I went to high school in Iowa, where 19 nursing homes closed in 2022 alone.
Surely, you might think, this has prompted a federal response. After all, the federal government, through the Centers for Medicare & Medicaid Services, approves Medicaid State Plan Amendments. The federal government is currently footing 69.33% of Medicaid costs in Iowa until the enhanced Federal Medical Assistance Percentage (adding an extra 6.2%) dating to the Families First Coronavirus Response Act of 2020 is phased out. So, whether Medicaid funding covers care costs for Iowa’s most vulnerable citizens should be of some federal interest.
It isn’t. Instead, the federal government has chosen to bail out Silicon Valley Bank, and another institution, Signature Bank, upon whose board sat former US Rep. Barney Frank. Both banks were objectively risky, whether relying on a shaky tech sector or taking in considerable cryptocurrency deposits (reportedly $3.3 billion from one company alone in Silicon). Yet, unlike, say, your sagging 401(k), the feds are rescuing all of these banks’ customers with deposits more than the $250,000 government insures.
As Andrew Ross Sorkin, a masterful chronicler of the “Great Recession” precipitated by financial institutions in 2008, wrote in the New York Times: “Banking is now officially a government-backed business, if it wasn’t before. Let’s admit it: Once the government guarantees all deposits, the ‘business’ of banking isn’t much of a business[.]” Sorkin also noted that “[t]he venture capital community, a group that includes a vocal group of libertarians, was just bailed out.” In other words, government-haters begged for a government rescue and got it.
As for the Iowa residents and staff displaced by nursing home closures? Well, “Qu’ils mangent de la brioche!” Shame on them for not being politically powerful!
In New Hampshire, we have not yet seen the closures tragically afflicting Iowa and other states. Instead, we see atrophy, bed by unavailable bed, unit by offline unit, wing by closed wing. We have, according to February AARP data, the nation’s fourth-worst nursing home staffing shortage, and it is shutting the doors to those in need.
Simply to not turn away veterans our state Veterans Home needed a $7.6 million contract with a California staffing agency, because starting nursing assistants out at no less than $29,536 a year, with government benefits, evidently just wasn’t cutting it. Last I checked, a county-owned home had a wait list of 135 prospective residents. I have a member nonprofit facility that exclusively serves nuns, all poor as you can imagine, forced to pay a staffing agency $43 an hour for the services of a nursing assistant (a relative bargain, given what some are forced to pay), remitting checks to Texas. In one rural county alone, the average staffing agency utilization cost went from 71 cents a resident day in 2019 to $14.57 in 2021, an increase of over 2,000 percent.
And what might the federal response be to this crisis? A bailout? Or, given that a state like Iowa ignores one-fifth of care costs in its Medicaid parsimony, perhaps simply requiring states to pay such costs, which CMS is empowered to do? Don’t be silly. The response will be a new pile of unfunded expectations creating even greater reliance on staffing agencies. Because, you see, to be a politically connected financial institution means never facing real accountability (just one banker went to jail after 2008), while to be a nursing home provider, with government willfully underpaying you to care for the poor, is to be blamed for everything wrong with the world.
Brendan Williams is the president and CEO of the New Hampshire Health Care Association.
The opinions expressed in McKnight’s Long-Term Care News guest submissions are the author’s and are not necessarily those of McKnight’s Long-Term Care News or its editors.