Local nursing homes say a reduction in Medicaid reimbursement rates set for next week could reduce their ability to care for low-income patients in the wake of ongoing COVID-19 shifts in the health care industry.
A $19.63 per-patient per-day Medicaid reimbursement to help cover pandemic-related expenditures will end May 11, when the federally declared public health emergency expires. The additional subsidy was authorized and funded by the state, contingent on the emergency order put in place in April 2020.
But providers argue that expenses like staff wages and patient supplies continue to rise, making the cost of taking on lower-income patients higher even as the reimbursements roll away.
In Bexar County, which has among the highest Medicaid enrollment rates in the state of Texas, and in San Antonio, where more than 24,000 seniors live at the poverty level, that will have an impact, said Kevin Warren, president of the Texas Health Care Association.
“The average facility could end up losing between $40,000 and $50,000 a month that they’re going to have to absorb, while still having costs that have increased due to staffing, wages and inflation — and all these other costs that aren’t coming down,” said Warren, whose organization advocates for nursing homes and other health care industry needs.
Previously existing gaps in Medicaid funding have already caused some smaller-scale and nonprofit nursing homes to take in fewer of those patients or stop accepting them entirely, said Patrick Crump, CEO of Morningside Ministries, which manages three senior living facilities in San Antonio.
“To take that $20 away, it’s just going to make things more challenging,” Crump said. “At the end of the day, providers like us have to decide, are we going to continue to decrease the number of Medicaid residents we serve simply because we just can’t afford to do it?”
Crump estimates that the end of the public heath emergency’s added Medicaid subsidy will lead to an overall loss of about $250,000 to $300,000 a year at just one of their facilities, Morningside Manor on the Northwest side.
The Medicaid reimbursement rate per day — with the subsidy included — is about $170, Crump said, but he estimated that costs to care for Medicaid patients are well over $200 a day.
Even before the subsidy expired, Medicaid reimbursement rates were “inadequate,” he said, which contributed to the closure of the nonprofit’s Chandler Estate branch near Tobin Hill in 2018.
A lot of the patients at Chandler Estate were Medicaid patients, Crump said, and the reimbursement payouts weren’t enough to keep operations running, so it closed.
The nursing home eventually reopened as residential apartments, a spokeswoman said.
Medicaid reimbursement rates, which are set through a combination of state and federal contributions, were last increased on the state level in 2013. They’re reviewed every two years by the Texas Senate Committee on Health and Human Services as the state sets its health care budget.
Advocates and health care coalitions have been warning about the subsidy ending for years in preparation for the May 11 deadline.
Crump said if help doesn’t come soon, many facilities won’t be able to afford taking in Medicaid patients.
“I’m cautiously optimistic that somebody in Austin will understand the struggles we’re facing and figuring out how to put the money in the system,” Crump said.
The added subsidy came at a time when nursing homes were struggling to stay afloat as health care professionals left the field, a challenge that hasn’t gone away.
Warren, with the Texas Healthcare Association, argued that there is enough money in the state budget to increase the Medicaid base rate.
“It’s critical that these funds continue to flow,” Warren said. “Serving underserved populations and in those communities in need, facilities like that play extremely important roles. … They provide that support for the families, they provide that support for the residents and they’re providing jobs, which is critical these days.”
Correction: This story has been updated to correctly refer to the closure and reopening of Chandler Estate as residential apartments.
