With over 2.4 million Pennsylvanians aged 65 and older, and one in three residents projected to be over 60 by 2030, LeadingAge PA, state leaders, and residents gathered in the Main Capitol Rotunda Tuesday to advocate for establishing a more consistent and sustainable Medicaid reimbursement system for nursing homes and LIFE (Living Independence for the Elderly) providers in the 2025–26 state budget.

The group emphasized that a $139 million investment for nursing homes and a $20-22 million investment for LIFE providers are crucial, as both are experiencing significant workforce shortages and other challenges.

“At a time when we should be expanding services, aging services providers are being forced to make difficult decisions, including limiting admissions, scaling back services, and even closing doors due to a persistent workforce shortage and an unpredictable funding system,” said LeadingAge PA President and CEO Garry Pezzano.

In the last few years, at least 30 nursing homes have closed in Pennsylvania, and thousands of additional beds have either been de-licensed or sit out of use due to staffing and funding challenges.

Around 70% of nursing home residents, as well as nearly all participants in the LIFE program, depend on Medicaid for their care.

“Pennsylvania is home to a significant older population that continues to grow, which means we must invest in the programs, resources, and caregivers who give our seniors the ability to age in their community that’s best suited to their needs. As we continue to negotiate this year’s budget, my colleagues in the House and I will continue to fight for these critical investments,” House Majority Leader Matt Bradford said in a written statement.

“I thank LeadingAge PA for advocating on behalf of our many senior housing, health care, and community services and their dedicated workforce, all of whom are vital to ensuring that our older Pennsylvanians maintain a good quality of life.”

Budget proposal

Nursing home provider members in Pennsylvania have reported that their reimbursements from Medicaid are only 45-60% of their actual costs of care.

To address this, LeadingAge PA seeks two key changes:

• A 0.90 floor for the Budget Adjustment Factor for nursing homes, requiring an investment of approximately $139 million.

• A minimum reimbursement rate of 63% of the Amount That Would Otherwise be Paid for LIFE providers, estimated at $20 to $22 million annually.

Despite funding increases in recent years, providers continue to face significant challenges, as highlighted in a survey conducted in part by LeadingAge PA.

• 53% of nursing homes reported having to limit admissions.

• 38% could not continue with planned facility improvements.

• 20% closed entire wings or units.

“With a rapidly growing senior population and a caregiver workforce shortage, it is absolutely critical that we adequately fund senior programs and services in the upcoming state budget,” said Rep. Maureen Madden, Chair of the House Aging & Older Adult Services Committee.

Supporting independence

Rep. Madden, a long-time advocate of the LIFE model, emphasized its value in helping seniors remain in their homes while receiving the support they need. She was joined in this support by Chair Steven Mentzer.

“The LIFE program uses a coordinated approach to providing quality care while efficiently utilizing Medicaid funding, yet LIFE rates in the Commonwealth have steadily declined over the last 15 years,” said Rep. Mentzer. “Without a more sustainable reimbursement structure, providers may no longer be able to operate, forcing participants to shift into more expensive care settings, raising costs for the state.”

Removing barriers

“Too many of our families, including mine, have faced the difficult decision of moving a beloved parent or grandparent into a long-term care center, yet the professionals who make sure they are cared for are facing increasing challenges because of workforce shortages,” said Sen. David Argall. “By encouraging more people to pursue this fulfilling career path, we’re ensuring quality care for the older members of our families.”

LeadingAge PA is a trade association representing 400+ senior housing, healthcare, and community services across the Commonwealth. Visit www.LeadingAgePA.org.