Slow-Moving Review Process Snags Medicaid Payments to Nursing Homes, Patients

Andrew Kitchenman | March 6, 2015 | Health Care
Legislation would require state to pay out benefits while it determines eligibility

nursing home
The computer system and county offices that determine whether New Jerseyans are eligible for Medicaid to pay for nursing home are antiquated and making the state the slowest in the region for determining benefits eligibility, according to nursing-home industry representatives.

The plight of nursing homes, some of which are racking up millions of dollars in delayed bills, has prompted lawmakers s to advance legislation, A-3929, that would require the state to pay up to 50 percent of those bills while deciding whether patients are Medicaid-eligible. If the person were later found to be ineligible, the state would recoup the money.

Assemblyman Daniel R. Benson (D-Mercer and Middlesex), a bill sponsor, said the nursing-home industry is being continually squeezed.

“Their ability to float these costs over a long period of time just is not tenable,” Benson said. “Providing this relief valve is really what is important to ensure that proper care is given during that time.”

The state Department of Human Services has been hit with similar criticism from advocates for low-income families for delays in processing applications for Medicaid health coverage (separate from the long-term care provided by nursing homes) and determining eligibility for food stamps.

Much of the problem revolves around the botched development of a new computer system, which led the state to cancel a contract with Hewlett-Packard after the company failed to deliver the Consolidated Assistance Support System (CASS).

In addition to the computer system, the state relies on county welfare offices to process the applications, which analysts say leads to uneven results and delays in some counties.

Another element frustrating supporters of the bill is that the state has a plan in place to make the necessary improvements, but hasn’t completed it, perhaps due to the CASS problems.

Nursing homes must accept many patients with serious health problems and wait for the government to determine whether they’re Medicaid eligible.

Medicaid eligibility is supposed to be determined within 45 days, but frequently takes more than 90 days.

One case has taken two years and the nursing home involved has racked up $190,000 in delayed Medicaid payments, according to Jon Dolan, president and CEO of nursing-home industry trade group the Health Care Association of New Jersey.

In another instance, Medicaid delays contributed to another nursing-home provider going into bankruptcy, according to HCANJ officials, who did not name the provider.
One company, Genesis HealthCare, is owed more than $9 million from Medicaid for New Jersey residents who are awaiting eligibility determinations, according to a company official.

While Genesis operates facilities in 34 states, more than a quarter of all Medicaid reimbursements nationally that take more than 90 days to resolve are in New Jersey. The delays in New Jersey are three times longer than in Pennsylvania and four times longer than in Massachusetts, according to the company.

Dolan said requiring the state to make the payments sooner would make it easier to assess which counties have the most difficulty processing applications.

“In one county it may be a personnel issue, in another county it may be a process issue, but only with state oversight and clear benchmarks and indicators would you understand the naughty and nice list,” Dolan said.

Senior Planning Services, a company that helps families apply for Medicaid, has found that New Jersey eligibility determinations take an average of 122 days, compared to 96 days in New York, 55 days in Pennsylvania and 44 days in Connecticut, according to company marketing director Neil Stern. He added that families that don’t have a company helping them with the process face longer delays.

Genesis Vice President Larry Lane expressed frustration that New Jersey officials laid out exactly what needs to be done to improve the system when they state submitted its successful application to receive a five-year comprehensive Medicaid waiver, which is allowing the state to shift much of the focus of long-term care from nursing homes to home and community-based services.

The state said it planned to centralize, streamline and simplify the application process, Lane said.

“The difficulty is, we’ve seen very little effort to move forward with that,” he said, adding that Maryland and Pennsylvania have had success in updating their application systems.

New Jersey is now is more than halfway through that waiver period, which extends until June 2017.

Some nursing homes are looking more carefully at applications for people they aren’t legally required to accept.

Eric Allgair, vice president of Ocean County-based Hovnanian Senior Housing Services, said his company has started to turn down some applicants it previously would have accepted, because of the challenges involved in covering their costs while waiting for Medicaid determinations.

“We have to look those residents and families in the face when they’re at the hospital looking for discharge to one of our buildings and we have to tell them, ‘No, we cannot provide you services,’ ” he said.

The Assembly Health and Senior Services Committee released the bill in a 9-0 vote on Monday. Assemblyman Gary S. Schaer (D-Bergen and Passaic) is the primary sponsor of the measure.