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Assisted living providers in Minnesota say that the workforce situation is bleak and getting worse as industry leaders advocate for more funding to ensure career-sustaining wages for caregivers.

A recent survey by the Minnesota Long-Term Care Imperative, a collaboration between the state’s two largest senior living and care providers associations — Care Providers of Minnesota, the state affiliate of the American Health Care Association / National Center for Assisted Living, and LeadingAge Minnesota, the state partner of LeadingAge national and Argentum — shows that caregivers in assisted living communities are “reaching their breaking point,” as are those working in nursing homes, according to the collaborative.

The survey showed that in March, 6,582 referrals to assisted living communities were rejected due to inadequate staffing levels, up from October 2022 levels.

And the staffing shortage is affecting older adults and their families in every corner of the state, respondents said. Almost 40% of participating assisted living communities report not having enough licensed staff. The survey revealed that assisted living providers in greater Minnesota are struggling more than those in the seven-county metropolitan area to garner interest in open positions for aides.

Providers have dropped unfilled positions from their budgets without new funding and increased census, creating a “new normal” for staffing and access. The survey showed that 10.1% of greater Minnesota assisted living communities — and 3.2% of assisted living communities in the seven-county metro area — are considering closing. Slightly more than 22% (22.1%) of communities in greater Minnesota are considering sales, as are 8.1% of communities in the seven-county metropolitan area.

And more than 80% of assisted living communities considering selling or closing reported little to no interest in vacant positions.

Thirty-two percent of assisted living operators statewide said that they have exhausted their financial reserves, with the rate higher in the seven-county metro area than in greater Minnesota. 

Improve waiver rates would increase HCBS access

Among the legislative solutions being promoted by the Long-Term Care Imperative are paying caregivers increased wages and investing in Medicaid waivers used in assisted living and other long-term care settings.

A conference committee of state House and Senate members have been appointed to negotiate one final bill to be reconsidered by the legislature, but each remain far apart in agreement on certain points. 

The House version makes investments in the Elderly Waiver program, The Senate version has some funding for the waiver program but does not adopt a full transition to the new framework. 

One-third of assisted living residents are enrolled in the Elderly Waiver program in Minnesota. The program provides home- and community-based services for people who need a nursing home level of care but choose to live in the community. Improving waiver rates would grant more older adults access to settings such as assisted living, according to the Long-Term Care Imperative.

Almost 40% of responding assisted living communities (39.7% in the seven-country metro area and 39.3% in greater Minnesota) said there is “almost a 100% chance” that they will reduce capacity in the next nine months if state Medicaid reimbursement is not increased and the economic and workforce challenges continue. Additionally, more than 21% said that there is a 75% chance that they will reduce capacity.

Under the same conditions, 54.4% to 59.8% of assisted living providers said they almost certainly will close their communities in the next nine months.

The waiver program has been “woefully underfunded for years, failing to cover the cost of care, according to LeadingAge President and CEO Kari Thurlow. As the pandemic progressed and costs increased, the gap between the waiver reimbursement rates and the actual cost of care continued to widen.

“Underfunding means providers are put in the unfortunate position of limiting the number of Elderly Waiver clients they can serve,” Thurlow told McKnight’s Senior Living. “This funding increase will give more seniors access to the care they need, when and where they need it.”

She added that she remains optimistic that lawmakers will make the same level of investments in the entire senior services sector to ensure that older adults “can get the right care at the right time in all the places they call home.”

Patti Cullen, president and CEO of Care Providers of Minnesota, similarly said she has hopes for the final bill.

“We are thrilled to see the investment in the Elderly Waiver program for Minnesota’s frail seniors in assisted living included in the House proposal and hope the ultimate package includes this historical investment,” Cullen told McKnight’s Senior Living.

Along with increasing funding to the Elderly Waiver program, the initiative is advocating for Gov. Tim Walz (D) to increase the underlying Department of Human Services budget to ensure that caregivers across the continuum of care earn a career-sustaining wage.