California nursing homes earned considerably more money from Medicaid after reimbursement rates were raised, but the money didn’t benefit direct-care workers or residents, according to a study by Charlene Harrington and colleagues at the University of California San Francisco. In fact, wages for nursing assistants actually fell slightly when adjusted for inflation, and patient care measures declined in several areas.

Medi-Cal reimbursements were increased by a law passed in 2004. In 2006, the first full year when the higher rates were in place, Harrington conducted her study. She found that average nursing home revenues had increased from $124 to $152 a day, but nursing assistant wages had not quite kept up with inflation. Meanwhile, the amount spend on patient care fell by 3.5 percent, according to Impact of California’s Medi-Cal Long Term Care Reimbursement Act on Access, Quality and Costs.

“The fact that they let the nursing assistant wages actually decline with inflation, I think there’s no excuse for that,” Harrington told the Los Angeles Times. “They’re the bulk of the workers and they’re the lowest-paid.”

But several other long-term care stakeholders - including a lobbyist for the Service Employees International Union, which helped push for the increased reimbursement - told the paper that the study was premature. Higher reimbursement rates had only just begun when it was conducted, they pointed out, and homes had had to wait for up to two years for the bump, making them wary of increasing fixed costs such as wages. Adding to their wariness, they say, is the fact that the law will expire next year unless the legislature renews it.

And yet, the article notes, the homes did increase some wages. Administrators now earn 13 percent more, and licensed nurses 9 percent more.

Elise Nakhnikian, Senior Online Editor
enakhnikian@phinational.org