The only thing separating Kelley Miller from living in a nursing home is a registered nurse and aide caring for her around-the-clock inside the 54-year-old quadriplegic woman’s home in the mid-Michigan village of Mulliken.
Paralyzed from the neck down in a 2011 car accident, Miller relies on a ventilator to help her breathe — and the caregivers to bathe, clothe and move her between chairs.
Sometimes the ventilator tubing comes unhooked when Miller’s caregivers transfer her between a chair, her bed or the shower.
That’s when the nurse has to work quickly to reconnect and troubleshoot the ventilator while the aide uses a device to hand pump oxygen into Miller’s lungs — and keep her alive.
“I just need two people just in case something goes wrong,” Miller said.
Miller’s in-home care is about to change drastically if a 2019 law signed by Gov. Gretchen Whitmer takes effect July 1, according to the owner of the home health care agency that staffs her 24/7 caregivers.
1st Call Home Healthcare in Clinton Township is telling Miller and dozens of other clients that it will shut down June 30 because the new auto insurance reform law caps hourly attendant care at 55% of what providers were charging in January 2019.
“I potentially could end up in a nursing home,” Miller said.
The 55% cap on rates would lower the home health care agency’s charges from $70 per hour for a registered nurse to $38.50, less than the market-rate pay of $40 to $45 per hour for skilled nursing, said Bob Mlynarek, co-owner of 1st Call Home Health Care.
“For 55%, that barely covers the wage of the aide or nurse, let alone any payroll taxes, any office overhead, our accreditation, printing, copying, office rents, electricity,” Mlynarek said. “We will be out of business, to make a long story short.”
The fast-approaching July 1 date for the auto insurance law Whitmer signed two years ago at the Mackinac Policy Conference has set off a last-ditch lobbying effort by medical providers and the post-acute care industry to get lawmakers to delay or change the fee schedule.
“We are at a crisis at this point for access to care for these individuals who bought a policy that guaranteed they would have access to the care they needed should they be unfortunate enough to get in an auto accident,” said Margaret Kroese, executive vice president for Hope Network Neuro Rehabilitation.
The 2019 law did not exempt motorists critically injured years — even decades — ago from the new cost-controlling fee schedule, which includes capping most hospital charges at 200 percent of Medicare rates and subjecting group homes and brain rehab centers to the 55% cap.
Hope Network operates brain injury rehabilitation residential facilities in Grand Rapids, East Lansing and Kalamazoo that are a post-hospitalization transition for injured motorists to relearn to walk, talk, swallow and regain cognitive skills lost in vehicle and motorcycle crashes.
“They will not continue to admit these patients at that 55%,” Kroese said.
Hope Network also operates about 16 adult foster care group homes in Coldwater, Kalamazoo, East Lansing and suburban Grand Rapids for catastrophically injured drivers to live in lieu of institutional care facilities.
Those, too, are in danger of going under, Kroese said.
“I think most of the current group homes can’t survive under the 55% cap,” she said.
The alternative to severely disabled individuals who need highly skilled care is to move into nursing homes, though home care industry leaders doubt there are enough accredited nursing home beds in Michigan to handle the immediate influx of several thousand new patients in July.
“Even if you get a bed in a nursing home and you’re a (quadriplegic), oh my, you’re not going to get one-on-one care, you’re not going to get turned every two hours, you’re not going to get skin care — and they break down and die,” said John G. Prosser II, vice president and partner in Health Partners Homecare, a Bingham Farms-based home health agency with more than 500 caregivers.
Prosser said his bankers are aware of the new law and how it will upend his business model.
Without a legislative change in the fee schedule, “I’m going to close the doors on June 30,” Prosser said. “There’s no turning around — I can’t send anybody into the field on July 1 knowing that I’m only going to get 55% of it.”
House Bill 4486 and Senate Bill 314, identical bills introduced in the Legislature last month with bipartisan co-sponsors, would set hourly attendant care at 200% of Medicare or their average charges in January 2019, whichever is less.
Sen. Jim Runestad, a White Lake Township Republican and co-sponsor of SB314, said he’s trying to get the majority party’s leadership to consider the bills with some urgency given the July 1 deadline.
“You can’t have a person whose life depends on that individual on an hour-by-hour basis, yank that person out and put them without a home health aide — they’re dead,” Runestad said.
