In December 2012, courts gave California the go-ahead to implement Assembly Bill (AB) 97, a new law that will slash Medi-Cal reimbursements to hospital-based, distinct part skilled nursing facilities such as the Jewish Home. Under AB 97, the Jewish Home, which relies on Medi-Cal to care for 96 percent of its frail residents, will see its reimbursement rates reduced by approximately 30 percent, resulting in an approximate $12 million incremental cash deficit to the Home. But AB 97 will not just reduce future income; the cuts are retroactive to June 1, 2011, requiring the Home to repay approximately $19 million to Medi-Cal as of June 2013.
The Jewish Home of San Francisco is a historic, nonprofit facility – rated five stars for excellence by the U.S. Centers for Medicare & Medicaid Services – that counts on and receives generous community philanthropy to carry out its 142-year mission. However, the Home and its supporting community do not have the wherewithal to bridge the enormous funding gap AB 97 will create. Anticipating the profound financial impacts of AB 97, the Home has already implemented significant staffing and program changes.
Even before AB 97, though, the Jewish Home recognized the need for change and launched significant efforts to diversify its revenue stream and advance a plan for the future that reflects healthcare reform. The Jewish Home has broadened its short-stay rehabilitation program (STARS), expanded admission to its acute geriatric psychiatry program (one of the only programs of its kind in the Bay Area), and has a strategy to address the changing needs of older adults by delivering a continuum of age-in-place services and programs, including community-based services and new independent and assisted living apartments. This plan would be good for residents, good for the community, and good for California as it could save the state millions of dollars. But because of the impacts of AB 97, these plans have now been put on hold.
The Jewish Home is not the only institution affected by AB 97. Impacts will be felt across the entire distinct part nursing home industry, including Laguna Honda Hospital in San Francisco.
Since AB 97 was introduced, the Jewish Home has spoken out about its devastating impacts, both independently and by playing a lead role in a variety of coalitions – industry-focused, faith-based, in the city and county of San Francisco, with urban and rural partners. The Home has been an active voice in the California Hospital Association’s efforts to fight AB 97 and continues to support CHA in navigating the appropriate legal channels, including en banc proceedings and a possible U.S. Supreme Court case.
The Jewish Home is also advancing its own advocacy efforts, including a letter-writing campaign addressed to key California decision makers that engages the broader community in speaking out for the Home. To download an electronic version of the Home’s action letter, or to learn more about AB 97 and the Jewish Home’s intensive efforts to secure relief, visit its website dedicated to this important issue. Click here to visit the website.