Parkinson offers ‘obvious solution’ to staffing, occupancy and financing

Two “critically important” issues will determine long-term care providers’ near-term fate over the next month and a half, the nation’s top nursing home leader said Tuesday.

One is to achieve another extension of the federal public health emergency (PHE) designation before it expires April 15. The other will be achieving a favorable proposal for the 2023 Medicare payment rule next month, said Mark Parkinson, the president of the American Health Care Association / National Center for Assisted Living.

“For the last two years, we’ve viewed our job as getting enough financial resources so that [providers] can survive until census recovers,” Parkinson told McKnight’s Long-Term Care News in an exclusive interview. “It’s been hard because census recovery has pushed out as new variants have emerged. Our objective is still to continue to get resources, whether from the federal level or the state level until census recovers.”

He said the PHE designation from the Department of Health and Human Services is crucial because many states have tied increased Medicaid payments to it. “Job No. 1 is to get the PHE extended,” he emphasized.

The second goal is a strong Medicare pay hike for fiscal 2023, he added. 

“MedPAC has called for a 5% reduction in rates. We just can’t afford that,” he said. “The sector is in crisis. This is not a time to be cutting us.”

There is also a lingering concern that the Centers for Medicare & Medicaid Services may be ready to tug hard on reimbursement rates associated with the Patient Drive Payment Model. Any update probably would reduce payments, which regulators say are higher than desired. They were in place for a few months before the pandemic threw all normal calculation methods out the window.

Parkinson said a third major objective is to continue working with state leaders to strengthen the flow of local funding streams. 

Reform fallout, bad and good

It was federal officials who turned the long-term care world on its head when they announced a sweeping reform package Feb. 28. Tougher inspections and fines, eventual imposition of minimum staffing levels, greater ownership transparency and at least a dozen other proposals were put into play.

The so-called historic reform package has been greeted with a commensurate amount of tumult by disgruntled, worried providers over the last four weeks.

Parkinson, however, said there’s been at least one positive development since President Biden singled out nursing homes in a negative way in his first State of the Union address: more frequent and meaningful communication with administration officials.

“We had been tied up by the pandemic, they had been tied up by the pandemic and we just weren’t talking to each other enough. If we had been,and more specifically, the administration had been talking to providers before the State of the Union, I don’t think we’d be where we’re at right now.”

However, he said damage was done by some comments around reform plans.

“As I’ve talked to providers around the country, there’s this sense that the president has blamed them for 200,000 people who have died of COVID in nursing homes,” Parkinson explained. “It’s impossible for them not to take that personally and to feel hurt. Particularly after everything we’ve gone through the last two years and then to be blamed for all these deaths has been very painful to them.”

He acknowledged that no official administration document placed blame specifically on the workers, “but people have internalized it that way.”

‘Impossible’ occupancy forecast

Parkinson said that the first half of 2021 was encouraging on the occupancy front, rising from about 13% below pre-pandemic levels to 8% below. But then the onset of the delta variant in July 2021 instigated a “stall” of about seven months, which included the more recent wave of omicron variant infections.

“In the last month, we’ve now seen about a 1% increase , so we’re about 7% off of the pre-pandemic level. It’s hard to tell if this increase we’ve seen is enduring or if it’s just a small blip up. The sector needs it to be enduring.”

That creates a familiar situation. Parkinson said once again the hope is for occupancy growth of 1% per month to get back to pre-pandemic levels by the end of the year, “but it’s impossible to know what’s going to happen.”

That’s partly because it’s not known whether any other variants will rise up again, damaging confidence levels and occupancy momentum. But occupancy also is in a mutual chokehold with low staffing levels. Without more staff, many facilities will have to operate at sub-maximum capacity.

“On top of the challenges we normally face with occupancy, the new challenge is that providers just cannot find workers,” Parkinson acknowledged. “So many facilities have closed new admissions or wings to admission until they find workers. I can’t predict when occupancy will come back, but my hope is that this last month of growth is a sign of things to come and that by the end of 2022, we’ll be back at pre-pandemic levels, but I don’t know.”

