Lawmakers will be looking at any number of pots of money in the next two months in an effort to close a $4.6 billion state budget gap. Unfortunately in such times, some of the first pots to be drained a=supply funding to prevention or intervention programs.
The cost to provide care to our elderly is expensive -- reimbursements to nursing homes and waivered services to keep our elderly in their homes is a substantial part of the state budget. Gov. Tim Pawlenty's proposed budget would greatly affect the ability of long-term care facilities to deliver services through failure to equalize the formula used to base state reimbursements -- a formula which is set to 2002 costs. Also, the governor would end temporary 1 percent increase in the rates as allowed by the 2008 Legislature.
Because of lower reimbursements, facilities that heavily depend upon government subsidizes as a majority of their residents are on public assistance, just can't make it. Many in northern Minnesota cross the line, and fold, leaving their communities without a local facility to care for their elderly. There have been 53 nursing home closings since 2000.
The Long-Term Care Imperative, a consortium of long-term industry interests, will point out that the long-term care sector plays a vital role in the state's economy, supplying more then 142,000 jobs. The total economic impact of long-term care facilities in Minnesota is more than $9.8 billion annually, something that rivals tourism's $10 billion annual impact.
In the governor's proposed budget, health and human services spending would account for 33.7 percent of state general fund spending, second only to K-12 spending at 38 percent of general funding spending. And a large share of health and human services spending goes to long-term care. As such a large portion of the budget, it only makes sense that some of the state budget gap be filled with cuts there.
That is to be expected, as long as the cuts are fair and part of an overall picture that doesn't shortchange important services.
We would argue that, as the age of Minnesotans increases and as baby boomers retire, the provision of long-term care services will become instrumental. That's why it's important to lay the groundwork now, and not take an opportunity to build capacity and preventive care, such as services which keep older people in their homes and out of more costly nursing homes.
Personal responsibility is important, too, if incentives can be offered to make it beneficial for people to seek long-term care insurance.
Equitable reimbursement rates and provision for capital investment for new and upgraded facilities is a must in order to prepare for the baby boomers.
We hope that decision makers this year have the foresight to plan for the future as well as seeking a short-term budget-balancing solution.