Will budget deficit, expiring healthcare contracts add up to strikes?

Thousands of nursing home workers will be asking for wage and benefit increases come March.

But their employers are largely funded by the state, and the state is broke.

“It’s not likely we will be able to increase spending for nursing homes,” said Rep. John Geragosian, D-New Britain, chairman of the Appropriations Committee. “They are unsustainable right now, and we have to rethink how we deliver these services.”

Almost 10 percent of the state’s nursing home workers – or 5,500 people at 50 different nursing homes – have contracts up for renegotiation at the same time state lawmakers are figuring out how to deal with an estimated $3.4 billion budget hole themselves.

The last time so many contracts were set to expire was in 2005. The state avoided major employee strikes then because of federal assistance, which gave nursing home management some resources to meet their staff’s demands.

But in May 2001, no such lifeline was there, and an estimated 4,500 union employees walked off their jobs after negotiations broke down.

“We are hoping it doesn’t get to that this time around. There are some tremendous risks here, but also some great opportunities to deal with these problems,” said Deborah Chernoff, spokeswoman for the New England Health Care Employees Union SEIU 1199.

That fact so many contracts expire at the same time is no coincidence, she added: “We have more leverage this way. Lining up these contracts makes it a statewide problem and not a single legislator’s problem.”

The Connecticut Association of Health Care Facilities, whose members will negotiate many of the expiring contracts, said the way nursing homes are funded makes it difficult to avoid strikes.

“We’re in an environment where it’s very difficult for the nursing homes to satisfy their employees,” said Matthew V. Barrett, the association’s executive vice president. “These contracts are coming up at a time of enormous fiscal pressure for these homes.”

The association’s 110 member facilities have an estimated 30 contracts expiring come March. Statewide, there are 238 nursing homes with approximately 28,300 beds. Thirty percent of those homes are unionized.

The state will spend $1.3 billion of an $18.64 billion total budget on nursing home care this fiscal year, which ends next week. For the upcoming year, the state budget has flat-funded appropriations for nursing homes at $1.3 billion.

Sen. Paul R. Doyle, D-Wethersfield, co-chairman of the Human Services Committee, said nursing home workers are going to need to be sympathetic of the fiscal crisis the state is in right now.

“The key is we are not in great times right now, but we do have to make sure our seniors aren’t suffering,” he said.

Doyle’s committee and the Public Health Committee will hear testimony Thursday at the State Capitol from the nursing home community on the fiscal challenges nursing homes are facing.

Sen. Edith G. Prague, D-Columbia, co-chair of the Aging Committee, says everyone needs to realize “the state doesn’t have a magic wand to make money appear. This is not a situation where anyone is going to be happy. I support increasing staffing levels and pay, but we are in major trouble right now.”

She did say there is money to be saved by increasing the number of people receiving in-home care instead of living in nursing homes.

A study, commissioned by the Connecticut Regional Institute for the 21st Century, projects that a dramatic shift toward non-institutional care would save the state $900 million over the next 15 years. The report says state government spent $32,902 per client served at home or in the community in 2006 compared with $74,637 per institutional patient.

The association went to court in an attempt to shield nursing homes from budget cuts next year, but was unsuccessful. U.S. District Court Judge Peter C. Dorsey ruled earlier this month that it is “highly unlikely” that the federal court has the authority to meddle in the rates the state sets to reimburse the homes.

Because of frozen reimbursement rates since 2007, Barrett said nursing homes have had few alternatives to cope with their budget shortfalls. A lack of money has forced homes to cut staff, reduce hours and avoid pay raises when legally possible.

“Care is jeopardized when these cuts are made,” he said.

The last major nursing home strike in 2001 lasted more than one month and involved 39 nursing homes. Then-Gov. John Rowland responded by spending $26 million to hire replacement workers, to the displeasure of the employee unions who said that money could have been used to improve pay and staffing levels.

Chernoff  said the likihood of a strike this time around is largly dependent on who is elected to become the state’s next governor and what approach that person will take in funding nursing homes.

“Hopefully there will be a new attitude in the next executive branch,” she said, adding that Republican Gov. M. Jodi Rell has been “uninterested” in negotiating “reasonable” rates. “The budget director has made it very clear they prefer to close nursing homes.”

Regardless of who is elected, Chernoff said the employees plan on calling on the next governor to pump millions into the homes, where two-thirds of the patients are on Medicaid. The state and federal governments share the bill for those patients.

“There are too many homes that if they have another bad year they are going to close. They are drowning,” she said.

In case new contracts can’t be reached through negotiation, nursing homes are required to have contingency strike plans on file with the Department of Public Health.