Impact of Medicaid Cuts on Nursing Care
Cuts to Medicaid will significantly worsen nursing care quality by limiting access to nursing homes, reducing staffing levels, and hampering innovation in nursing care delivery, particularly affecting vulnerable populations like those with Alzheimer's disease. 1
Effects on Access to Care
- Fiscal constraints lead states to tighten Medicaid eligibility criteria for nursing home care, reducing access for those who need it most 1
- People with cognitive impairments like Alzheimer's disease are particularly disadvantaged by eligibility screening protocols that prioritize physical functional impairments over behavioral or cognitive needs 1
- Reduced Medicaid funding exacerbates the existing "two-tier" system of nursing home care, with lower quality care in facilities serving predominantly Medicaid recipients 1
Impact on Staffing and Care Quality
- Medicaid cuts directly affect staffing levels, which are critical to quality care - each additional patient per nurse increases readmission odds by 3% 2
- Reduced funding leads to workforce reductions that result in lower morale, increased workload stress, and ultimately reduced quality of care 3
- Nursing homes with greater financial resources consistently demonstrate better quality outcomes for residents 4
- When funding is cut, facilities often replace registered nurses with less qualified staff, despite evidence that higher RN staffing and skill mix are associated with better outcomes and potentially reduced net costs 5
Effects on Innovation and Care Models
- Medicaid cuts hamper implementation of culture change initiatives and innovative care models that improve quality of life for residents 1
- Innovative models like Evercare, which integrates primary care with nursing home services to reduce hospitalizations, require adequate funding to implement 1
- Pay-for-performance approaches that improve quality require financial investment that becomes difficult with reduced Medicaid funding 1
- Culture change initiatives are more likely to occur in resource-rich nursing homes not dependent on Medicaid funding 1
Financial Implications
- The disparity between Medicaid and Medicare reimbursement rates (approximately $125/day vs. $500-600/day) already incentivizes nursing homes to focus on short-term rehabilitative care rather than long-term care 1
- Further Medicaid cuts would intensify this disparity, potentially reducing access for long-term care residents 1
- Pass-through subsidies that tie Medicaid reimbursement directly to staffing expenditures have been shown to increase staffing by about 1% on average and reduce negative outcomes like pressure ulcers 6
Recommendations to Mitigate Negative Effects
- Expand ADL dependency assessments to include need for verbal assistance and properly weight cognitive/behavioral symptoms in eligibility criteria 1
- Implement Medicaid pass-through subsidies that directly tie reimbursement to staffing expenditures 6
- Develop innovative payment approaches to help nursing homes meet the substantial up-front costs of implementing culture change initiatives 1
- Revise regulations to encourage person-centered care practices and establish programs that reward innovation 1
- Prioritize investment in registered nurse supply rather than substituting with less qualified staff 5, 3
- Involve all stakeholders when developing Medicaid long-term plans or initiatives to integrate services 1
Special Considerations for Mental Health Care
- Current nursing home payment systems under prospective payment inadequately compensate for the added intensity of nursing and social services needed by persons with psychiatric disorders 1
- The Resource Utilization Groups (RUGs) reimbursement system provides negative incentives for nursing homes to accept behaviorally disturbed patients 1
- Medicaid cuts would further reduce already insufficient reimbursement for psychiatric services in nursing homes 1