to comply with the mandate, said Peter Van Runkle, executive director of the Ohio Health Care Association, the largest nursing home lobby in the state.

“We’re sort of fighting for our lives right now with the budget cuts proposed at the state level," Van Runkle said. “But (the health insurance mandate) is going to create some issues down the road.

“As we are forced to reduce staff, it’s going to have a negative impact on the care of our patients. There’s just no way around that," he said.

Most nursing homes would like to offer health insurance to all employees, but reimbursement rates for Medicaid — which pays for care for 50 pecent to 60 percent of all nursing home residents — are insufficient to cover the added expense, according to Van Runkle.

The health insurance requirement coupled with Gov. John Kasich’s proposed $222 million in Medicaid cuts over the next two years would cripple many of Ohio’s approximately 1,000 certified nursing facilities, he said.

Currently, only about half of the approximately 1,000 certified nursing facilities in Ohio provide health insurance to the state’s more than 616,000 unlicensed caregivers, according to research from Miami University’s Scripps Gerontology Center.

And most of the nursing aides, orderlies and attendants who provide hands-on care can’t afford health insurance coverage on their own.

The median annual wage for unlicensed caregivers in Ohio is just over $24,000, according to the Bureau of Labor Statistics.

Advocates for unlicensed nursing home workers say it’s scandalous to have nursing home employees taking care of people when they themselves lack coverage and go without care.

Nationwide, about 25 percent of nursing aides, orderlies, attendants and other workers who provide hands-on care have no health insurance, according to a recent New York Times report, which also reports that nursing home lobbies across the country have lobbied the Obama administration for exemptions to the employer responsibility provision.

Stan Kappers, executive director of Mount Pleasant Retirement Village in Monroe, said it currently provides health care benefits to 300 full-time and part-time employees.

Robert Applebaum, director of the Ohio Long-Term Care Research Project at the Scripps center, said most nursing homes are operating under increasingly tight budgets.

“It’s true that Medicaid rates have been squeezed, and there’s no question that it’s a challenge (to provide health care) in the sense that Medicaid is a big driver of revenues for many nursing homes," Applebaum said. “On the other hand, eight years ago Ohio had one of the highest Medicaid reimbursement rates in the country, and our rates for providing health insurance for workers wasn’t all that great then, either."

John Blowbis, a health economist at Miami’s Farmer School of Business, said times have changed over the past decade and declining occupancy rates means nursing homes are generating less revenue than a decade ago when occupancy rates were over 90 percent.

That makes the health insurance requirement that much more onerous.

“Any type of mandate now has to be offset by increased reimbursement or increased revenue on the nursing home side because they’re making very little money to begin with," Blowbis said. “Most nursing homes actually lose money."

Staff Writer Denise Wilson contributed to this report.

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