Staff Shortage Gets Worse

Acute shortages of home care workers are occurring all over the country, threatening care for people with disabilities and older adults. Many agencies are struggling with retention and scheduling as a smaller pool of workers are increasingly moved around to cover open positions.

In Minnesota and Wisconsin, nursing homes have denied admission to thousands of patients over the past year because they lack essential staff, according to local long-term care associations. In New York, patients living in rural areas have been injured, soiled themselves, and gone without meals because paid caregivers aren’t available, according to testimony provided to the state Assembly’s health committee in February. In Illinois, the independence of people with severe developmental disabilities is being compromised, as agencies experience staff shortages of up to 30 percent, according to a court monitor overseeing a federal consent decree.

The emerging crisis is driven by low wages, mostly funded by state Medicaid programs, and a shrinking pool of workers willing to perform physically and emotionally demanding work. It portends even worse difficulties to come. America’s senior citizen population will swell to 88 million people in 2050, up from 48 million currently, and requires more assistance with chronic health conditions and disabilities, experts warn.

“If we don’t turn this around, things are only going to get worse,” said Dr. David Gifford, Senior Vice President of quality and regulatory affairs for the American Health Care Association, which represents nursing homes across the U.S.

Rising Demand, Stagnant Wages

For years, experts have predicted that demand for services from a rapidly aging population will outstrip the capacity of the direct care workforce.

The U.S. Bureau of Labor Statistics estimates an additional 1.1 million workers of this kind will be needed by 2024 — a 26 percent increase over 2014. Yet, the population of potential workers who tend to fill these jobs, overwhelmingly women ages 25 to 64, will increase at a much slower rate. Falling immigration and refugee rates may make the situation worse.

After the recession of 2008-’09, positions in Medicaid-funded agencies were relatively easy to fill. Now, however, the improving economy has led these workers to pursue other higher-paying alternatives. Turnover rates have soared.

At the same time, wages for nursing assistants, home health aides, and personal care aides have stagnated, making recruitment difficult. The average hourly rate nationally is $10.11 — a few cents lower than a decade ago, according to PHI, an organization that studies the direct-care workforce. There is a push on now in a handful of states to raise the minimum to $15 an hour.

Hardest to cover are people with disabilities or older adults who live at some distance from a city center and need only one to two hours of help a day. Workers prefer longer shifts and less time traveling between clients, so they gravitate to other opportunities.

Hard Times in Wisconsin

Some of the best data available comes from Wisconsin, where long-term care facilities and agencies serving seniors and people with disabilities have surveyed their members over the past year.

One of seven caregiving positions in Wisconsin nursing homes and group homes remain unfilled, one survey discovered; 70 percent of administrators reported a lack of qualified job applicants. As a result, 18 percent of long-term facilities in Wisconsin have had to limit resident admissions, declining care for more than 5,300 vulnerable residents.

“The words ‘unprecedented’ and ‘desperate’ come to mind,” said John Sauer, president and chief executive of LeadingAge Wisconsin, which represents not-for-profit long-term care institutions. “In my 28 years in the business, this is the most challenging workforce situation I’ve seen.”

Sauer and others blame inadequate payments from Medicaid — which funds about two-thirds of nursing homes’ business — for the bind. In rural areas, especially, operators are at the breaking point.

“We are very seriously considering closing our nursing facility so it doesn’t drive the whole corporation out of business,” said Greg Loeser, chief executive of Iola Living Assistance, which offers skilled nursing, assisted living, and independent living services in a rural area about 70 miles west of Green Bay.

Like other short-staffed operators, he’s had to ask employees to work overtime and use agency staff, increasing labor costs substantially. A nearby state veterans home, the largest in Wisconsin, pays higher wages, making it hard for him to find employees. Last year, Iola’s losses on Medicaid-funded residents skyrocketed to $631,000 — an “unsustainable amount,” Loeser said.

Wisconsin Gov. Scott Walker has proposed a 2 percent Medicaid increase for long-term care facilities and personal care agencies for each of the next two years, but that won’t be enough to make a substantial difference, Loeser and other experts say.

The situation is equally grim for Wisconsin agencies that send personal care workers into people’s homes. According to a separate survey in 2016, 85 percent of agencies said they didn’t have enough staff to cover all shifts, and 43 percent reported not filling shifts at least seven times a month.