Before being elected to the Legislature, Runestad sold long-term nursing home insurance policies to seniors. He’s spent most of his career going inside nursing homes. He’s skeptical those facilities can provide the same kind of care in-home attendant care agencies do.
“These are people who need around-the-clock care, and you don’t get that in a nursing home like you do when you have somebody at your beck and call in the home,” Runestad said.
Whitmer, a Democrat, and the Republican-controlled Legislature’s sweeping changes to Michigan’s no-fault auto insurance law were made with promises to lower rates for drivers, who pay the highest premiums in the country for what’s always been considered the gold standard of coverage for medical injuries sustained in auto accidents.
In order to drive down insurance premiums, the new law lets motorists begin opting out of carrying unlimited medical coverage, letting them off the hook for a $220-per-vehicle fee that pay for catastrophic care for injured motorists like Miller.
The Michigan Catastrophic Claims Association’s annual per-vehicle assessment is scheduled to drop from $100 to $86 on July 1.
That’s a result of the caps on attendant care for some 4,000 disabled adults whose care amounts to two-thirds of the MCCA’s $1.3 billion in annual claims, MCCA Executive Director Kevin Clinton said.
“There is a lot of fat in those rates, in my opinion,” said Clinton, whose organization’s board consists of auto insurance companies.
Some lawmakers were under the impression that motorists such as Miller who were injured years before the law change would be grandfathered in and continue to receive the same care.
“There was no grandfathering,” Clinton told Crain’s.
The governor and Legislature’s exclusion of a grandfather clause for people with existing injuries and disabilities “essentially revoked their access to care,” Kroese said.
Runestad, who voted for the new law in 2019, said insurance companies have painted a broad brush about the attendant care industry without acknowledging the pitfalls of residential care.
“The insurance companies say nobody’s going to die, they’re all gouging, they’ll make lots of money at 55 (percent),” Runestad said. “I just see so many problems with the way this is being done. It’s not being done in any scientific way. It’s being done with just a blunderbuss approach.”
Hope Network’s top lobbyist worries lawmakers may be inclined to let the fee schedule go into effect July 1 and then re-evaluate the cost-control measures based on the impact.
“Everybody wants to wait and see how bad it is,” said Joe Haveman, government relations director at Hope Network and a former Republican lawmaker from Holland. “You can’t do that with people’s lives.”
‘Not nursing home material’
At 1st Call Home Healthcare, Bob Mlynarek and his two business partners — all retired firefighter-paramedics — are preparing to shutter their 6-year-old business that’s largely dependent upon clients with no-fault auto insurance.
The company, which had $6 million in revenue last year, has 14 office administers and 180 in-home direct care workers that include registered nurses (RNs), certified nursing assistants (CNA), licensed practical nurses (LPN), physical, speech and occupational therapists and lower-skilled caregivers.
Mlynarek said there’s no way the agency can continue providing its services with a 45% reduction in charges.
“I’m one of the smaller guys,” he said.
For the higher-skilled aide a quadriplegic such as Miller requires for physical transferring, 1st Call Home Health Care charges auto insurance companies $35 an hour. The new law would cap that hourly rate at $19.25, leaving little room for paying a caregiver a competitive wage in a labor market that’s already experiencing a shortage, Mlynarek said.
“You’re not going to get anybody to work for you for the amount of money they’re going to pay,” Miller said. “I potentially could end up in a nursing home.”
The current hourly charges for attendant care for catastrophically injured individuals is not always what insurance companies ultimately pay out on claims.
“When we bill $35 for a high-tech CNA, that doesn’t mean we’re getting $35,” Mlynarek said.
“They pay us what they want. We end up having to litigate — and it takes years. By the time you do that, the attorneys get one-third of it.”
For Miller, changes in how her in-home care is paid for have her nervous about how it will affect her quality of life. She doesn’t let her paralysis stop her from getting out of the house often to go shopping at flea markets and attend family birthday parties. She has both caregivers with her at all times to assist in those activities, give drinks of water and ensure the ventilator is continuously operating.
“I am quite healthy, even though I’m a quad,” Miller said. “I’m not nursing home material.”
This story first appeared in our sister publication, Crain’s Detroit Business.