Pennsylvania nursing homes face Medicaid funding shortfalls

Nursing homes throughout the state face Medicaid funding gaps, for a total of $631 million in statewide funding shortages, according to data from LeadingAge PA, an association of nonprofit aging service providers in Pennsylvania. For nonprofit nursing home residents, this amounts to $82.16 per resident per day.

The funding gap is sparking concern that some nursing facilities will be forced to close or scale back due to the shortfall.

The data was compiled for LeadingAge PA by RKL LLP, a Pennsylvania based certified public accounting firm, which developed a custom database using publicly available Medicaid cost reports to measure Medicaid funding to nursing homes.

According to Scott Stevenson, president and CEO of Phoebe Ministries, a nonprofit nursing facility organization with locations throughout Pennsylvania, Phoebe has experienced over $55.5 million in lost revenue due to the Medicaid gap.

“It’s frustrating to go into yet another budget year knowing we’re facing another year of Medicaid shortfalls,” Stevenson said. “We’ve needed to be proactive, adjusting our course and diversifying our services.”

The Pennsylvania Department of Human Services reports that older adults and people with disabilities account for 78 percent of Medicaid spending.

Adam Marles, CEO of LeadingAge PA, is concerned that the Medicaid shortfalls may force some nursing facilities to close.

“The results of this analysis boldly reinforce the crisis skilled nursing facilities continue to face,” said Marles. “Excellent care and services cannot be sustained without reimbursement rates to match the escalating costs.”

Phoebe Ministries President and CEO Scott Stevenson believes that both federal and state government need to allocate additional budget dollars to address the shortfall.

“That increased funding is clearly a challenge,” he said.

Stevenson said that despite the challenge of increasing funding to Medicaid, the alternative of sending patients displaced from nursing home closings to hospitals would be more costly.