LeadingAge and WHCA are working to identify the number of skilled nursing beds that are licensed but non- operational. This information is crucial so we can accurately determine access to SNF beds. It will also be used to message legislators during session to make sure there is a better understanding of bed capacity. 

Please take five minutes to complete this online survey. Your results will be used to help tally the total number of non-operational beds in Washington. Please respond by Friday, October 18th. 

BACKGROUND

Currently DSHS reviews SNF occupancy and available capacity by assessing the ratio of resident bed days to the total number of licensed beds:

• Resident bed days/number of licensed beds = occupancy percentage
• Number of licensed beds – occupancy percentage = available capacity

The number of licensed beds does not equal the number of beds that are set up and able to take residents, and therefore, occupancy percentages and available capacity are skewed.  In some cases, SNFs are holding licenses on beds that are not set up or in use. For example, some rooms that were originally licensed for four beds currently only have two beds set up and in service, but the other two licenses have not been relinquished (beds are not “banked” or de-licensed). In this situation, the physical bed itself does not exist (“ghost beds”). Another example is that a SNF may be licensed for more beds than it can staff to be in compliance with mandatory staffing requirements. In this situation, the bed may or may not exist, but even if it exists, it is inoperable. The first example is more of an ongoing example, whereas the second example is more likely to be time-limited (but sometimes over long periods of time).

The reasons for holding licenses on beds that do not exist or that are not in use are unknown, but may include:

• A count of bed licenses may have been used to secure financing or contracts.
• Holding extra licenses for potential future expansion (no need to go through a CON).
• Potential resale value.
• Temporarily unable to hire and retain sufficient staffing to meet mandatory requirements.
• Chronically unable to hire and retain sufficient staffing to meet mandatory requirements.

The scope of “ghost beds” is unknown, but is thought to be significant.

Problem Statement: 

Licenses on beds that do not exist or that are not operational are influencing the ability to secure Medicaid funding in the following ways:

• There appears to be an abundance of unused capacity in the SNF system. Many members of the Legislature are not concerned by facility closures and/or by low rates because reviews of capacity based on licensed beds shows plenty of beds available, even after the closures.  
• When assessing access, Navigant determined there was plenty of Medicaid access to SNFs at current substandard rates.
• Low occupancy percentages result in high occupancy penalties in indirect care rates.  This impacts the narrative on how far out of synch SNF costs are from SNF payments.  In fact, DSHS assessed that in 2018, $30 million worth of provider costs would have been considered allowable Medicaid expenditures, but were adjusted out of the expenditure analysis due to penalties on low occupancy percentages.  Penalties are not a Medicaid allowable cost.
• Consolidated Billing Services has suggested that unused beds/beds not set up that are still licensed are dampening the Medicaid payment rates for indirect care by as much as $7 ppd.
• It can be difficult to justify opposition to cost increases on bed licensing fees if providers have enough money to pay fees on beds that do not exist.

Please let me know if you have any questions. 

Alyssa Schnitzius- Director of Senior Living & Community Services 

p: 253.964.8870 |  c: 206.948.2279