Nursing Homes Get Financial Bump As Lawmakers OK Health Care Bill

Sens. Lourey, Dibble

By Danielle Killey

Nursing homes and other care facilities will get more state money than they have seen in years.

Sen. Tony Lourey, DFL-Kerrick, said the budget plan lawmakers approved last week includes “the largest state investment in the nursing home industry in well over a decade.”

But others say it is not enough for the organizations.

“This is going to let them limp along for a while, but this is not what we should be doing,” Sen. Julie Rosen, R-Fairmont, argued.

The Senate approved the health and human services budget 39-28 Saturday, after the House voted 73-61 late Friday. Like most budget bills, the votes largely were along party lines, with Democrats in charge of the Legislature backing their budget decisions.

The more than $11 billion is a significant portion of the state’s two-year, $38 billion budget, second only to public education spending.

The bill includes a 5 percent rate increase for nursing homes in the next two years, half what they wanted.

Long-term care and other providers will see a 1 percent rate increase effective April 2014.

“This is the first time in four years that we actually have an increase in wages for nursing home workers and long-term care workers,” said Rep. Tom Huntley, DFL-Duluth.

Lourey said it was time to start increasing funding after “devastating cuts” in past budgets.

“Health and human services takes the lion’s share of the budget balancing around this place year in and year out,” Lourey said, referring to cuts in the budget during tough fiscal times.

Providers said while the increase will help avert immediate crises at nursing homes and long-term care facilities, more work is needed in the future.

They had asked for a 5 percent increase each year in the next two years. They said without funding increases, many facilities are losing employees to higher-paying jobs and many nursing homes risk closing due to fiscal problems.

Rep. Paul Torkelson, R-Hanska, called the 1 percent hike for care workers for the disabled “embarrassing.”

Huntley said it is one part of the bill he did not like.

“I have always been committed to treating them exactly the same as I treat nursing home people, and I was unable to do that,” he said. “I’m disappointed with that myself.”

Republicans said not funding that fully was a case of misplaced priorities. They also argued some other changes will cost nursing homes money, so they will not fare as well as it seems.

“We have a questionable priority system here,” Rosen said. “We are raising taxes by $2 billion and we cannot fully fund the long-term care industry.”

The health and human services budget originally was to be $150 million less than the current budget, but the conference committee improved that to $50 million, “which made things a lot less painful,” Huntley said.

“That really helped mitigate a lot of problems with the bill,” Lourey said.

Gov. Mark Dayton proposed a $127 million increase in HHS funding.

The bill includes some savings from combining cuts and reforms such as savings from the federal Affordable Care Act and bumping up the date HMOs and hospitals pay their existing state surcharges.

HMOs also can no longer bill the state for salaries higher than $200,000, advertising, penalties, fines or charitable contributions.

Gone from the bill was a proposed hospital surcharge, which Huntley said he was happy to have erased.

The bill also includes expanded programs for mental illness care, including in schools.

“We still have work to do to help our hospitals and nursing homes in the future, but I’m happy to vote for this step in the right direction,” said Rep. Jay McNamar, DFL-Elbow Lake.

The governor is expected to sign the bill.

“This bill finds government efficiencies that will allow for some cost-of-living raises for nursing home workers in our communities,” said Rep. John Persell, DFL-Bemidji.

Rep. Roger Erickson, DFL-Baudette, said the raise is needed.

“This budget will provide a well-deserved raise for those workers who do such crucial work in nursing homes across Minnesota,” Erickson said. “They have been waiting for a raise for far too long, and I’m happy to vote in favor of it.”

Rep. Andrew Falk, DFL-Murdock, said nursing homes need the increased funding.

“We know that our nursing home workers need more support from the state,” Falk said. “This bill gives them a pay increase that is well-deserved, and it helps make responsible reforms to one of the biggest areas of our budget.”

Rep. Mary Sawatzky, DFL-Willmar, said workers deserve the increased funding.

“After a decade of cuts and four years of wage freezes for nursing home providers, this increased funding is desperately needed,” she said. “Our seniors and nursing homes are a vital part of our communities, and they deserve our support.”


Here are some highlights of the Minnesota Legislature’s health and human services bill:

— Total spending in the next two years, $11.3 billion

— Cut from the current budget, $50 million

— Nursing home funding increase, 5 percent; long-term care increase, 1 percent

— Statewide health improvement program funding, $35 million

— Additional funds for school mental health services, $7.4 million