Dear Editor,
As the Administrator for Gilroy Healthcare and Rehabilitation
Center I feel compelled to share with the community the ongoing
struggles and pending financial crisis that all skilled nursing
facilities are facing.
Dear Editor,
As the Administrator for Gilroy Healthcare and Rehabilitation Center I feel compelled to share with the community the ongoing struggles and pending financial crisis that all skilled nursing facilities are facing.
As the only free-standing facility in Gilroy, it is our philosophy to serve all of the community regardless of one’s payer source. During the past three years, our average occupancy has been comprised of 70 percent Medi-Cal recipients.
For the years 2002 through 2005, the total increase in Medi-Cal reimbursement will average 1.3 percent per year.
Our actual medical daily reimbursement comes to less than $6 per hour/per patient.
It was anticipated that additional funding of 5.47 percent would be forthcoming this year based on the passage in August 2004 of SB 1629.
The plan needs to be pushed by the governor in order for it to be approved and funded in a timely manner. It was originally thought funding would happen by May of 2005. The governor has now put forth his own re-design plan for acute hospitals that needs approval from the Center for Medicare Services.
The acute hospitals spending plan amendment has a value of $2 billion versus that of skilled nursing facilities of only $250 million. It is anticipated that CMS will not approve the amendment for skilled facilities this year due to this change in priorities. This leaves us only to wonder what 2006 holds.
The administration is proposing more cuts over the next 10 years for Medicare reimbursement. Translated to historic numbers it represents a 10 percent cut in Medicare revenue on an annual basis for Gilroy Healthcare.
The new proposed budget for Medicaid includes $60 billion in cuts and a reduction for drugs of $15.1 billion and reducing asset transfers as a means for qualifying for Medi-Cal. Currently an average skilled nursing facility is losing $12 to $15 per day for each Medi-Cal Patient.
Like all employers we have faced the same staggering increases in workers compensation and health benefits. In addition, liability insurance for long-term care facilities has increased exponentially. In California the number of claims per 100 beds has increased 50 percent since 1999.
The severity of the average claim has grown 78 percent since 1999 to almost $260,000 per claim. Is there any wonder why in the last 12 years there has not been a single skilled nursing facility built in all of Santa Clara County!!
The Bush administration talks about the future of Social Security. A far more serious problem affecting the federal government and every state is the accelerated expense and burden of Medi-Cal.
The burden of this albatross should not be placed on California’s frailest seniors and the dedicated staff who provide skilled care and comfort on a daily basis.
I urge each of you who reads this to pick up the phone or send an e-mail to both our state and federal representative to stop further cuts, and ask for meaningful rate reform for all long-term care facilities. If I can provide any assistance in this process, please feel free to call me at (408) 842-9311.
Gerald E. Hunter, Executive Director Gilroy Healthcare and Rehabilitation Center
