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Nursing-Home War Hints at Nepotism

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Title of article: Nursing-home war hints at nepotism


Author: Catherine Candisky

Date: May 20, 2011

Economic subject: The Government Sector in Chapter 7

Summary: Catherine Candisky discusses that Governor John Kasich wants to include in his budget plan to cut state aid to nursing homes by $427 million over the next two years. What this means is Medicaid reimbursement rates to the nursing homes would be reduced by seven percent which is $164 a day, and payments to hold beds for patients while they are in the hospital or leave temporarily to visit family would no longer be available. Governor Kasich states nursing homes in 2009 spent $65.5 million to employ owner's family members and for side businesses such as landscaping.

Relevance on Households: If this is in the budget plan, and he reduces Medicaid spending, this means family members would have to come up with extra money a month to provide the nursing home for the expenses such as medicine and food for their family members. Also, more stress on the family members is if their loved one is hospitalized and is then released, will they have a room in the nursing home or would someone else have it because nursing homes can no longer hold their rooms.

Relevance on Business: Nursing home administrators say they are not getting paid a higher salary than normal wage. They put a lot of money back into the facility, into continuing to improve resident care, improve the building and grounds, and improve quality of life. They are constantly trying to improve the quality of life for our residents. If the Medicaid is reduced, this will cause some nursing homes to close, and there will be job cuts statewide of around 7,000 which will reduce the level of care for nursing home patients.

Relevance on State: The state budget plan would cut $427 million over the next two years; however, the unemployment rate would go up if there was 7,000 nursing home jobs cut. Governor John Kasich's budget plan would reduce Medicaid spending and would mean that Medicaid patients would be moved out of nursing homes and into home and community-based care programs such as PASSPORT. One way to reduce costs to the facility is by directing patients to rehab services, physical therapy, and speech therapy that are owned by skilled nursing centers.



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