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A bill that would extend the amount of time that Wisconsin assisted living communities, nursing homes or managed care organizations are required to notify residents of eviction or relocation is being called “well-intentioned,” but it ultimately fails to address low Medicaid reimbursement rates, provider organizations said.

SB 155 / AB 162 would extend the warning that residents and their families receive regarding relocation or eviction from 30 to 90 days. Senior living organizations said that they are not against expanding the time but also pointed out that the underlying reason for some of those evictions is due to lack of funding to maintain staffing. 

The decision to ask a resident to relocate is “terribly difficult” for everyone — residents, families, staff members and providers, Rick Abrams, CEO of the Wisconsin Health Care Association / Wisconsin Center for Assisted Living, told McKnight’s Senior Living.

“In so many instances, the resident and staff have built a strong relationship of humanity and care that is not easily broken,” he said.

Relocations typically arise for one of three reasons: 1) the community or facility is closing, 2) a formerly private-pay resident converted to Medicaid but the community or facility already is at capacity for Medicaid recipients, 3) or the community or facility was unsuccessful in negotiating a fair payment rate with the managed care organization under Family Care/Medicaid, Wisonsins’ home- and community-based waiver program.

SB 155, Abrams said, does not address the surprise notice of discharge, which often is overlooked in admission agreements. Extending the notice to 90 days, he said, has marginal utility in addressing the surprise factor for families and residents and is impractical from an immediate community/facility closure standpoint if the closure is the result of lack of operating funds, placing residents at risk of not receiving the care and services they need.

He also said that the extension can provide an incentive for a managed care organization that is in the midst of negotiations with an assisted living community to walk away from the table earlier in the process.

“At a minimum, we are seeking an amendment that would require the MCO to honor an existing agreement, if there is one, until the resident can be relocated or the parties are able to negotiate a fair payment rate for the resident’s care,” Abrams said.

LeadingAge Wisconsin provided written testimony to the state Senate Committee on Health, indicating that its members did not discharge residents during the COVID-19 pandemic if they exceeded a community’s care limits or if they ran out of funds, because of the lack of safe places to relocate residents. 

To make up for those Medicaid residents, private-pay residents saw their rents hiked. LeadingAge Wisconsin President and CEO Jim Orheim stated that those increases no longer are sustainable for those residents. 

Addressing the ‘real problem’

More often than not, an assisted living community is exiting the Family Care Program due to reimbursement rates that are lower than the actual cost of providing care, particularly as wages and expenses continue to rise, Wisconsin Assisted Living Association President and CEO Michael S. Pochowski told McKnight’s Senior Living. 

“WALA is concerned with Senate Bill 155 because it proposed to increase the burden on assisted living facilities and could extend for up to three months a provider receiving an inadequate reimbursement rate,” Pochowski said. “The legislation is attempting to deal with a symptom of the actual problem — an underfunded Family Care program that does not recognize market wages and the true cost of providing care.”

Orheim called involuntary discharges “rare and extremely unfortunate, occurring only in exceptional circumstances.”  He said the “real problem” is the Medicaid Family Care system, which is in need of reform. 

“By not providing reimbursement for services that adequately reflects the cost of care, providers are often faced with using the possibility of discharge as their only means of securing fair treatment from managed care organizations,” Orehim stated. “None of our provider members want to put the elderly in the middle of business decisions, but it is becoming an unfortunate consequence of the current program design and one which we encourage this committee and others to thoroughly review.”

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