Nursing homes face $40M loss in reimbursements

By Michaela Gibson Morris/NEMS Daily Journal

Nursing homes hope to avoid the pinch of Medicaid reimbursement cuts.
Eric Holland, owner of Sunshine Health Center in Pontotoc and president of the Mississippi Health Care Association, said negotiations to avoid the cuts are ongoing with the Division of Medicaid.
“The negotiations are going well,” Holland said. “I’ve got a positive outlook.”
A $14 million deficit in Medicaid funds is set to cost Medicaid providers $87 million in reimbursements because of the loss of federal matching funds. Mississippi nursing homes would feel the biggest pinch, losing $40 million in reimbursements for April, May and June. Pharmacists, physicians and other providers also are potentially losing reimbursements.
“It digs deep,” Holland said.
If the cuts take effect, they could be especially devastating for nursing homes because 80 percent or more of their patients rely on Medicaid to pay the bills, and there’s little wiggle room for adjusting rates.
“We are just able to break even at our rates,” said Steve McAlilly, president of Mississippi Methodist Senior Services, the parent organization for Traceway Retirement Community in Tupelo and 11 locations around Mississippi.
According to figures from Gov. Haley Barbour, nursing homes receive an average Medicaid reimbursement of $181.80 a day. The Southern average Medicaid reimbursement is $138 a day.
Barbour said Wednesday that even with the cuts, Mississippi nursing homes will receive more than the Southern average.
But that payment level doesn’t change demands on nursing homes to maintain required staffing ratios and meet federally mandated regulations while trying to provide a good quality of life for the people who live there, McAlilly said.
“You’re asking nursing homes to provide excellent quality in nursing care for about what it costs to stay in a very nice hotel in Memphis or Jackson,” he said.
When the Legislature returns to the Capitol on Tuesday, it also could deal with the deficit by taking money from state reserve funds. Holland said there are alternatives.
“We always try to come up with a solution that helps everybody,” Holland said.
If the cuts do come through, Mississippi Methodist Senior Services is already looking for ways to save money, McAlilly said. They didn’t give managerial level employees raises this year; front-line staff received cost-of-living raises.
“Hopefully it doesn’t last long,” McAlilly said.