Skilled nursing facility workers contracted through staffing agencies earn 40% to 84% more than in-house labor at rates that have grown far faster than inflation, according to a new report from a legislative committee tasked with investigating agency practices during the pandemic.
The report from the Pennsylvania State Government Commission also made numerous recommendations on improving working conditions at in nursing homes, including raising wages, improving training and career development, and fighting “negative stigma.”
On July 1, facilities a minimum staffing rule will increase required hours of direct care per resident per day from 2.7 to 2.87. That will again increase in July 2024 to 3.2 hours of direct care per resident per day.
Despite a 17.5% increase in the Medicaid reimbursement rate in 2017, the Pennsylvania Health Care Association said that a lack of funding and the increase in staffing requirements will lead to a “silver tsunami” that will strand older Pennsylvanians without care.
“This report is yet another warning for responsible action,” association President and CEO Zach Shamberg said in a statement Tuesday to McKnight’s Long-Term Care News. “Pennsylvania must address the issue of sustaining long-term care before the wave crashes and residents need to be rescued.”
The report noted that the long-term care sector requires a $99.9 million annual investment to cover the full costs of services, which would translate to an average increase of $12.50 per resident per day for a Medicaid reimbursement of $263.05. That increase is one of seven recommendations in the report.
The other recommendations are to:
• Increase the wages of direct care workers, 40% of whom were part of households earning wages 200% below the federal poverty level in 2019.
• Improve the work environment of direct care workers by enforcing disciplinary rules, protecting health workers from violence in the workplace, and ensuring adequate staff.
• Establish a quality-based reimbursement system to incentivize better care.
• Improve training opportunities for direct care workers.
• Provide direct care workers access to more career development opportunities.
• Address the negative stigma surrounding direct care in Pennsylvania.
The report also went after staffing agencies, whose prices have soared during the pandemic.
“The estimated 45 to 75 percent mark-up rate by agencies for providing contracted workers may be typical of their industry, however, they are not costs the Pennsylvania long-term care system can sustain,” report authors wrote. “While there will likely always be situations which demand the use of contracted workers, given the nature of how skilled nursing facilities are funded, use of contracted staff should be kept to a necessary minimum.”
In 2022, the average wage for an in-house RN was $35 per hour, compared to $48 per hour for a contract worker; $24 per hour for an in-house LPN, compared to $35 for a contractor; and $15 per hour for an in-house CNA, compared to $28 for a contractor, according to the report. It also found that the full cost of salary and wages paid to agencies can be twice the cost of non-contracted labor.
Meanwhile, the number of beds available for residents declined by 4.7% from 2013 to 2022. Researchers also noted that the cost of a private bed in a Pennsylvania SNF is $116,800 – $24,000 more than the national median.
