Answers about the new proposed Ohio Medicaid cuts from the Governor
Governor Kasich recently released the proposed state budget for the next two years. Severe cuts are outlined in an effort to close the gap on an $8 billion deficit and everyone, from local government, to educators to healthcare providers, will be required to do more with less.
Over the last several weeks, I’ve encountered questions from residents, employees, and the very politicians that will be voting on these changes. Below is a Q&A.
What part of the Governor’s cuts will affect Maple Knoll Village?
In the proposed budget, the Governor plans to cut Medicaid funding for nursing homes by $427 million over the next two years.
Is the Governor targeting nursing homes?
No. The proposed Medicaid cuts will reduce spending by $4.3 billion over the biennium, affecting nursing homes, hospitals, pediatric hospitals and community based nursing services.
What is the difference between Medicare and Medicaid?
The biggest difference is that Medicare is a federal governed program and Medicaid is run by the state. Specifically to Maple Knoll, Medicaid is for patients requiring nursing home care that can no longer afford it.
Shouldn’t we all tighten our belts?
Absolutely and we want to play a role in balancing the state budget. What disconcerting is the method that the state plans to use to determine the distribution of Medicaid. The loss of $427 million averages out to a loss of approximately $500,000 per facility, but under the reimbursement formula, some will gain
over $500,000 while others lose
How is it possible that some nursing homes will actually make money?
Without getting too complicated, the state assigns each facility a cost rate that is used for reimbursement. A “per bed” or “per patient day” cost that is based on the actual cost spent on a facility. For some it may be $130 per day and for others it may be $200. Usually the for-profit, independently owned, have a lower price cost and they stand to actually make money from this proposal.
Are there for profit and non-profit nursing homes in Ohio?
Yes. Non-profit, like Maple Knoll Village, take profits earned, and reinvest them in staff and facilities. We are mission driven to provide quality care and a quality life, not make money. For-profits are run like a private business, they can reinvest in their business or they can keep their profits. So those that spend money on their facilities and programs will have a higher cost rate and will lose more money than those that spend less on their business.
Is the state trying to push non-profit nursing homes out of business?
It’s a case of not understanding how the industry works. State regulations have us working under a double-edged sword where we are required to do more with less or a fine is imposed. The state tells us we can get by with one aide per 15 patients but we know that’s impossible and would only compromise the care of our residents. Our goal is to always do more, not to avoid a fine, but because it’s the right thing to do.
How is this going to impact Maple Knoll Communities?
Our organization stands to lose $4 million over the next 2 years. Although it is estimated that 7,000 jobs related to nursing home care will be lost in the state due to proposed cuts, that is the last place where we will look. Money will always be reinvested in to the care of our residents before anything else.
If these are lean times, why do I see renovations on campus?
Again, Maple Knoll is a non-profit and fund development is a key part of our organization. There are times when we receive generous financial gifts that are earmarked for a specific project and we are obligated to honor that request. If you see projects directly related to operations, it’s because we have found a more efficient approach that will save money in the long run.
Didn’t they already cut Medicaid payments a few years ago?
The state submits a new budget every two years and we continue to do our part in balancing that budget. In 2009 we did see a decrease in payments which resulted in job cuts here at Maple Knoll. We are currently working with a very lean Management staff where most folks are doing the job of 3 and our organization relies heavily on volunteers.
What is the likelihood of the proposed budget being passed?
The proposed budget is now in the House of Representatives and the likelihood of this going through is very high. The new budget takes effect in June, 2011.
What are you doing to prevent the changes?
We are visiting with Legislators in Columbus to share information and to create awareness about the disparities with which facilities are affected.
What can I do to help?
You can voice your concerns through letters, emails and phone calls to your Senators and State Representatives.
I’m available to address and questions or concerns that you may have.