As RI Nursing Homes Face Millions in Fines by State, Locally-Owned Facilities Offer New Solution

As RI Nursing Homes Face Millions in Fines by State, Locally-Owned Facilities Offer New Solution

Rhode Island nursing homes are facing millions of dollars in penalties as the state prepares to enforce new minimum staffing requirements. 

Now, as nursing home advocates say that the financial impact could potentially close facilities, some industry leaders are calling for a different approach. 

GoLocalProv spoke with small, locally-owned facilities this week, that are concerned about their financial viability. 

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The law passed in Rhode Island in 2021 requires nursing home facilities to provide a specific amount of care per resident — or pay a fine. 

Initially, that metric started at 3.58 hours of direct nursing care and 2.44 of direct CNA care. It increased in January 2022 to 3.81 hours of nursing care and 2.60 hours of CNA care, but penalties were waved for the first two quarters of 2022.

“The penalties are the big issue in the industry,” said Jim Nyberg with LeadingAge Rhode Island, an organization of nonprofit providers of aging services, on a Zoom call this week with providers and GoLocalProv. 

“The Health Department a few weeks ago sent out letters on what the fines [for the first two quarters that were waived] would have been — and 55 out of 77 [facilties] would have faced penalties totaling $11 million,” said Nyberg. “The size and scope were more than anyone would have anticipated.”

With penalty letters from the enforceable period from July to September of 2022 expected shortly, Nyberg says the impact on the industry could be severe. 

“It will be devastating, with nursing homes closing,” said Nyberg. 

“One of our biggest struggles is there is no staff to hire,” said Constance Jaquith with Scandanavian Communities Nursing Home. “We’re utilizing agency personnel. If you have callouts, and you reach out, it doesn’t mean they’ll send someone over. The costs are exorbitant. It’s not sustainable.”

“Even the nursing homes that aren’t subject to penalties are barely doing so or losing money to be in compliance,” said Nyberg. “It’s not like they’re free and clear.”

According to the Rhode Island Department of Health — any penalties collected by the new law go to the state’s general revenue fund. 

 

A Different Approach

Nyberg and others in the industry are calling on the state to take a less punitive approach — one that is utilized in Massachusetts.

A clawback.

“It is premised on continuing a rate add-on to the nursing home Medicaid rate to support staffing,” Nyberg explained. “So if there was a 2% add-on in 2024 (in addition to the annual inflation index, like a COLA), the dollar amount of those funds could be returned to the state if the facility does not meet the ratio.”

“It is sort of how it works in Massachusetts.  Not ideal, but better than the penalties,” said Nyberg, who said there have been internal discussions regarding the proposal and some initial outreach to legislators on the concept.

In the meantime, nursing homes are pressing for penalties to be pushed off as they work with elected officials to address the issues.

“There are a lot of moving parts, and so we are hoping to do so in the near future,” said Nyberg of suggesting the clawback approach. “Our primary focus quite honestly is on delaying the fines, so outreach and education has been focused on that to raise awareness about the need for a delay.”

Governor Dan McKee’s office, when reached for comment, sent the following statement. 

“The Governor’s team is actively working with the General Assembly and other stakeholders to assess Rhode Island’s existing minimum staffing requirements and evaluate solutions that support residents, workers, and the long-term health of facilities.”