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Nursing home owners blame Medicaid shortfalls for staffing struggles. Critics say they're being cheap for profit

Springside hall (copy)

A hallway at Springside Rehabilitation and Nursing Center in Pittsfield. 

The people who run Berkshire County’s nursing homes agree with their critics that workers need better wages — and the buildings need more staff — to provide a higher quality of care.

They disagree about how to do this, however, as well as why a longstanding staffing crisis persists. Nursing home owners say they are dependent on state Medicaid reimbursements that don’t cover the cost of care. This prevents them from staffing up and hiking wages, they say.

Health care analysts, advocates for the elderly and those who work in facilities dispute that.

They say the industry could do more to compensate workers and increase staffing, but instead allocates resources to other things — including administration and salaries.

“They’re making tons of money off these elderly people who worked their whole lives,” said a former aide in a county facility who does not want their name published for fear of retaliation as they continue to work in the industry. “And they work these [aides] to death and neglect the residents.”

A staffer at another Berkshire nursing home said the company is two years behind in cost-of-living wage increases. “It’s very thankless work,” they said. “It’s a hard job, the hours are demanding, and you’re dealing with people who are suffering.”

It is also “sacred work,” said Christopher McLaughlin, executive director of Elder Services of Berkshire County, whose volunteer ombudspeople advocate for residents. McLaughlin, who used to run nursing homes, said CNAs need better pay. He also understands the travails facing administrators as they look for workers.

“If [staffing] was dire before the pandemic, it’s a never-ending struggle now,” McLaughlin said.

It is those in the care of nursing homes who pay the highest price, an Eagle investigation found.

The newspaper analyzed federal staffing data before, during and after the pandemic in Berkshire County facilities and found that staffing levels, measured in nursing care hours for each resident every day, fell below federally recommended staffing minimums and under new levels set by the state.

While workloads and risk to staff and residents increased during the pandemic, staffing levels didn’t change significantly.

A review of the U.S. Centers for Medicare and Medicaid Services payroll-based data, as well as inspection reports, revealed that Berkshire County nursing homes are, like most nationwide, understaffing facilities to the detriment of residents and workers.

Elder advocates and those who study the industry say this is intentional scrimping for profit, as the cycle of worker burnout continues and repels people from this workforce. People who run nursing homes say they are working through all kinds of programs and offering incentives to hire and retain staff.

Yet, the cycle of suffering persists.

Instead of coddling nursing home owners, state regulators should step up enforcement of facilities as a way to raise staffing levels, said Charlene Harrington, professor emeritus at the University of California-San Francisco’s School of Nursing, who has analyzed the industry for four decades.

“[State regulators] are especially feeling sorry for the nursing homes because of COVID,” Harrington said. “It’s just wrong. They need to be cracking down on them. Nursing homes can save as much as a million dollars a year by understaffing. So, that’s big money. And if the state doesn’t go after them, they get away with it.”

A spokesperson from the Massachusetts Department of Public Health said its routine, and sometimes unannounced, inspections are a way to ensure “safe, high-quality care.”

Harrington said that federal payroll reporting requirements that began in 2018 have made it harder for facilities to game the system around staffing hours.

“There’s all kinds of tricks, but they’re not supposed to be doing it,” she said. “One of the problems is that [U.S. Centers for Medicare and Medicaid Services] hasn’t been enforcing it very much. CMS does have an audit of staffing, but they only audit about 1,800 nursing homes out of 16,000.”

A CMS spokesperson did not respond to questions about why the agency does not enforce its recommended minimum staffing levels.

Nursing home executives say a declining population in this rural county over the last decade also contributes to staff shortages. A number of operators say they are forced to hire agency or traveling nurses at a steeper pay rate. Critics say the owners are simply being cheap.

Others say it isn’t simple.

State-of-the-art Berkshire Place ready for skilled-nursing patients (copy)

In 2014, Carmella Scelsi looked at her new room at Berkshire Place in Pittsfield, with activities director Debbie Dudak. The nursing home has had some of the best staffing levels in the county over the last decade.

“The truth sort of lies in the middle,” said David Grabowski, a professor of Health Care Policy at Harvard Medical School, who has studied staffing and turnover rates in nursing homes. In Massachusetts that annual rate is 92 percent, higher than those in roughly half the U.S. He said this is likely due to the high cost of labor in the state, and MassHealth, the state’s Medicaid program, not covering the true cost of care.

He says “blunt staffing standards and wage floors” for workers are needed.

“We do need more money in the system, but if we’re going to pay these facilities more we have to expect more from them,” Grabowski said. “They don’t always put the money into care.”

Competing with Dunkin’?

This is why Massachusetts now requires nursing home operators to spend at least 75 percent of total revenue on the direct care of residents. The rule was set by Gov. Charlie Baker, based on the report from a Nursing Facility Task Force that assembled in 2019, made up of advocates, state, industry and union officials. It spawned the Nursing Facility Accountability and Supports Package, which allocated $82 million to increase reimbursement rates, and established other ways of boosting quality care and safety.

Industry officials say it isn’t enough, and continue to press the state to pump up investment. The gap between care costs and reimbursements for each resident is more than $25 a day, said Tara Gregorio, president of the Massachusetts Senior Care Association, and a member of the task force. Roughly 75 percent of long-term care residents are on MassHealth.

