By Tim Hanold
The COVID-19 pandemic has fundamentally changed our perception of health care and disrupted its delivery. While the focus should be on hospital capacity, too often home care services did not receive the critical attention they deserved. As hospitals reached capacity, home care agencies met demand as the most cost-effective and preferred care setting while continuing to meet long-term health care needs.
These same home care agencies are now on the brink of a serious problem.
As the 2022 General Assembly moves toward budget reconciliation, Virginia lawmakers will make an important decision on the future of home health care in the Commonwealth by deciding whether to increase reimbursement rates of Medicaid for home care at equitable and sustainable levels.
With a reimbursement rate of $14.39 per hour, Virginia currently ranks below neighboring states, such as Maryland and North Carolina, in Medicaid reimbursement for home care. The latest reimbursement increase of 12.5% in 2021 was unfortunately not enough to keep pace with the 26% increase in salaries for nursing aides in 2021. (The national average hourly wage for nursing aides was of $13.49 in 2020, according to the Bureau of Labor Statistics) Current rates are so low that home care agencies may struggle to pay caregivers, provide benefits, or obtain training that increases labor costs. skills and access to a career ladder that allows home care providers to progress from personal care worker to registered nurse.
However, this decision is not just about dollars and cents, it is a proclamation on sustainability and access to home care for the Medicaid population. In short, if Medicaid reimbursement rates are not increased enough, home care agencies will no longer be able to provide these services to Medicaid patients.
The math is simple, but the impact is not. Supporting a fair increase will keep tens of thousands of Virginians employed and provide access to needed home care services for the most vulnerable Virginians.
The data on this subject is convincing and clear.
Home care provision can be a 95-98% savings on a traditional hospital stay. Additionally, specialized home health care promotes cost avoidance by keeping care recipients out of emergency rooms and long-term nursing homes, creating two dollars in savings for every dollar invested in the House.
Patients also prefer to receive home health services, as it provides them with flexibility, dignity, and extended independence. Additionally, many home care recipients report higher levels of satisfaction with the provision of care at home than in other health care settings.
Consequently, the demand for home care is increasing rapidly. This is especially true given the population over 65 should grow from 56 million in 2020 to 73 million in 2030. This growth is an opportunity to create and sustain goal-oriented work for many, as the need for home aids and personal care is expected to increase much faster than the national average for all occupations. The decision not to support an increase in Medicaid reimbursement rates puts current and future jobs in Virginia at risk.
It will also lead to the loss of access to care for the Commonwealth’s most vulnerable population and increase the likelihood that they will fall through the cracks of an already fractured healthcare system or overwhelm existing care homes. An investment in home healthcare strengthens the safety net for the Commonwealth and provides a fiscally responsible pathway alongside clinically superior and socially responsible care.
If the General Assembly neglects the importance of increased funding for Medicaid reimbursement rates for home care, it will be financially unsustainable for home health care agencies to continue providing services to Medicaid beneficiaries. in Virginia. The result could cost Virginia jobs, access to needed care, and jeopardize the stability of our communities.
Tim Hanold is CEO of Care Advantage, Inc., one of Mid-Atlantic’s largest privately held home health care companies.