South Dakota lawmakers pass big nursing home funding boost

Thursday, March 14, 2019

PIERRE, S.D. (AP) — South Dakota lawmakers on Wednesday approved millions of dollars of new funding for nursing homes experiencing a financial crisis that’s led to five closures over the last three years.

Advocates say the significant 10 percent inflationary funding increase for nursing homes included in the state budget is a step in the right direction. The Legislature passed the spending plan just days after a facility in Huron announced that it would shut down by May because of a lack of funding.

Mark B. Deak, executive director of the South Dakota Health Care Association, said the rate of closures has “accelerated dramatically” because of underfunding Medicaid reimbursements. But the new inflationary increase will hopefully prevent some potential nursing home closures, he said.

“When you see this happening around the state, I would say that’s a big crisis. It certainly is for the communities that it happens in,” Deak said. “I think it really comes down to will. Do we have the will to make caring for our elderly a priority for us?”

The Huron nursing home will be the sixth in the state to shut down in roughly three years, following closures in Madison, Mobridge, Tripp, Bryant and Rosholt, according to the association. South Dakota has about 100 nursing homes that care for a total of roughly 6,500 people, Deak said.

He credited lawmakers and Republican Gov. Kristi Noem for taking a “very good step,” but he said advocates plan to keep pushing for future increases. The current gap between the cost of caring for people and the rate of Medicaid funding is about $58 per recipient each day, a shortfall of about $66 million annually, Deak said. The South Dakota Association of Healthcare Organizations pegs the shortfall at about $42 million per year.

The new money will fill in roughly one-third of the disparity between state support for care and the cost of providing it to Medicaid recipients at Jenkins Living Center in Watertown, said President and CEO Loren Diekman. It’s the largest single boost Diekman said he can remember during his roughly three decades at the facility.

The funding will help the Jenkins facility purchase equipment and allow it to invest in staff to help draw and retain workers, Diekman said.

“This is truly a blessing in so many ways compared to what we’ve received in previous years,” he said.

Sen. John Wiik, co-chair of the Joint Committee on Appropriations, told his colleagues early Wednesday that he talked to every senator he could about priorities and that all of them said lawmakers needed to find a solution for nursing homes.

“Is that going to solve the problem entirely? No. But it’s a good start, and it’s a good step,” Wiik said of the inflationary hikes.

Lawmakers approved bigger funding increases than Noem originally suggested for health care providers in her January budget address.