107 E Eureka Ave, #1
Eureka, IL 61530
121 N Main St
Bloomington, IL 61701
309-467-3213 schedule consultation
schedule consultation

Increased payments to nursing homes went to profit margin instead of care

Published on April 17th, 2008

Below is an excerpt of an article I recently saw from The Choate News about how California nursing homes used an increase in reimbursements from the State for profit instead of providing adequate care.

Nursing Home Pocket Money Meant For Care
By Jordan Rau

SACRAMENTO, Calif. — California’s nursing homes pocketed much of the $590 million that state lawmakers provided them to better tend to low-income people, while patient care declined by several key measures, according to a study to be released Tuesday.

A law boosting reimbursements from MediCal, the state’s health-care program for poor people, passed in 2004. By 2006, the first full year the higher rates were in place, average nursing-home revenues from MediCal had increased from $124 a day to $152 per day, according to the study by a team of researchers at the University of California, San Francisco — but few of the promised improvements for patients or staff had come to pass.

Nursing attention for patients grew, on average, by 3 percent. But the study also found that 144 homes, or 16 percent, did not meet the state’s minimum staffing standard.

Average wages for nursing assistants increased from $10.61 an hour to $11.32, not quite enough to keep pace with inflation, the study said.   Turnover among nurses grew slightly worse, with nearly 7 in 10 leaving their jobs that year.

The amount nursing homes spent on direct patient care actually decreased by 3.6 percent, according to the study. Substantiated complaints of patient mistreatment increased by 38 percent. State and federal regulators cited homes for 6 percent more violations.

“They got so much money, they should have been able to do something,” said the study’s lead author, Charlene Harrington, a UCSF professor and nationally recognized authority on nursing homes.   “The fact that they let the nursing-assistant wages actually decline with inflation, I think there’s no excuse for that,” Harrington said. “They’re the bulk of the workers and they’re the lowest paid.”

The higher reimbursement rates were pushed through the Legislature in the final two weeks of its 2004 session by a powerful alliance between the nursing-home industry and Service Employees International Union, which represents many health-care workers.

At the time, several nursing-home advocates objected that the measure lacked sufficient safeguards to ensure that the money went to patient care.

Along with more money, the new law changed the way facilities were reimbursed from a flat fee for each patient to one based on how much the homes spent on workers, patients and the physical plant. Supporters pledged that the change would reward homes that hired more nurses and paid them better.

The average nursing home netted $248,047 in 2006, a 233 percent increase from 2004, the study said.   The study found some areas where nursing-home spending did increase substantially.

For example, administrators’ wages rose by 13 percent, and the pay for licensed nurses — who have more training than assistants — grew by 9 percent.

Nonprofit nursing homes raised their wages more than for-profit homes. Still, said Michael Connors of California Advocates for Nursing Home Reform, a patient watchdog group, “to a great degree, no one knows where the money went and how it was used. What’s clear is it hasn’t been used for beneficial effects on residents, which is appalling.”

Joe Pioletti
Latest posts by Joe Pioletti (see all)

Tags: , , , ,

Back to News


107 E Eureka Ave, #1
Eureka, IL 61530


24/7 live phone answering


121 N Main St
Bloomington, IL 61701


24/7 live phone answering


2 Dearborn Square #1D
Kankakee, IL 60901


24/7 live phone answering

Contact Us Today!