These staff shortages are making it more important that agencies have the right workforce management tools to help with employee retention and manage the changing schedules of a shrinking workforce. To learn more about how workforce management can help your agencies minimize turnover and improve retention rates, contact MITC.

Does Your Company Have a System for Making Decisions?

In an interview with The Wall Street Journal, James Quincey, the new chief executive officer of Coca-Cola Co. said that he is hoping to “shake off a culture of cautiousness” within the company and encourage his team to “make mistakes”.

In a letter to investors, Amazon founder Jeff Bezos noted that in making decisions with his team, he commonly relies on one philosophy: “disagree and commit.” If there is no consensus among the leadership team, a decision is made — and Mr. Bezos asks that the leadership team makes their objections known and then commits to the plan. This allows the organization can move ahead without consensus – and allows everyone’s voices to be heard.

Both of these leadership philosophies revolve around the idea that failure is part of doing business. And that’s what led to the discussion in our office. For contractors, is failure part of doing business? In an increasingly competitive market, developing new services and diversifying revenue streams are part of a sustainability strategy. However, not every new strategy is going to work — and that means that failure is an inevitable part of market-driven strategy.

Here are some rules of thumb for executive teams to follow.

  • Don’t allow your team to be paralyzed by decision making. Launching a new service line, agreeing to a value-based contract, investing in new technology, initiating a new merger or acquisition, creating a partnership — these are big decisions that require decisive action. Decide yes or decide no — but do the analysis and make a decision. It is the responsibility of a leader to move their organization forward and to assure the organization and its team are positioned and prepared. As Mr. Bezos notes in his advice, that doesn’t mean everyone has to agree with every aspect of every decision you make, but it does mean you need to actually make a decision.
  • Once you’ve made your decision, your team needs to find a way to help your internal stakeholders — from the board room to the front line — embrace the new direction. Committing to a new strategy or focus requires your management team to master the art of managing change. This includes communicating with your team about why the changes are being implemented, building a culture that incentivizes and embraces change, and developing the talent and competencies needed to manage change.
  • Your team needs competencies for metrics-based management and management process excellence to develop and operationalize new strategies effectively. For contractors, where payroll is the largest single cost and consistent service delivery vital, an effective workforce management solution is essential. Effective workforce management provides the metrics to understand the costs and risks involved and the tools to manage new projects.
  • Your team needs the right workforce management technology to manage change. Unless managers have real time information on time and attendance, schedules, orders, inspections, and other critical metrics in good time, problems will be reported late or worse, remain unknown.

Some organizations fail to act in the face of new challenges or opportunities. Looking ahead, the writing is on the wall that their market position is eroding and cash reserves are dwindling. They fail to make final decisions about their plan or if they have a plan, it isn’t implemented in a timely, effective manner. Why does this happen?

The “why” question is where it gets complicated, but often it is because the contractor doesn’t have the workforce management tools to accurately analyze what is going on now and to manage new projects easily.

  1. The chief executive officer doesn’t have the right information on environmental analysis, financial feasibility analysis, or planning tools to make market-oriented strategy decisions.
  2. The degree of downside risk, and return-on-investment is not understood. Doing nothing can be more risky than embracing change.
  3. The organization is risk adverse because of past failures and will not approve a proposal with downside risk.
  4. The management team lacks the transactional tools — metrics-based performance analysis, real time project management control, and service reporting, to go from idea to service.

Richard Edley Reflects On What Managed Care Means for Pennsylvania Providers

Managed Care is coming to Pennsylvania, like it or not. Many agencies in Pennsylvania will shortly be required to interact with Managed Care organizations for the first time. Providers are going to need to get authorized, acquire new technology, introduce new systems and work with new organizations. This is uncharted water for many providers. Richard Edley, President and CEO of RCPA, has been working with the state, MCOs, and agencies regarding the expansion of Managed Care in Pennsylvania. Since 1994, Richard has been working to support health care in Pennsylvania.

When asked what challenges he foresees when adapting to Managed Care, Richard notes that Managed Care isn’t actually new to Pennsylvania. “Behavioral and physical health care providers have had Managed Care for a long time. It is the move toward Managed Long Term Services and Support (LTSS) that is a new initiative. You’re now talking about social services, rather than medical services. The expansion of Managed Care does not apply to the Intellectual/Developmental Disabilities agencies, even though there has been a lot of talk over the years. It’s bound to come back.”

