May 13, 2003 -- Proposed 15% Medi-Cal cuts will endanger 700 nursing homesThis is a continuation of national policy of using cuts in the care of elderly, disabled, mentally ill, and substance abusing people as a wedge for later cuts to everyone's health care.
Contra Costa Times, Tue, May. 13, 2003
Medi-Cal cuts seen as tragic scenario
By Thomas Peele
A proposed 15 percent cut in Medi-Cal benefits puts nearly 700 nursing homes in danger of financial collapse and possible closure, imperiling thousands of elderly and disabled residents who rely solely on the government for their care, according to a UC San Francisco study released Monday.
The quality of care those patients receive would suffer as nursing homes endure financial losses as high as 25 percent, the report's primary author said.
Study author Martin Kitchner, a UCSF social sciences professor, could not predict the fate of individual nursing homes. "But this isn't going to do any of them any good," he said.
The report comes on the eve of the release of Gov. Gray Davis' revised budget Wednesday. The proposed 15 percent cut in Medi-Cal payments for nursing home patients -- essentially, the poorest of the state's poor -- is among the many items under consideration as the state struggles to close a budget deficit of almost $36 billion.
Davis is expected to address Medi-Cal in the release of his updated fiscal projections.
The cuts mean a reduction of about $19 to the $131 a day the state pays Bay Area nursing homes for Medi-Cal patients.
Kitchner's report states that if the cuts occur:
** The median facility net income will fall from a profit of 2.23 percent to a loss of 7.74 percent.
** 261 nursing homes across the state would suffer financial losses of at least 15 percent.
** 60 percent of the state's roughly 1,400 nursing homes will suffer operating losses of at least 5 percent.
That all adds up to a disaster for patients who rely on Medi-Cal to pay their nursing home bills, said Pat McGinnis, executive director of the watchdog group California Advocates for Nursing Home Reform.
"This is a tragic, tragic, scenario," McGinnis said Monday. "These are people who have spent down (their resources). They don't have anything else. They are completely without assets."
Nursing home owners have few places to trim to absorb the cuts except in staff reductions, she noted. Reductions in staff mean less care for patients, most of whom are elderly and frail.
Repeated studies and investigations show that reduced attention from nursing staff puts patients at greater risk of medical problems like bed sores, dehydration, malnutrition and incontinence -- all common factors in the rapid deterioration of nursing home patients.
"We call these the cuts that kill," McGinnis said.
At greatest risk, both McGinnis and Kitchner said, are "mom-and-pop" owners of small nursing homes.
Barry Barkan owns such a nursing home -- the 60-bed Live Oak Living Center in El Sobrante that he has said will probably close if the cuts go through.
"It is no longer possible for a small business like ours to operate," Barkan said late Monday. "We are the canary in the coal mine, and the canary is dying." He predicted widespread financial failures of nursing homes if the proposal becomes law.
"It's not going to work out any other way," he said.
The nursing home industry's Sacramento trade group, the California Association of Health Facilities, has lobbied legislators and coordinated the writing of more 300,000 letters on the issue, its spokeswoman, Kelley Queale, said Monday. Its message: "There's nowhere left to cut," she said. Queale wouldn't comment about what might happen Wednesday.
"We anticipate something will be said. We don't know what," she said.
The issue has McGinnis' watchdog group and the industry -- longtime rivals over care issues -- on the same side. "Everyone is concerned about this," she said.
The grim scenarios McGinnis discussed Monday include more nursing homes refusing to admit new Medi-Cal patients, a move that could force poor people with nowhere else to go for skilled nursing services into hospitals at greater cost to taxpayers.
When nursing homes close, the state agency that regulates them, the Department of Health Services, often put employees in the facilities to monitor patient transfers. That takes staff away from inspections of other homes at a time when care will plummet and further put patients at risk, she said.
The Oakland-based California Healthcare Foundation funded the UC San Francisco study. The union that represents most of the state's nursing home workers, the Service Employees International Union, distributed the report.