For skilled nursing providers, this federal dataset provides support for state-level Medicaid rate reform.
We found that Medicaid payment rates for the average or median nursing home covered about 82 cents per every dollar of reported cost nursing homes incurred caring for Medicaid residents. For approximately 40% of nursing homes, Medicaid per diem payments covered 80% or less of their estimated per diem Medicaid costs. The majority, or 52% of nursing homes, had 80-100% of their Medicaid per diem costs covered; and the remaining 8% had payments exceeding their per diem costs. Not-for-profit nursing homes had the lowest Medicaid payment-to-cost ratio compared to for-profits and government-owned nursing homes.
Nursing homes with total nursing staff levels below 3.00 hours per resident day had the highest average Medicaid payment-to-cost ratio of 0.85, whereas nursing homes with nursing staff levels above 4.0 hours per resident day had the lowest average Medicaid payment-to-cost ratio at 0.77.
— ASPE/HHS, October 11, 2024
Bowblis, John R., et al. “Assessing Medicaid Payment Rates and Costs of Caring for the Medicaid Population Residing in Nursing Homes: Final Report.” ASPE/HHS, 11 Oct. 2024. https://aspe.hhs.gov/reports/assessing-medicaid-payments-costs-nursing-homes.
In Case You Missed It: New HHS Report Reveals Significant Medicaid Shortfall For Nursing Homes
“If a nursing home wants to make investments in quality improvement, whether that be [improving] staffing levels or paying workers more to lower turnover, that means they need to have adequate financial resources. And that’s not going to be feasible given the current payment models.”
— AHCA/NCAL, October 22, 2024
“This study is unique because unlike previous work it examined the relationship between payment and costs on a facility-by-facility basis, rather than, say, state average reimbursement levels,” Edward Miller, professor of gerontology and public policy at the University of Massachusetts Boston, told Skilled Nursing News. “We also bring an independent and unbiased eye to this issue, thereby alleviating concerns with prior industry-led analyses.”
— Skilled Nursing News, October 18, 2024
Report Reveals How Medicaid Payments Stack Up Against Nursing Homes’ Cost of Care
A new government survey of 13,285 US nursing homes has found that the average provider received 82 cents on the dollar from Medicaid for the costs accrued while caring for beneficiaries. “One of the questions that we always ask is whether we’re adequately paying nursing homes for the cost of the services they are providing, right?” noted report co-author John Bowblis, PhD. “If a nursing home wants to make investments in quality improvement, whether that be [improving] staffing levels or paying workers more to lower turnover, that means they need to have adequate financial resources. And that’s not going to be feasible given the current payment models.”
— McKnight’s Long-Term Care News, October 16, 2024
ASPE Report: Medicaid Payments to Nursing Homes Average 82% of Costs of Care
On average, Medicaid rates paid were 82% of costs to provide services, though variables were evident based on staffing patterns, ownership type, and occupancy. Nonprofit nursing homes were found to have a lower mean Medicaid payment-to-cost ratio (0.76) than for-profit and government-owned nursing homes (0.83 and 0.80, respectively).
— LeadingAge, October 16, 2024
Medicaid Payments Fall Far Short of Covering Care Costs at Nursing Homes
Medicaid payment rates are insufficient to cover the costs of care, according to a new study that highlights the growing financial challenges faced by nursing homes serving Medicaid residents. The research, conducted by the LeadingAge LTSS Center at the University of Massachusetts Boston and Miami University, reveals a widening gap between Medicaid reimbursement rates and the true cost of providing long-term care.
— Skilled Nursing News, November 21, 2024
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