“However, while Managed Care isn’t new to Pennsylvania, there are new challenges presented by Managed Care for LTSS. Physical health has its challenges, but it is much more standardized. If a patient has symptoms that meet a certain criteria, and the treatment suggested is criteria based, the process of submitting for approval is fairly straightforward. With long term care, you’re talking about such things as in-home services, supports for people to get employment, or care for the elderly, so applying criteria and authorizing services is a grey area. It is much harder to manage.”

“Managed Care Organizations (MCOs) have to learn about how the system works to focus on efficiency and services. It’s a very complex system, and MCOs will have a learning curve.”

“In the previous structure, clients would seek out agencies. The agencies would then get authorization through the state. Now, clients will seek out the MCOs or an agency. If the client contacts an MCO, the MCO will put the client in touch with an agency and work directly with the state. If the client contacts an agency, the agency will have to contact the MCO to get an authorization.”

“For many of the affected agencies, this is the first time they’ll be touching managed care in any way. This is the first time they are dealing with the notion of getting credentials/accreditations, submitting for authorization, tracking, submitting claims that match, need for appeal, or the need to submit for additional services. This is a whole new world.”

“From the IT standpoint, many providers are still very much paper and pencil. A few may have relied on a very basic system or the state system to help them. Now, these providers are going to need Electronic Visit Verification (EVV), electronic health records, and need to get the data to the MCOs in real-time. It will be stressful for small providers, and they’re going to face a real struggle.”

“The way it works right now for agencies without EVV, a person goes into the home and there is no way to verify the visit. If the provider sees a problem with the time, they have someone go back to the office, fill out some things in a system, submit a fax, and eventually authorization happens. If that’s the situation, you are losing valuable time. Technology can be given to attendants to verify the presence of the caregiver and submit requests online. It speeds everything up, saves money, and prevents delays in receiving necessary treatment. Agencies need to be better prepared to take on the technological burden.”

“There is an additional pressure on agency providers: this is the first time the state Community Health Choices has released a procurement where the MCOs are not required to have an Any Willing Provider Network. If a Pennsylvania service area starts with ten providers, after the six month transition period the MCO may only use two.”

“We have to ask providers, ‘How are you going to differentiate yourself?’ We’ve looked at raising the bar on credentials and standards as well as data outcomes. If agencies could track in real-time, it could help them survive the transition period. There is an uncertain future for providers. There is risk for personal attendant services and service coordination entities; some might not survive.”
“In terms of resources, no one is talking about funding as of yet. The state and MCOs are going to be hosting a lot of trainings and meetings, but providing resources for agencies to learn about managed care is also the role of the associations.”

“RCP-SO is being organized to represent the providers who are affected. In the mid-1990s, the precursor to RCPA founded Community Behavioral HealthCare Network of Pennsylvania, Inc. I worked there as CEO for many years before coming to RCPA. It was a provider owned company, and it proved that if you have managed care coming to a state, providers can come together and manage it themselves, rather than wait what MCOs are mandating.”

“With that background, it wasn’t out of left field for RCPA to meet with providers, or suggest building a company managing CHC. However, we aren’t competing against large physical health plans. Community HealthChoices has billions in expenditures; that wouldn’t be feasible. We are coming together to create specific products to improve quality and be more cost-effective proving viability in the long-term for MCOs.”

“We’re seeking to help providers in four fields: Brain Injury, Service Coordination, Personal Attendant Services, and Vocational and Day Programs.”

“All of the products, at a high level, streamline administration and work toward alternative reimbursement and unified quality indicators. As an example, with Brain Injury providers, we represent all the post-acute care providers in the state. They have their own outcomes measure and tools, and are all CARF accredited. It wasn’t hard to go to the MCOs and tell them we can manage Brain Injury services for them.”

“It would be more difficult for MCOs to manage Brain Injury providers on day one because they aren’t familiar with how they operate, and there are so many competing interests and priorities (e.g., nursing home admissions). MCOs are contracting with us to standardize quality outcomes, and define quality reimbursement services.”