The coronavirus hit the long-term care industry like an earthquake, and as with most disasters, a rebuilding period must follow.
As New Jersey examines ways to better prepare long-term care providers for the next crisis, our state’s leaders must also find ways to steady the ground under an industry continually shaken by financial woes, worker shortages, and stunted growth and innovation.
Some of those sustainability discussions have already begun. As recently reported, New Jersey’s long-term care associations have begun pleading with the Murphy administration for some of the $200 million in additional Medicaid money the state received from the federal government for pandemic relief.
Expenses have soared during the pandemic, with providers not only struggling to pay for higher equipment and staffing costs but also losing revenue because some clients went home to be with their families during the crisis, and new clients can’t be enrolled.
An immediate financial fix is sorely needed, but crisis is often the best teacher. Future conversations will need to include an examination of what works well, what doesn’t, and how the industry can better serve individuals at all income levels.
Challenges in long-term care
As members of the New Jersey Assisted Living Program Provider Coalition, we think our provider organizations are key pieces of a puzzle that must be solved soon: how New Jersey can affordably and efficiently provide long-term care to a rapidly aging population.
Our service model was created decades ago, when assisted living residences began to open across New Jersey, but were priced out of the reach of many low- and moderate-income older adults. To their credit, New Jersey regulators devised an innovative solution — creating a Medicaid program to pay for “portable” assisted living services to be based in low-income senior housing communities.
Thousands more low-income older adults here could likely benefit from New Jersey’s Assisted Living Program — offering the state potentially more Medicaid savings — but the 15 licensed providers currently serve only a few hundred people.
Expanding our reach has been difficult because, although New Jersey’s regulatory model endorses the concept of “choice” in long-term care, few people are versed on the full range of available alternatives. Many of our programs are operated by nonprofits without marketing budgets. We also aren’t in the resource lists of the widely advertised elder-care locator companies, which don’t promote Medicaid services nor list programs that can’t afford to pay them referral fees.
Despite their relative obscurity, Assisted Living Program providers endure the same cyclical threat to sustainability and growth that is common across the field of long-term care: insufficient government reimbursements, which result in underpaid direct-care workers, which contributes to troublesome workforce shortages, which limits expansion, which constricts profit margins, which limits growth.
Adapting when pandemic hit
Those were the challenges before the coronavirus muscled its way to the top of our industry’s troubles. Now, just like nursing homes, our providers are straining under a crush of new expenses, such as for N95 masks, gowns, face shields, booties and caps that care workers need to provide personal care to clients in their apartments as well as hand sanitizers, disinfectant products and paper goods, all of which are a struggle to find. Many of our programs are staffed leanly and barely break even, so the additional expense of overtime for workers replacing those who must quarantine and the additional time spent on new duties or on acquiring protective gear are adding new pressures on top of old ones.
Our care model is designed to be flexible, so in many ways we were able to quickly adapt when the pandemic hit — taking on a range of new responsibilities after our clients were cut off from food, social connection, wellness activities, transportation and other basic services when senior centers and other supportive service programs closed.
Some of our providers sent their staff on runs to grocery stores or created their own food banks to make sure clients’ shelves were stocked; others organized socially-distanced hallway games and social hours to give isolated residents some much-needed entertainment; and most found ways to link clients with the technology needed for telemedicine visits or to video-chat with their relatives. One of our program operators even started sewing masks himself when he needed more for his staff and clients.
But we have no promise of additional Medicaid reimbursements for the sharp rise in expenses we’ve experienced, and like nursing home operators, we are concerned about staying afloat without some assistance and intervention from the state.
It is in the state’s interest for our programs to not only survive, but also serve more people — and in more locations.
State needs to step in
Without our services, residents who need just a little bit of assistance to keep living independently in their affordable apartments would likely end up in a nursing home, unable to afford the rates of assisted living facilities, few of which accept direct admissions of Medicaid clients. The result of such premature nursing home admissions would be the state paying a bill that is roughly $60,000 higher per resident, per year.
Ultimately, if New Jersey wants to relieve pressure on its nursing homes — and on its Medicaid budget — the state’s leaders need to change reimbursement rates and the rules that too often make it hard for people to choose alternative care options.
Medicaid has uniform eligibility rules that don’t translate well to our unique model of care. The state’s strict spend-down rules, for example, don’t allow enrollees to keep enough money in the bank to pay for the unexpected expenses that older adults living on their own commonly face — such as a car repair or a family emergency.
Many years ago, our state’s leaders embraced a philosophy of “choice” in long-term care, recognizing that older New Jerseyans have diverse care needs and differing abilities to pay for them. But we haven’t yet constructed a system where everyone — regardless of income — has an equal opportunity to be cared for at home rather than in an institution.
As this crisis has already taught us, we need steadier ground underneath our long-term care industry, and then we need to keep building on it.