40% Texas Nursing Homes are in Bankruptcy

[Guest guest]

TexasCrossroads

Home | Yellow Pages | News | Sports | Stocks | Community |

Directions

TV | Calendar | Sales Events | Weather | Movies | Classifieds

| Autos | Careers | Real Estate

New users Sign On

Registered users Sign In

Personalize TexasCrossroads

--------------------------------------------------------------------------

AP Wire News

Business & Financial

Entertainment

Health & Science

International

National

Politics

Sports

Technology

Special Sections

Advocate Autos

Advocate Careers

News Archives

Comics

Message Boards

Crossroads Radio

Webcam

Internet Access

College Scholarship Search

Photo of the week

Yacht Race

Bush's 2002 Budget

Advocate Job Listings

CITY/SCHOOL ELECTIONS

Headlines

Tue - Apr 24 2001

Tale of two Mississippi River towns

Sheriff's office vacated due to fungus

Unemployment rate creeps up, yet is still lower than last year

Gas costlier but cleaner

Jury finds man guilty of murder

Mon - Apr 23 2001

Astronauts install robot arm

Hispanic business presence growing

Fiddlers, barbecuers vie for top honors in Hallettsville

Caring for the elderly

Felons, fugitives getting illegal benefits

- Frontpage News

Caring for the elderly

Lawsuits, legislation target underfunded nursing homes

Monday April 23, 2001

AUSTIN (AP) -- It's a sad story that lately has been told too often.

Texas nursing homes abruptly shutting down, leaving hundreds of

elderly residents and their families to scramble for care. Dozens of facilities

in bankruptcy, dozens more on the brink.

Lawsuits, skyrocketing costs, high occupancy rates and even higher

employee turnover.

" If we don't do something to provide an immediate financial

injection to an industry that's already on life support, while it's hard to

imagine, the situation is only going to get worse, " said Sen. Mike Moncrief,

D-Fort Worth.

The state has " underfunded this industry for 20 years, " said

Horabin, president of Stonebridge Health Center in Austin, a plaintiff in a

lawsuit against the state over low rates.

From lawmakers to nursing home operators, everyone agrees it's time

to increase funding to nursing homes.

Exactly how to do that in a tight budget cycle isn't as clear.

Moncrief and Rep. Craig Eiland, D-Galveston, are sponsoring

legislation that could raise $500 million that would flow through the Medicaid

program.

The industry is split over the plan, which would charge all nursing

homes a " quality assurance fee " of $5 per occupied bed per day whether or not

the home has Medicaid patients. It would be used to match, or " draw down " new

federal money.

Texas receives about 60 cents in federal money for every 40 cents

the state pays.

" It is not the best way to draw down this federal money, but in this

tight budget, it appears to be the only way, " Eiland said.

About 71 percent of the estimated 93,000 Texas nursing home

residents receive Medicaid, the federal-state health care program for the poor.

If approved, the plan also would send money to the Department of

Mental Health and Mental Retardation for use at state hospitals and schools and

to agencies that help care for the disabled.

The plan would help 1,150 of the state's 1,265 nursing homes, Eiland

said. He acknowledged that 115 private homes, which do not participate in the

Medicaid program, would not benefit.

The funding increase would help the industry where employee turnover

rates are as high as 150 percent, Eiland said. The average hourly wage for

nursing home employees is about $7.

" You can't operate a business, you can't get quality care for

elders, if these people keep turning over. I don't blame them for turning over

because the wage is so low, " Eiland said.

The state would use $339 million of the new funding to form a

" Quality Assurance Fund " for the next two years.

The fund would be used to increase reimbursements to nursing homes

as well as give the homes funding for wage increases and to pay for expensive

liability insurance. Money also would be carved out for use on additional wage

and staff increases.

Eiland and Moncrief stress that the idea is not a permanent solution

to a problem that has been plaguing the state for years, but it's the best

lawmakers can do right now.

" I would love to fund this out of general revenue but we don't have

it. That's why we're going to include a sunset provision for four years to give

us time to try to find it and fund it in different ways, " Eiland said. " If

anybody can find us $500 million, I would drop this in a heartbeat. "

Industry lobby group Texas Health Care Association applauds the

effort. Most of its member homes would receive additional funding under the

plan.

" It's a good first step, " said spokesman Tim Graves. " In desperate

times, unfortunately, sometimes we need to be real creative. "

Horabin's group, Texas Alliance for Nursing Homes, oppose the idea

because many private homes would not benefit despite paying the fee.

" Representative Eiland calls this a quality assurance fee. I call it

a tax on Granny, " Horabin said.

" It is not a good plan. It taxes all the nursing home beds in Texas

whether they're in the Medicaid program or not. It will raise the cost for the

people who are not on Medicaid who are paying their own way, " Horabin said.

Eiland said he hoped a separate $10 million fund would help those

private nursing homes pay for expensive liability insurance.

The funding issue gained steam this legislative session after a

group of small homes, including Horabin's, sued the state, claiming low state

funding and skyrocketing liability insurance rates are forcing them out of

business.

The lawsuit is pending.

Lawmakers also have been forced to deny agency requests for nursing

home funding increases because of a tight budget.

The state's Medicaid reimbursement rate of about $85 per day is

about $11 less than the average cost of daily care, forcing many nursing home

owners to operate in deficit. Texas ranks 45th in reimbursement levels, $25

below the national average.

About 40 percent of Texas' nursing homes are in bankruptcy because

of low reimbursement and other factors such as liability insurance to protect

against lawsuits and high vacancy rates.

" You put you all of those in a pot and you've just got a really bad

recipe, " Graves said. " It's time to act. "

The federal government must sign off on the proposal before

releasing the additional funds. Eiland said initial response from Washington was

good.

Advocate News

Frontpage News

Local/State

Nation/World

County by County

Lifestyle

• Anniversaries

• Books

• Engagements

• Food

• Garden

• Weddings

Business

Farm

Ranch

Police/Courts

Opinion

• Editorials

• Letters

Births

Obituaries

Sports

• High School Sports

Columnists

Classifieds

Comics

Corrections

& Clarifications

Feedback

Web Search

Search on

The Site Web Search

for:

--------------------------------------------------------------------------------

Back to top

Advertising Info | Help | Terms of Use

Subscribe to ISP | Subscribe to Paper

Give us Feedback about what you think of TexasCrossroads.com

Advocate: Editors | Circulation Department | Letters to the

Editor | Archives | Submit News

Copyright © 2000 MyWay. Portions © 2000 The Advocate Publishing

Co. All rights reserved.

v. 2.8b wchb6