Gregorio said a recent state report showed the industry as a whole hasn’t been profitable for years, operating at a 3.2 percent negative margin. “A facility’s ability to invest in our workforce is directly tied to adequate government funding,” Gregorio said.

That new restructuring package also mandated specific staffing minimums that went into effect in March 2021. The state would dock MassHealth reimbursements at 2 percent per quarter for any staffing dips below the new level, which is set at 3.58 total minimum hours that caregivers spend with a resident each day.

While it is a higher level than mandated staffing hours in most states, that new level is well below what is considered safe: a minimum of 4.1 hours-per-resident-per-day, including care by a registered nurse, licensed professional nurses and certified nursing assistants.

“4.1 is the baseline for preventing harm,” said Arlene Germain, policy director at Massachusetts Advocates for Nursing Home Reform, and co-founder of Dignity Alliance Massachusetts. “It doesn’t mean you’re going to have quality care.”

Germain, whose group is working to fix these and other industry problems at the legislative level, noted that the 4.1 figure was established by CMS in a landmark 2001 study and in a slew of papers by other researchers that followed.

She said one way out of this cycle is to elevate certified nursing assistants by paying them appropriately and allowing them help make decisions at work. Wages for a CNA in Pittsfield fall between $14.70 and $17.04 per hour, according to work websites like Indeed and Payscale. The average CNA hourly wage in the state is $17.86, according to the U.S. Bureau of Labor Statistics’ most recent data as of May 2020.

Between 2014 and 2019, starting CNA wages increased from $11 per hour to $13 per hour, hovering just about the state’s minimum wage, according to statistics compiled by the state’s Nursing Home Task Force.

Nursing home operators say they’re all for higher staffing minimums and wages, but with MassHealth shortfalls, it amounts to an unfunded mandate. Also, they say their fixed costs continue to rise, especially with inflation.

“The 4.1 — the advocates are pushing for that, and that scares me,” said Kevin Morris, president of BaneCare, and the owner of a number of the company’s 12 assisted living and nursing facilities in the state. The company owns Springside Rehabilitation and Skilled Care Center in Pittsfield, which is flagged by regulators for past abuse, and was fined last year for neglect during a COVID-19 outbreak. BaneCare also owns Craneville Place of Dalton Rehabilitation and Skilled Care Center and an assisted living complex, also in Dalton.

“The problem goes back to the fact that we don’t establish our own reimbursement rates,” he added.

At Springside, these come up $28 short every day for each resident, he said. “The facilities aren’t making money like people think they are. If you start pulling cost [expense] reports, your head’s going to explode.”

Room at Springside (copy)

A room at Springside. Local officials and lawmakers say they are turning their attention to the Lebanon Road facility in the wake of the reports of neglect.

The company recently told residents who pay out-of-pocket that their daily rate would increase by $15 per day to offset rising costs. At Springside, available beds are 78 percent full because there aren’t enough staff to handle a full building, Morris said. “Our staffing is not utopian by any means, but we’re improving every day.”

Wage competition with doughnut chain Dunkin’ is a common refrain. Morris said that unlike his company, the food franchise can hike the price of its products and pass the increase to customers.

Berkshire Healthcare executives said the same. They say the not-for-profit company, which runs six county nursing homes, including Hillcrest Commons Nursing and Rehabilitation Center in Pittsfield, is dedicated to its residents and to high-quality care. Staffing shortages have forced them to fight to hire and retain workers, and to be competitive with wages.

Now they’ve got a new, pandemic-related economic hurdle: a universal worker shortage in which other businesses are offering higher starting wages.

“If the CNA’s alternative is to go pour coffee at Dunkin’ Donuts for $18 an hour, we have to be able to compete with that,” said William Jones, president of Berkshire Healthcare.

While Jones may overstate the starting hourly wage at Dunkin’ — the minimum wage in Massachusetts is now $14.25 for 2022, up 75 cents from 2021 — he is alluding to higher wage offerings by companies desperate for staff. Jones, along with four other members of the company’s senior leadership team interviewed by The Eagle, all agreed with advocates who say nursing assistants are undervalued.

“We value them and agree that the world needs to value them in the way that we see their contribution,” said Jill Zucco, the company’s vice president of operations.

One certified nursing assistant in Berkshire County noted the lack of a local union, and wondered if that would help. Collective bargaining is making advances, according to union officials who represent nursing home workers in some parts of Massachusetts and other states in the region.

“We’re seeing gains in our contract negotiations, not just in Massachusetts, but wherever we represent workers across the country,” said Tim Foley, vice president of the state’s AFL-CIO, who represents the 1199 Service Employees International Union. “We are fighting for a wage of $20 per hour as a base for CNAs and we’re making progress.”

The union, which represents workers in 32 of the state’s nursing homes, was a leading force in calling for a review and higher standards, particularly with regard to staffing, said Foley, who also was a member of the Nursing Facility Task Force. He noted that this all was on the table before COVID-19.

One caregiver said the entire nursing home system needs an overhaul, given a normalized state of neglect and abuse, and regulators who aren’t aggressive enough.

“The wages are deplorable, the fine [for a facility violation] is a hiccup,” the staffer said. “I think a new model needs to be established.”

Francesca Paris, The Eagle's data and public records reporter, contributed to this story.

Heather Bellow can be reached at hbellow@berkshireeagle.com or 413-329-6871.

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