Nursing homes on the brink of budget disaster

White Bear Lake's only nursing home is nestled in a quiet residential neighborhood. The 185-bed brick building is like many of Minnesota's aging nursing homes. A walk through it feels like stepping back in time.

Greg Baumberger has been the administrator of Cerenity Senior Care for four years.

"The facility that we're in right now was built in the mid-'70s," said Baumberger. "The original building was built in ... 1957 I guess it was, the original date."

Many residents still share rooms, and in some cases up to four people share a single bathroom. Baumberger would like to update some of those rooms, but he's got other more pressing expenses right now, including keeping up with repairs on his patient lifts.

"This machine is about $5,000," said Baumberger.

The metal device is an essential piece of equipment for any nursing home. It helps staff members lift residents who can't get into a wheelchair or a bed on their own. Cerenity has more than 30 patient lifts. To be safe they need regular maintenance.

"And they can nickel and dime you," said Baumberger, "so you have to replace them."

He was hoping this would be the year his nursing home would get more money from the Legislature so he could make some updates, buy new equipment and give his staff a raise.

But then the specter of the budget deficit reared its ugly head, and nursing homes started to worry that their Medicaid funding might be an obvious place to start cutting.

Minnesota administers the federal Medicaid program, and matches it with its own state funds. The state essentially decides what rate it is going to pay nursing homes who take Medicaid patients.

Traditionally, that rate has always been quite a bit lower than the cost of caring for patients. And Minnesota is one of just a few states that also requires nursing homes with Medicaid patients to offer that same rate to all of its residents, even if they can pay more for their care.

If lawmakers cut nursing home funding, the consequences will be dire for nursing homes that serve the state's poorest people.

Still, Medicaid money is the lifeblood of many Minnesota nursing homes. And the way lawmakers set the rates determines the future of many of them.

If lawmakers don't make any changes to the Medicaid rate this year, Baumberger says he would have to freeze his employees' wages. That would be bad enough, he says, since his workers are already severely underpaid compared to their peers who work in hospitals.

But what would be even more catastrophic to his nursing home is if lawmakers decided to cut Medicaid payments.

"As a last resort, we would cut employee positions. And hopefully that wouldn't need to happen," said Baumberger.

Anji Hansen has been working at Cerenity Senior care for five years. She started as a nursing assistant and now works in recreational therapy. She would love to get a raise this year. But she's not expecting one.

"For me, I guess right now it's just the thing of being happy I have a job," said Hansen.

But some of her coworkers are tired of the wage situation. She says they don't understand why they can't get a break.

"It's hard to be given a number, and that number's seen and it's instant anger," said Hansen. "We have a great staff in the way that everybody tries to help everybody understand that it's not Greg, it's no specific person, so don't shoot the messenger."

Over in the dining hall, the situation isn't lost on Cerenity residents. Bev Yobbie says while she understands that lawmakers have difficult choices to make, she thinks they should preserve funds that pay for nursing homes.

"Well, I hope they don't cut any," said Yobbie. "The people here do so much work for everybody, and they really should get raises."

The organization that lobbies for nursing homes will be arguing that very point this session. The Long-Term Care Imperative will ask lawmakers to give nursing home workers a 2.9 percent pay increase. They also want a 1 percent temporary bonus from last year made permanent.

Patti Cullen is president and CEO of Care Providers of Minnesota, one of the two groups that make up the Long-Term Care Imperative. She says if lawmakers cut nursing home funding, the consequences will be dire for nursing homes that serve the state's poorest people.

"If they want to stay open and do business, they'll get out of the Medicaid program. And by getting out of the Medicaid program, those without means are going to be stuck in hospitals," said Cullen. "So I think it's going to drive the system to a place that's really not good public policy."

Since 2001, 52 nursing homes have closed in Minnesota, and Cullen says many more are on the financial brink. She says another year without a payment increase will ensure that more nursing homes shut their doors.

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