Davidson: Medicaid rates for serving clients not keeping up

As an assisted-living provider with nearly 30 years of experience serving Spokane-area seniors, I am disheartened to see the Carlyle House plan to stop serving state Medicaid clients who suffer from mental health issues, and instead serve newly released prisoners as a halfway house.

While services like these are critically necessary, it’s distressing that the issue for operators of The Carlyle is financial – they simply must transition to a better reimbursed care model to stay viable. Apparently, our state pays more for the care of prisoners than it does for the mentally ill or vulnerable adults. This announcement on the heels of South Hill Senior Living, an assisted-living community serving mostly Medicaid-funded vulnerable adults, closing their doors due to financial issues has become a disturbing trend that must be addressed by the Legislature.

While I am not associated with either community I mention above, nor do I operate a high Medicaid payment building, I am confident that their financial issues are directly related to the 2017 minimum wage increase, without consideration from the Legislature for reimbursement for Medicaid clients. Washington is tied with Massachusetts for the highest minimum wage in the nation and scheduled for another increase next year, yet per an CNBC article we are 37th in the cost of living.

The current Medicaid rate for serving clients at The Carlyle averages less than $3 per hour for a comprehensive package of care and services, including meals, activities, health care coordination, medications assistance and other services designed to help individuals live an autonomous and productive life. These programs are critical for keeping people with mental illness out of the corrections system, where it is far more costly and far less therapeutic.

In assisted living, Medicaid rates have remained flat for over a decade. While both the House and Senate budget proposals included a vendor rate increase of 4 to 5 percent, these dollars do not close a rate shortfall of $30 to $50 million for the biennium. The failure to adequately fund this sector of long-term care is taking a toll, and individuals with mental health issues aren’t the only ones impacted by inadequate Medicaid rates.

The failure to adequately fund rates is limiting access to assisted living care for seniors and disabled individuals who are state Medicaid clients. DSHS reports that “while the total number of private pay ALF beds increased 14 percent between Fiscal Years 2009 and 2016, the number contracted to serve Medicaid clients has declined by 3 percent. This endangers not only client choice in the range of available long-term care options, but also the ability to transition low-care people out of more expensive nursing facilities” (Administration, 2016).

The Legislature can act by supporting a budget provision to address the rates issue and by creating a transparent payment system that actually covers the cost of care and services. It’s critical to do so sooner rather than later. The threat to access and quality cannot be ignored. Choices for care are being eliminated faster than they can be replaced.