Nursing Homes in Massachusetts Face a Financial Crisis

elderly man in wheel chair

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Many nursing homes throughout Massachusetts are facing financially hard times. In 2018, 20 nursing homes closed and over 200 out of the total of 401 nursing homes are operating in the red.

Advocates are saying the issue is partly from the Medicaid reimbursement rate. Seeing as a portion of many residents in these nursing homes rely on Medicaid to pay for their care, the nursing homes are being compensated at a much lower rate. The issue is the Medicaid reimbursement rate is based on 2007 costs and this rate does not fully cover the cost of daily care.

Nursing home owners, operators, and directors are then unable to pay skilled workers, who care for the residents, a competitive wage. According to one owner of a skilled nursing facility, “we can’t get staff because we’re competing with Dunkin’ Donuts.” Dunkin’ Donuts can pay $16 an hour for less taxing work compared to that of a CNA who may make less and have to struggle to feed and bath a resident.

The owners are now trying to get legislation to help them. They’re hoping for the Medicaid Reimbursement rate to reflect current numbers and take into consideration inflation. And they are also hoping to see an adjustment in the occupancy penalty to allow for lower occupancy that lines up with the industry median occupancy of 90 percent.