Health Care

Elder care industry confronts both a labor shortage and a financial crisis

Sue Chase is the executive director at CarePartners Adult Day Center in St. Albans. A labor shortage is hitting the elder care industry hard and causing major financial distress, compounding longstanding concerns about the sustainability of the industry. Photo by Riley Robinson/VTDigger

In Rookie Olson’s nine years in the business, he’s never seen anything like it. 

Vernon Hall, the assisted living facility in Vernon where he’s the administrator and manager, can’t seem to hire or retain anyone. 

After advertising for a nurse for more than a year, he finally managed to hire someone this week, but he’s still desperately searching for two resident assistants to help the 16 he has on staff. 

Hiring is only the start of the battle. What few staff members Olson managed to bring on in the last couple of months have left within a matter of weeks.

“I hire, they leave, I hire, they leave. I hire, they leave,” he said. “It’s like a revolving door.”

Long-term care facilities like Vernon Hall, along with health agencies and adult day care centers across the state, are struggling to hire and retain nurses, licensed nursing assistants and caregivers in the midst of a statewide labor shortage.

The Covid-19 pandemic sent costs mounting and revenue plummeting in the senior care industry, and the continued shortage in a sector that has long struggled to attract and retain staff is causing widespread financial distress and triggering closings across the state.

Meanwhile, Vermont’s population is aging, which means demand for their services continues to rise. Some facilities are turning away Vermonters who need high-level care because they don’t have the staff to provide it.

Staffing shortages

Long-term care facilities don’t have the luxury of closing or cutting corners on care, Olson said, and Vernon Hall’s remaining staff members are scrambling to keep up and care for the 41 residents. 

“We’re short-staffed, but you can’t not have somebody there,” he said. The residents “still need the care that we provide on a daily basis and don’t have the people there to do it.”

Covid safety measures, which remain in place at most long-term care facilities, also increase the workload. With more tasks and fewer hands, many facilities have relied on health agencies to provide staff to fill in shifts on six-month to two-year contracts. 

Thompson House Rehabilitation and Nursing Center and Thompson House Residential Home — separately licensed but affiliated facilities — have four positions open out of a combined 75 total direct caregiving staff. They have been running job advertisements for four months now, with little success, according to Dane Rank, the nursing center administrator and residential home manager. 

He relies on agency caregivers to fill in open shifts, despite the disadvantages. Agency caregivers often cost more than double what in-house staff would cost, change out regularly, need to be retrained often and do not develop the relationships with residents that he says are critical to providing care. 

But the health agencies themselves are struggling under the increased demand, and have their own labor shortage. Ten of the 26 jobs at Loving Home Care in Colchester are vacant, including a nursing position that has been open for over seven months, according to owner Abijah Francis Manga.

With its workforce reduced by a third, Loving Care is struggling to keep up with the increasing demand from its contracted facilities. Manga has repeatedly had to turn down requested shifts, which he worries is eroding the trust and reputation he’s built over five years in the business. 

Facilities have recently started asking him for shifts less often, and he has already lost one of his seven contracts because of unreliability, a reputation he fears will haunt him even after he is able to operate at full capacity.

Health agencies like Loving Home Care also send caregivers to individual homes and are also struggling to keep up with demand in that sector.

Jill Mazza Olson, executive director of VNAs of Vermont, an association of non-profit home health and hospice agencies, says staffing shortages coupled with increased demand have caused delays and left people waiting for care.

Adult day centers strapped, too

Karen Underwood, a nursing assistant at CarePartners Adult Day Center in St Albans, suits up to disinfect the dining room. She said one of the most rewarding parts of her job is seeing how her coworkers support each other. “The way we pull together when we are short, we’ve always done that,” she said. Photo by Riley Robinson/VTDigger

Many people unable to get help at home are turning to adult day centers as an alternative, only to find that they, too, are not an option.

After the state began lifting restrictions on adult day care centers this spring, many have been forced to delay reopening or operate at reduced capacity because of staffing issues, according to Linda Wichlac, president of the Vermont Association of Adult Day Services. 

It took Sue Chase, the executive director of CarePartners Adult Day Center in St. Albans, eight weeks to hire the three people she needed to reach 30% of capacity, positions she said would have filled up quickly before the pandemic. The center still has two open positions out of 10 total employees, and no applicants.

CarePartners started compiling a waiting list in September 2019, when referrals exceeded its capacity. Now, the list is more than 20 people for a facility that can currently take care of only 15 at a time. Before the pandemic, Chase said, it averaged 32 to 42 participants per day.

