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Paynesville Press - April 27, 2005

State debating funding increase for nursing homes

By Melissa Andrie

For the last few years, no changes have been made to the funding given to nursing homes by the state, but this year the Minnesota Legislature is looking at several proposals offering increased reimbursement.

Currently, one of three geographical designations is given to each county, based on operating payment rate and subsidies, according to David Brown, a communications officer in the Minnesota Department of Human Services.

The amount of funding received by a nursing home is partially determined by its designation, so Koronis Manor, in Stearns County, which is considered semi-rural, receives more funding than the Hilltop Care Center, though both are owned and operated by the Paynesville Area Health Care System. This is because Hilltop Care Center is located in Watkins, on the edge of Meeker County, which is considered rural by the state.

"There's a great disparity in this reimbursement," said Sen. Dean Johnson (DFL-Willmar).

Sen. Michelle Fischbach (R-Paynesville), who believes the funding will be changed in some way this session, voiced the same opinion. A bill has been introduced in both the House and the Senate that, if passed, would change the designations of Stearns County, along with neighboring Sherburne and Benton counties, from semi-rural to metro, increasing nursing home rates for all facilities in those counties.

Rep. Bud Heidgerken (R-Freeport), who is the chief author of that bill in the House, noted that Stearns County is the only federally-designated metro area that is not considered metro on the state level and said that this bill addresses the inequalities facing these counties under the current system.

In both the House and the Senate, that bill has been passed to the Finance Committee to be considered as part of the final health finance bill. Similar legislation was passed in last year's session, according to Heidgerken, but it did not take effect because no new money was put into overall nursing home funding.

Another bill is being considered which would leave counties with their current designations and increase funding for all types by three percent for each of the next two years, making a six percent increase over the biennium. The bill requires that two-thirds of the increased funding would be spent on wages and benefits for employees.

Rep. Dean Urdahl (R-Grove City) supports funding directed at finding and retaining good employees for nursing homes, though he believes that there is some unfairness in the current system of three geographical types. His District 18B includes Meeker County, which with the rural designation gets the lowest tier of reimbursement.

This current system would be eliminated by another proposal, which would replace it with a reimbursement system based on quality care, as determined by the satisfaction of residents and their families, and by efficiency.

Fischbach agrees with this type of proposal, which eliminates the county designations that she considers senseless, saying that even though rural areas have a lower cost of living, the current nursing shortage means that nursing homes have fewer good employees to attract. Facilities receiving more funding due to a different designation find it easier to interest potential employees, according to Fischbach.

Though local legislators see a need for more nursing home funding, with the current deficit, no one knows where the money will come from or exactly how it will be spent. These proposals and others will continue to proceed through committee discussions and hearings, and if they are passed in one house they will be included in the budget bill for that house. A joint committee will then be created to compromise between the budget bill from each house and the final bill, if approved, will be passed by each house and signed by the governor.

(Editor's Note: Andrie is a 2004 graduate of Paynesville Area High School and a freshman at the University of St. Thomas in St. Paul. She is covering the 2005 legislative session for the Paynesville Press.)

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