Skilled nursing providers must agree to improve outcomes and accept accountability in exchange for higher government reimbursement, the industry’s top leader and a researcher concurred during a panel discussion Thursday.

Improvements in both staffing and infection control are needed to move the industry forward after the COVID-19 crisis revealed systemic flaws, agreed Mark Parkinson, president and CEO of the American Health Care Association / National Center for Assisted Living, and Harvard Medical School researcher David Grabowski, Ph.D.

But both efforts will require major increases in state-level Medicaid funding, and any future increases likely will be tied to outcomes-based metrics. Parkinson gave the candid assessment on a webinar hosted by Yale University’s Solomon Center for Health Law and Policy.

“We need to put money into the system,” Parkinson said. “But it has to be accounted for.”

He said incentives have been proven to work, offering ongoing efforts to reduce rehospitalizations as proof. He argued for the creation of new, specific staffing strategies and said that providers that don’t meet related benchmarks should be penalized.

“If we don’t improve quality, we should be punished and not receive the funds,” he said.

Grabowski said advocating only for higher staffing minimums would be “too limiting,” arguing instead that targeted Medicaid funding could help providers make nursing homes more enticing as employers.

“We already have vacancies,” he said. “ We need to make these better jobs. That takes money.” 

Grabowski outlined his vision of what those better jobs look like in a Politico article Thursday. He called for higher pay, more benefits to include sick leave, providing career advancement and improving the culture of nursing homes — all of that supported by increased industry transparency and higher reimbursements.

Expect return on investment

Asked whether the industry needed more money or better regulation of the funding it already receives, Grabowski said he didn’t think policymakers could do one without the other.

“We’re going to give the industry something, but we’re also going to expect something,” he said. “That’s a fair trade.”

Other speakers called for more focus on home- and community-based services. Shawn Bloom, president and CEO of the National PACE Association, said his sector has a unique opportunity to attract more support, given the increased interest in care-at-home during the pandemic.

States that budgeted more Medicare dollars than they spent during the last 12 months because of reduced referrals to skilled care might now be encouraged to use those savings to invest more in community care options.

Lori Smetanka, executive Director for the National Consumer Voice for Quality Long-Term Care, questioned whether nursing homes really needed a funding infusion, given that seniors want “affordable, accessible options,” often at home.

Parkinson pushed back against that storyline, saying MedPAC research has shown the industry is working with margins close to zero.

He said the best approaches to strengthening nursing homes would be data-driven and suggested COVID-era research indicates increasing the number of registered nurses in skilled nursing facilities and shoring up infection control practices were ideal places to start.

“Let’s take a really honest look at the data,” Parkinson said. “We owe it to this population to take a clear and objective look to prove what actually works.”