Chase now has to reject referrals who require nursing-home-level care and might need one or two people to assist them throughout the day because she simply doesn’t have the staff.  

CarePartners needs to fully reopen to offset considerable financial losses, but with the staffing problem, there is no guarantee it will be able to, Chase says.

45 open shifts

Long-term care facilities are facing similar struggles, according to Maria Rainville, long-term care facilitator at Cathedral Square in South Burlington. The assisted living facility had 20 open shifts over the last two weeks and the memory care unit 25. 

With fewer staff, its assisted living facility cannot safely take on residents with higher care needs. 

From left, Tsering Chodon, Kim Palasits, Sarah Juckett, Tsering Dolker and Karen Mayo, all staff at Cathedral Square in Burlington, hold a meeting between the day and night shifts July 12, 2021. Photo by Riley Robinson/VTDigger

Currently, 29 of the 30 residents at the assisted living facility need nursing-home-level care, and 10 beds remain open even as Cathedral Square turns away more high-level-care referrals.

The reduced occupancy is hitting nursing homes the hardest. Though many facilities made it through the pandemic with few or no Covid cases, news about outbreaks at nursing homes across the country have made many people reluctant to move loved ones into nursing homes, according to Rank. 

Each empty bed represents sunken costs in a time of great financial difficulty for the industry.

“We desperately need people to come back, because if they don’t, we’re not gonna make it,” Rookie Olson said.

Low wages, burnout and no new nurses

Administrators attribute the staff shortage to low wages, emergency unemployment benefits, rising costs of living, the difficulties of working in the industry during the pandemic, and a lack of educational opportunities for nurses.

Wages in the care industry are low — nursing assistants make a median wage of $15.62 per hour, according to the Vermont Department of Labor — and many facilities say they can’t afford to pay the higher wages that could attract and retain the staff they need. 

Right now, caregivers can often make more money off unemployment than on payroll, according to Rookie Olson.

Multiple facilities reported that job applicants often blow off scheduled interviews, or never respond to job offers. Managers attribute that to the requirement that people receiving unemployment actively look for a job.

But it goes much deeper than the emergency unemployment benefits, says Anne Levesque, human resources and organization development director of Wake Robin Life Plan Retirement Community in Shelburne. 

Rising costs for child care, transportation and housing, exacerbated by the pandemic, mean many cannot afford to work in the industry, especially at more rural facilities beyond the reach of consistent public transportation, Levesque said.

Rising costs of education has also meant fewer new nurses in recent years, and aging caregivers have their own health concerns that put them at greater risk during the pandemic. 

Three older caregivers left Thompson House at the start of the pandemic out of fear for their own health, according to Rank. 

For those who stayed, the work was grueling. Staff shortages and the increased workload meant staff consistently had to work overtime. Rainville said some employees at Cathedral Square continue to work 60-hour weeks, and burnout is common throughout the industry.

Tsering Chodon, a licensed professional nurse, has worked at Cathedral Square for about seven years, where she supervises a team of resident assistants. Photo by Riley Robinson/VTDigger

Many people don’t want to work in the care industry after seeing what it went through in the last year and a half, according to Laura Pelosi, head of policy and regulatory affairs for Vermont Health Care Association, and it had already been difficult to attract people to the field. 

“It takes a special person to work in this field,” Chase said. “You’ve got to have incredible patience and flexibility and it can be incredibly rewarding but also equally heartbreaking.”

But many of these troubles started well before the pandemic. 

Lack of incentives for people in nursing-related professions to move to Vermont and limited training opportunities in the state mean there are few new caregivers to replace those who retire or leave, Pelosi said.

Staffing issues forced Derby Green Nursing Home in Derby to close permanently in the beginning of 2020, before the pandemic, and many other facilities have been struggling for years, Pelosi said.

‘Thin margins have been blown’

Since the start of the pandemic, three adult day centers and nine residential care homes have closed in Vermont, primarily due to the financial burden of staffing,  according to Monica White, commissioner of the Department of Disabilities, Aging and Independent Living.

“The largest controllable cost is staff, and having that increase at the same time that our revenues through reduced admissions has decreased, means that our already thin margins have been blown,” Rank said. 

But financial difficulties are not new to the industry, which relies heavily on funding from Medicaid and Medicare. 

