Nursing homes, pharmacies hurting from Medicaid costs

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Any thoughts or comments on this? Nursing homes, pharmacies hurting from Medicaid cuts - Journal Advocate

A number of community organizations have been affected by the recent proposed budget cuts by Gov. Bill Ritter, as well as budget cuts that are looming on the national level.

With almost 75 percent of the population in skilled nursing facilities dependent upon Medicaid to cover the cost of their care, nursing homes in the area will definitely feel the results of the proposed budget cuts being considered.

According to Terri Starkebaum, administrator at Sterling Living Center, there will be effects on Medicaid.

“We’ll batten down the hatches and we’ll survive, because that is what we do,” she said.

“Facilities have to meet enormously high standards, besides attempting to meet the demands of the public,” said Gloria Kaiser, administrator of Devonshire Acres in Sterling.

The proposed cuts appear to be about 1.5 percent of the established daily per diem effective Sept. 1, 2009 according to Kaiser. The Colorado reimbursement per day is now $12 below what it actually costs to care for an individual resident.

In April, Colorado implemented a new reimbursement scale which was developed using current expenses. Up to that time, dollars received were based on expenses that had occurred 18 months prior to the rate being granted.

“In order to accomplish this task, the facilities had to then agree to pay a provider fee,” Kaiser said. “This was, in reality, a charge of three percent of the increase we were to receive. The formula is very complex and was based on actual Medicaid days.”

All costs are audited by the state and the reimbursement is established by the state and generally there is no consideration given to what the regulations require, which are monitored by another state agency, she said.

“If this happens (the 1.5 percent cut of daily per diem), the bottom line is that small facilities will go out of business, quality of care will be jeopardized and additional unemployment will happen,” Kaiser said.

“These are very challenging times and the senior population needs a voice if the services they need are to continue.”

There is also concern by those in the pharmaceutical arena as to how not just state but national cuts will affect those on Medicaid.

“The smaller pharmacy is more of a concern since the cuts will be harder to absorb,” said Jenae Lorenzo Lock, pharmacy manager at Barnes Pharmacy in Sterling. “And that could impact the free services that are offered.”

“There will be no change to the patient’s co-pay,” she said. “But the cuts may limit physicians in medications they can prescribe.”

And to compound the issue, if drug x is $150 and drug y is less — drug y may have more side effects causing a need for more drugs to address those issues, she said. Lock also expressed the need for more consistency in the reimbursement; if not, there is concern the quality of care is going to suffer.

And quality of care is a giant concern at this point. Many of the smaller agencies who depend on funding through grants have recently received notice that the funding is not there this year. Many think that loss of funding will mean loss of jobs.