The COVID-19 pandemic laid bare how decades of state and federal underinvestment in our aging services infrastructure has created a crisis for families trying to access long-term care services—and historic challenges for aging services providers who serve millions of older adults.
The good news is that, with fast, meaningful action, we can still turn this crisis around.
The central challenge is that Medicaid, the dominant payer of long-term care services, doesn’t fully cover nursing homes’ cost of care in most states. For example, a recent study found that rates in Pennsylvania are $86.23 per day lower than the cost of providing care. That’s over $31,000 per year in uncompensated care—per Medicaid resident.
This cruel deficit, combined with a once-in-a-century pandemic, means that we don’t have the direct care professionals we need: 400,0000 people have left the field since the pandemic began! And while caring for older people is a true calling for many, the hard fact is that professional caregivers can earn more money (with less emotional and physical stress) working shifts at a fast food restaurant or retail warehouse.
And, because nursing homes’ primary source of revenue comes from state-and-federally funded Medicaid reimbursements that do not cover the cost of care, our providers simply do not have the ability to increase wages to compete with Starbucks or Amazon.
Because of these workforce shortages, many providers are suspending new admissions and struggling to hire. Many report being in dire financial peril due to pandemic-related costs, including outrageous fees charged by temp agencies. At one Cleveland nursing home, the cost of care is $100 more per day per resident than their reimbursement, which can quickly add up to millions in shortfalls. Covering these gaps through philanthropy is no longer enough—which is why that nursing home is closing in June. More may follow.
Older Americans and their families are paying for the long-term failure of our policymakers to prioritize our aging services workforce.
The federal government and its state partners share the responsibility for inadequate funding, low staff wages, and failure to measure and improve quality using the most robust evidence. Quality of care and staffing work hand-in-hand—and neither can be achieved without sufficient funding.
A bold, all-of-government approach is needed to get us out of this crisis—and ensure consistent access to quality care that older adults and their families deserve. Here’s how to begin:
- Compensate frontline staff fairly. This can be accomplished by Congress acting to provide increased federal “FMAP” funding for nursing home care, and requirements that states reimburse for the cost of care.
- Expand the pipeline of applicants seeking meaningful careers in aging services, with training and apprenticeship programs modeled on initiatives that already exist in the departments of Education and Labor. We need to offer career ladders to help people stay in the field and continue doing the work they love.
- Make immediate changes in immigration policy to allow foreign nursing staff hired by long-term care communities to get to the United States as quickly as possible.
- Address price gouging by temporary staffing agencies. Prohibit agencies’ ability to charge exorbitant rates to nursing homes whose revenues are principally drawn from Medicaid and Medicare.
Aging services providers want more than anything to hire and train more people who are eager to care for the growing millions of Americans who need support. But we need help from Congress and the administration to get there.
Katie Smith Sloan is president and CEO of LeadingAge, the association of nonprofit providers of aging services, including nursing homes.