Administrators say the Medicaid reimbursement rate has long been far too low and does not nearly meet the actual cost of care.  The adult day center reimbursement rate is $17.20 per hour, but Chase says that each participant costs CarePartners $20 per hour in operating expenses. With 75% of her participants on Medicaid, it’s a significant gap.

Medicaid reimburses Thompson House at a rate of $246 a day per resident in the nursing facility, $15 less than it costs the facility to care for them.

Statewide, more than two-thirds of nursing home residents pay for their stay with Medicaid and another 15% with Medicare, and the gap between reimbursement and costs in Vermont nursing homes alone was about $14 million in 2018, the last time the Vermont Health Care Association did those calculations, according to Pelosi. 

The reimbursement rates for nursing homes are based on costs that are two to four years out of date, and the current rates are based on nursing cost estimates from 2019, before the pandemic sent costs skyrocketing.

“I can’t imagine that there are many places that can survive at the current rate of reimbursement,” Rank said.

Rescue money

Administrators say state and federal funding kept their doors open through the pandemic as costs soared, including Paycheck Protection Program loans, Coronavirus Relief Fund dollars and now funding from the American Rescue Plan Act.

Chase estimates that revenue is meeting only slightly more than 50% of the operating costs of CarePartners, and with further reopening still impossible due to staff shortages, it’s relying on the incoming American Rescue Plan dollars to stay financially solvent.  

“Without the [coronavirus] relief money and now the American Rescue Plan money that was allocated to us by the Legislature directly, we were in danger of collapsing,” Wichlac said. “The whole entire [adult day care] industry was in danger of collapsing.”

Thompson House in Brattleboro, like many elder care facilities, has been forced to raise rates. File photo by Kevin O’Connor/VTDigger

Even with relief funding, rising staffing costs and low reimbursement rates are forcing facilities to raise costs for residents. 

The mission of Thompson House is to provide affordable care, but with the residential home at half-capacity and with the cost of hiring agency staff, it has still had to raise room rates to remain financially solvent, according to Rank. 

Thompson House Rehabilitation and Nursing Center already raised room rates by $10 a day, and Rank anticipates they will have to go up in the residential home as well in the coming months.

The costs, Rank said, “are going to eventually be reflected statewide for nursing homes because I can’t imagine that there are many places that can survive at the current rate of reimbursement.”

An uncertain future

Facilities are doing everything they can to hire and retain staff.

Wake Robin recently raised its wage floor to $15 an hour and gave staff a $2 raise per hour, pushing back building plans and reevaluating programs to be able to afford to do so. A week after making the change, it’s seen an influx of applications, Levesque said.

“Our staff makes us as good as we are, and that staff needs to be valued,” she said. “It’s just the right thing to do, so we found the money.”

Thompson House also raised wages, created a sign-on bonus, and added workplace amenities, such as massage chairs in the break room and free lunch in the dining hall.

“We’re just trying to do as many employee benefits as we possibly can,” Rank said. “I’m buying doughnuts like a crazy person.”

But individual facilities say they cannot fix a systemic issue on their own, and many have looked to the Legislature for help.

The Vermont Legislature recently passed measures to increase scholarships for nursing programs, ease the clinical teaching qualifications for nurses, create a pathway for former military medics to  practice, invest in partnerships among facilities and educational institutes, and join an interstate nursing compact to allow nurses from other states to practice in Vermont. 

The Vermont Board of Nursing also moved to allow facilities to sponsor international nurses in Vermont, according to Pelosi. Rank is now pursuing contracts with agencies in Puerto Rico and the Philippines in the hopes that, if he can’t get the staff he needs in Vermont, he can find them elsewhere. 

“At the end of the day, it’s a bodies problem; we don’t have the number of people we need,” Pelosi said. “We need to attract a lot more in the way of nursing-related professions, and we need to be able to grow more of our own here in the state of Vermont.”

White anticipates that these problems will become more acute in Vermont’s aging population. By 2030, nearly 30% of Vermonters will be over age 65, according to the Department of Disabilities, Aging and Independent Living annual report.

As life expectancy increases, the state will need to be able to take care of “older, more frail and more medically complex patients,” Pelosi said. But if facilities continue to close or struggle with staffing issues, there will be no one to do so.

“The need for assisted living and senior care is astronomical,” Rainville said. “Our services are needed, but we just don’t have the staff.”

Correction: Laura Pelosi is a lobbyist for Vermont Health Care Association. An earlier version of this story misidentified her title.

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