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Controversy over nursing home funding underscores need to keep state’s provider tax

May 14, 2019 06:46AM ● By Editor

By Marty Stempniak of - May 14, 2019

The Minneapolis Star Tribune Editorial Board is defending local providers as legislators consider “catastrophic” cuts to nursing home pay.

Minnesota lawmakers are currently floating a proposal that would result in at least $68 million in pay reductions to the state’s nursing facilities over the next four years. Care Providers of Minnesota estimates that the tally could reach $200 million when including the loss of federal matching funding and other factors.

The Star Tribune on Friday urged Gov. Tim Walz (D) to convene a meeting with state nursing facility leaders “to listen to their concerns and find out if there are measures to mitigate the financial pain that would be felt, especially by smaller care centers.” It also implored state lawmakers to extend the provider tax that’s set to expire at the end of the year, which is “critical to ensuring the robust funding that nursing homes and their patients deserve.”

North Shore Health CEO Kimber Wraalstad said she is “literally losing sleep at night” over the potential cuts. If enacted, her 37-bed facility in rural Grand Marais, MN, stands to lose $83,000 in 2020, which would climb to $220,000 in 2023. The hospital-based long-term care facility is already operating at a loss.

Larger, city-based providers such as Sholom Community Alliance are similarly worried that such reductions cannot be absorbed when margins are already “perilously thin,” CEO Barbara Klick told the Star Tribune.

Minnesota advocates previously told McKnight’s that lawmakers were expected to begin joint discussions this month on two very different proposed spending bills, one of which did not include the drastic provider cuts. LeadingAge Minnesota President and CEO Gayle Kvenvold recently blasted the $68 million in cuts.

“The proposed change in cost-based reimbursement will create financial instability for nursing homes, hamper their ability to recruit and retain skilled caregivers who are the backbone of safe, quality care and undermine access to the care and services seniors need – particularly in the rural areas of our state,” she told McKnight’s.  

To read the original article and see related reporting, follow this link to the McKnight' website.

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