AUGUSTA, Maine — Maine has not set aside enough money to meet an obligation to boost pay for workers at struggling nursing homes, spurring worry that the funding may not make it into a spending bill before lawmakers leave Augusta for the year.
Lawmakers approved raising the pay for direct care workers at nursing and residential facilities to at least 125 percent of the state minimum wage last summer after years of the industry decrying low Medicaid reimbursement rates that make it difficult to maintain workers. Gov. Janet Mills began releasing that money in January ahead of a planned July rate bump.
The Democratic governor’s $1.2 billion spending proposal now being considered by the Legislature includes an additional one-time $7.6 million infusion to help with labor costs and $25 million more in state and federal funds to offset pandemic costs. That funding for nursing homes, including a cost of living adjustment, is also expected to kick in by July.
This budget includes money to increase reimbursement rates for other providers to 125 percent. But it does not include nursing home workers while the state completes a rate review. That could be problematic for an industry struggling to attract workers while caring for vulnerable residents. With less than two weeks before the Legislature is supposed to adjourn, nursing home interests argue the state needs to act quickly to make sure the workforce remains stable.
“[The money] does not fill the gap to keep the workforce we need to keep facilities open,” said Angela Westhoff, CEO of the Maine Health Care Association, a nursing home industry group.
Five nursing homes have closed since 2021 in Maine, with many citing long-term staffing issues, declining occupancy, lack of affordable housing for workers and a state vaccine mandate last year that had little overall effect on health care employment but hit nursing homes harder than many other settings. Maine nearly lost two veterans homes in Caribou and Machias before lawmakers rushed through a bailout bill.
While closures have eased over the last several months, the industry is still reeling. A recent Maine Health Care Association survey of 200 members found over 40 percent of facilities considered staffing to be at crisis levels, despite 55 percent providing bonuses and more compensation. Three-fourths of facilities said they increased reliance on contract workers.
The state is working on calculating how much money it would need to ensure workers are meeting that threshold, said Jackie Farwell, a spokesperson for the Department of Health and Human Services. But It was not clear if that work would finish in time to add it into this budget. She pointed to several other instances where Maine has aided the industry in the pandemic.
“The Department is committed to fully funding these rates,” she said.
Sen. Joe Baldacci, D-Bangor, who sits on the Legislature’s health committee, said a delay in increasing reimbursement rates could lead to further closures. Rep. Sawin Millett of Waterford, a top Republican on the budget committee, said the topic is likely to come up next week as his committee panel reviews past funding for the industry.
“They are definitely a point of concern,” Millett said.
But more money alone cannot address all the problems nursing homes are facing, said Jabbar Fazeli, who leads the Maine Medical Directors Association and administers a handful of southern Maine nursing homes. He noted homes were offering large sign-on bonuses and increasing pay but still struggling to find workers.
Varying payment rates for Medicare plans offered by contracted private companies have also hit facilities’ bottom lines. One potential solution is allowing overseas workers into the country quicker to give nursing homes more applicants to pull from, he said.
“People are doing whatever it takes to attract the staff,” he said. “There just isn’t enough staff, unfortunately.”