Medicaid Reimbursement Rates are Costing Nursing Homes Money & Staff

Some nurses are leaving their job for higher wages at fast-food restaurants or convenience stores.

By Rhonda FanningApril 7, 2016 2:55 pm| ,

As Texans await for a resolution to the Medicaid waiver question, another potential crisis is looming in nursing homes across the state. Advocates for the medical staff at those facilities are saying employees are leaving the field to take better paying jobs at Wendy’s or McDonald’s.

Bobby Blanchard, a reporter with the Dallas Morning News, says the issue, in part, stems from Medicaid reimbursement rates in Texas.

“Texas had the third lowest Medicaid reimbursement rate,” Blanchard says. “The only states that have lower rates are South Dakota and Illinois. In Texas it’s so low that many nursing homes actually spend more on Medicaid patients than they are reimbursed.”

That’s particularly troubling for nursing homes, Blanchard says, because 85 percent of their patients are either Medicaid- or Medicare-dependent.

“They can’t compete with other health care industries and other industries in general,” he says.

Some certified nursing assistants have minimum wages at $10.

“Many are finding they can make more money working at McDonald’s or Wendy’s – or even Buc-ee’s,” Blanchard says. “Advocates are concerned that we’re going to have a nursing shortage.”

The turnover rate for nurses is 94 percent annually, which impacts the nursing home’s ability to care for its residents. There’s a possibility that the ratio of caregivers to people at the age of 80 could drop from 7 to 1 in 2012 to 4 to 1 by 2050.

The turnover also provides more financial problems for the homes. After staff members leave, the nursing home invests in advertising for jobs, and training and certifying new recruits.

Advocates are asking the state to either increase the Medicaid reimbursement rate, or add more financial incentives to nursing homes, to help them retain staff and offer more competitive pay, Blanchard says.