Staffing’s role

How to “turn the corner” on staffing shortages is a complex issue anchored by three concerns, Parkinson said.

“First, workers need to feel it’s safe to work in buildings again. There was a period in 2020 and when the delta variant came back in 2021 when just working in a nursing home was dangerous,” he noted. “With COVID, the most deadly versions or variants of COVID behind us, it’s now much safer to work in facilities and we need people to feel comfortable with that.”

He said working in facilities also needs to become “more user friendly.”

“You can work just about anywhere in society right now without having to wear K-95 masks all day and without having to get tested on a frequent basis. But in most nursing homes, you’re still under a kind of [personal protective equipment] restrictions we had back in 2020,” Parkinson said. “As the clinical picture improves, we’re going to have to see a relaxing of those requirements or people won’t work in nursing homes. They’re just going to work somewhere else where it’s easier to do it.”

The association CEO said the third leg is improving wages and benefits, beyond the recent notable boosts.

“We’ve seen some pretty significant increases over the last few years. But in the long run, in order to compete, we’re going to have to have a living wage for certified nurse aides, which means we’re going to have to have more funding. Principally on the Medicaid side to create the jobs people want,” Parkinson explained.

That means even more will be needed from state coffers. That might not be as bad as it sounds.

“States have a ton of money,” Parkinson said. “The economy has been booming, so virtually every state has a budget surplus. I’ve really been encouraged by what we’ve seen from the states since the start of 2021. In 2020, it was all about the federal payments that were going to providers. Those really started drying up in 2021, but we’ve really seen many states move forward. States like California, Texas, Florida – states that have had add-ons to their Medicaid rate to the public health emergency.”

Most recently, he said, Florida Gov. Ron DeSantis (R) signed a “pretty significant Medicaid increase to allow nursing homes to compete for workers.”

“It’s not universal, and there are some states where governors haven’t done enough, most notably New York,” Parkinson added. “But the majority of the states have stepped up.”

‘Obvious solution’

Beyond straight funding help, Parkinson said changes to federal policy in one particular area would be doubly good.

“One thing that can be done that would solve a lot of problems would be for the United States to adopt a mature immigration policy. There are millions of workers around the world who want to come to the United States and they want to work, but we won’t let them come,” Parkinson lamented. 

“If we would let them come, not only would we solve our labor problems, we would also reduce our labor costs, and, therefore, have a reduction in terms of inflationary pressures,” he added. “It is frustrating that there are easy and obvious solutions out there to many of these problems, but the policy makers just can’t get their act together to enact them.”

Crisis a glue

Parkinson said a silver lining of the last two years is that long-term care providers have become unified.

“That’s because we’ve been in a battle for a few years and now we’re under attack,” he observed. “When you do that, maybe some of the little skirmishes you had in the past seem pretty petty. The reality of the fact that this is an existential threat sinks in, and everybody’s working together very well.

“Over the last two years, AHCA and LeadingAge have worked closer together than at any time during my 12 years at AHCA,” he noted, referring to the largest and second-largest nursing home associations in the U.S. respectively. “We realize we have to pull together to save the sector and save the jobs for the people who work in the buildings and, most importantly, have great places for the residents. It’s a really tough time, but a positive thing is we’ve never been more united.”

He said that providers are “universally” concerned about their inability to get workers, and are also concerned about their ability “to keep their doors open for the next year.”

“My advice is to stay the course. If people can continue to be focused on providing great care with the workers they do have, we will succeed in DC and at the state levels in getting them additional resources, and census will come back,” he predicted..

“Really, it’s a matter of not giving up, staying the course and doing the basic blocking and tackling in buildings so residents get great care.”

Parkinson offers ‘obvious solution’ to staffing problems, occupancy outlook and financing answers