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Community care center is braced for deep budget cuts

Vashon Community Care Center will face a significant reduction in state funds — and possibly deep and painful cuts in its programs — if Gov. Christine Gregoire’s proposed budget is passed by the Legislature this spring, care center officials say.

The governor, in an effort to stave off a projected budget shortfall of $8.5 billion, has proposed severe and sweeping cuts to myriad programs in the state. One — a 7.5 percent cut in Medicaid reimbursements to skilled nursing facilities — would result in an annual loss of $163,000 to the care center’s already bare-bones budget, according to Susan Tuller, the administrator at Vashon Community Care Center (VCCC).

As a result, the care center is turning to the community for help.

The board is mailing a postcard about the situation to all Island residents next week, encouraging them to support VCCC by voicing their concerns about the cuts to state lawmakers. Board members have also begun working with Vashon’s legislative delegation, asking the three lawmakers to intervene on the care center’s behalf.

“That is a potentially devastating cut,” Tuller said. “There would have to be dramatic changes here. The magnitude is huge.”

If the drop in Medicare reimbursement goes into effect, the nursing home would be in a difficult position and need to adopt a different model of care, Tuller said.

While they don’t know how they would meet the funding challenge, under consideration would be staff cuts or cuts to those VCCC programs not required for licensure: a well-attended foot care program for the elderly, food services for the Vashon Senior Center, transportation services and the entire adult day health program, a Monday-through-Friday operation that provides services to participating seniors and respite for their caregivers.

Among nursing homes, VCCC is particularly vulnerable to Gregoire’s proposed budget cuts, Tuller said.

Most nursing homes limit the number of residents with Medicaid. The Vashon care center, however, has never taken that approach; a commitment to care for people regardless of finances was one of its founding principles, Tuller said.

As a result, 80 percent of the residents in the nursing home pay through Medicaid, giving VCCC one of the highest Medicaid rates in the state. With the proposed cuts, 80 percent of the nursing home’s revenue would take a 7.5 percent cut, a budget hit out of line with the cuts other programs are slated to take, according to Tuller.

What’s more, many nursing homes are either part of larger nonprofit organizations, which can share some of the financial burden during an economic crisis, or are for-profit operations, which have some control over their financial picture. VCCC, a small, community-based nonprofit, doesn’t have that support.

“It is just us and our community on our Island,” said Tuller, who said she believes there is one other nonprofit community-based nursing home in the state.

The state’s budget woes have already caused a 3.1 percent cut to Medicaid reimbursement slated for April, May and June, and VCCC staff have been preparing for the larger proposed cuts for more than a month, Tuller said, trying to ready themselves for what might be coming July 1, when the next two-year budget takes effect.

Every staff person was asked to offer up cost-saving ideas, and some changes have come about: People are turning off lights more often to save on electric bills; they are recycling more to save on dump fees, and pay stubs are no longer being sent out in the mail, a move that saves $1,000 a year.

These are small savings, to be sure, but administrators hope the cumulative impact could make a difference.

“When you already exist on a fine line, we’re talking about adding up nickels and dimes,” Tuller said.

The largest expense the care center has is salaries and benefits, she noted. “That’s what we are. We are people who provide care for other people.”

But caring for people can be demanding work. Cuts to staffing would make that work even more difficult, Tuller said.

Cutting wages is no less painful than cutting staff itself, she added. Industry-wide, workers in nursing homes are paid little, a function of how the homes are reimbursed for their care, board member Lyn Davison said. While VCCC strives to pay workers at the top end of what nursing homes in the area pay, for many employees, their checks are still small. Many of its workers — housekeepers, resident assistants, certified nursing assistants and food service workers — earn less than $15 per hour.

“A percentage of our staff already goes to the food bank,” Tuller said.

They are some of this area’s working poor, and cutting their salaries further is an “unconscionable decision,” Davison said.

While nurses at VCCC make a professional wage, Tuller said, they make less than nurses in Seattle.

“I do not want to lose good nurses because we have to cut wages,” she added.

Creating a stable financial foundation has been difficult since VCCC opened its new building in 2002. In the past few years VCCC has met its operating expenses but has not been able to build up a large reserve for capital improvements, an area of vulnerability for the center. VCCC’s operating budget is based on a certain level of occupancy, and if the monthly census is off by even one or two people, that places financial stress on the system.

“We have no margin,” Davison said.

VCCC has tried to create a more stable financial model by looking into grants and developing services that would provide additional revenue. But Vashon poses challenges related to economies of scale, and the staff has yet to find a service that would offer the kind of sustainability VCCC needs, Tuller said.

While there have been some challenges with finances, Tuller said, the home as had many successes: good support from the community, an in-house certified nursing assistant program, the highest rating possible from the federal government and excellent care for the residents

“This place is living up to its promise,” Tuller said.

But promises to care for the elderly may not carry much weight in Olympia, where lawmakers are struggling with budget problems so severe that Washington now ranks in the top 10 of those states with the largest financial shortfalls, according to a recent Seattle Times article.

In a time with more questions than answers, many are looking to federal stimulus money for solutions. Stimulus money will play a role in the Medicaid funding picture, but as yet, people are not sure how much, according to Davison.

Medicaid is funded by state government and the federal government in proportions that vary from state to state. In Washington, the ratio had been 51 percent federal funding to 49 percent state funding. As part of the stimulus package, the federal government will now increase the rate it will pay, Davison said, with some estimating a 60-40 split.

But even with the federal government stepping up, the state — with its dire financial situation — may not be able to access all the matching federal funds and be forced to cut services and leave federal money “on the table,” Tuller said.

Rep. Eileen Cody (D-West Seattle), who chairs the House Health and Wellness Committee, said it is too early to tell what will happen with funding for the Medicaid cuts, but the situation with the shortfall is severe — and getting worse.

“The governor’s budget is the highwater mark,” she said, indicating that amount of money is the most the state will be able to spend.

Rep. Sharon Nelson, a Vashon resident, said that she has heard from some nursing homes throughout the state, adding they have reason to be concerned, given the budget situation Washington is facing.

Democrats are clear on their core values, Nelson added, and will address the budget with those values — which include health care — in mind. But even at that, she added, the situation is difficult.

“Most programs are going to take a cut because we do not have options,” Nelson said.

Meanwhile, Tuller said, she hopes the Legislature will find a way to make the cuts far smaller than 7.5 percent, a reduction that VCCC would meet with further cost-cutting measures, some new income-generating services and increased fundraising.

She also hopes Vashon residents will weigh in on the issue, using their voices to make an impact with lawmakers so that VCCC can continue to provide quality care for some of the Island’s most vulnerable residents.

“We are a mission-driven organization. We are here to serve the community. We are to be here when people need us,” Tuller said.

Contact your lawmaker

Here’s information for people who wish to contact their legislators about the budget situation and its impact on Vashon Community Care Center.

Sen. Joe McDermott: (360) 786-7667 or mcdermott.joe@leg.wa.gov

Rep. Eileen Cody: (360) 786-7978 or cody.eileen@leg.wa.gov

Rep. Sharon Nelson: (360) 786-7952 or nelson.

sharon@leg.wa.gov

For information on talking points, see the Web site at www.laboroflove.org or call Susan Tuller at VCCC at 567-4421.

 

Community Events, April 2014

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