After a year marked by repeated federal violations, the Vermont Veterans’ Home in Bennington must climb out of a steep deficit millions of dollars high.
In September, the country’s second oldest veterans’ home narrowly avoided losing its authority to administer Medicaid and Medicare benefits, which account for more than half of the home’s total revenues. With certification in hand — albeit under the intense scrutiny of the Centers for Medicaid and Medicare Services — the home must now try to reel in projected deficits in the current fiscal year and in FY 2014.
Vermont Veterans’ Home Administrator Melissa Jackson told the House Appropriations Committee on Tuesday that the home faces a budget deficit of $2.5 million in FY 2014. That is the figure before the appropriation of roughly $400,000 in Medicaid dollars, which relies on the state’s Global Commitment (or 1115) waiver that is up for renewal at the end of 2013.
The $2.5 million projected deficit is based on Gov. Peter Shumlin’s proposed FY 2014 budget for the home of $20.2 million. The governor’s proposal represents a 5.5 percent increase over the home’s FY 2013 allocation of $19.1 million.
After the home’s leadership team finished its testimony, Steve McClafferty, the home’s finance director, told VTDigger that he was projecting a roughly $3 million deficit for FY 2013.
“Our back is up against the wall,” Jackson told the committee.
What’s causing the deficit?
While the Vermont Veterans’ Home is fit to house 165 veterans and their spouses, there are currently 120 residents living on the premises.
This low census is one of the chief factors contributing to the home’s deficit, agreed the home’s administration, the Vermont State Employees Association, and Vermont Commissioner of Finance Jim Reardon.
The home has a high level of fixed costs, Reardon said. If the facility were to fill more beds, the fixed costs would stay level while revenues would increase, reducing the deficit, he said. Reardon met with Jackson and the home’s leadership team Tuesday afternoon.
According to Jackson, one of the main reasons the home’s population is so low is due to the lengthy processing period for Vermont and New York Medicaid applications.
“Even if the application is completed 100 percent on day one, it will take over three months for a Vermont Medicaid application to be approved and over four months for a New York Medicaid application,” according to a statement Jackson submitted to the committee.
Jackson elaborated on the home’s current situation regarding Medicaid approval from the Vermont Department for Children and Families.
“As of the other day, they were only working on August and we are now in January,” said Jackson. “She had 25 applications before she could even get to ours. And there’s always a risk when you take a Medicaid pending veteran. There’s a possibility they might not get their Medicaid approved for the date that you need. So, at this point in time, unless we know there are very few risks, we are not taking Medicaid pending individuals.”
Democratic Rep. Martha Heath, who chairs the House Appropriations Committee, was outraged that the Department for Children and Families was taking so long to process applications.
“It sounds like we need to have a conversation with Commissioner David Yacavone. That’s just not acceptable,” she said. “There is clearly a problem in the eligibility unit of DCF.”
Doug Racine, secretary of the Agency of Human Services, oversees the Department for Children and Families. He said after the meeting that he was not aware of this particular problem, but would look into it.
Raising revenue
By the start of FY 2014, in July, Jackson plans to increase the home’s population to 140 residents.
VSEA lobbyist Cassandra Magliozzi said the state employee’s union wants to work with the Veterans’ Home to not only increase the number of veterans at the home, but also the level of staff. Numerous veterans’ home employees told VTDigger this past autumn that the facility needs more staff.
“VSEA’s staff shares the administration’s goal to raise the census at the facility,” Magliozzi said. “But we do think there needs to be an increase in the number of full-time staff down there.”
Reardon, too, asserted that the facility should have appropriate staffing levels.
While the home needs to increase its population, Jackson told the committee, it must move prudently.
“We have to increase our census in a very thoughtful systematic process, to make sure we’re taking patients we can definitely care for (and) the staffing level is right where it needs to be, otherwise we’re going to have regulatory issues, and we can’t go down that path.”
Another revenue issue for the home is that some veterans don’t have coverage or are not paying the home for its services.
“I love my veterans to death; my husband is a veteran,” said Jackson. “But there is a sense that, ‘I am a veteran. I live in a veterans’ home. I get everything for free.’”
Reardon said the home needs to do a better job of screening residents who won’t pay for services.
Joe Krawczyk Jr., who chairs the Veterans’ Home board and previously served as a state representative, told the committee he would not shy away from removing veterans who don’t pay for the home’s services.
“I’m not afraid of publicity, and if I have to put a veteran out, I’ll stand up and take the heat for it because other veterans are suffering for this one person,” he said. “We’re going to do the right thing down there.”
