Steven Malanga and Chris Pope join Brian Anderson to discuss how long-term-care facilities have borne the brunt of the Covid-19 pandemic, innovative approaches to nursing-home staffing and training, and what we can learn from the experience to be better prepared next time.
Audio for this episode is excerpted and edited from a live Manhattan Institute Eventcast, entitled "The Center of the Pandemic: How Long-Term-Care Facilities Bore the Brunt of Covid-19."
Brian Anderson: Welcome to the Manhattan Institute's Eventcast. And thanks very much for joining us. I'm Brian Anderson, the editor of City Journal and today we'll talk about how long term care facilities bore the brunt of the COVID-19 pandemic and what we can learn from that fact. We'll draw upon recent writings on this important issue by City Journal and Manhattan Institute experts. Throughout the program please submit your questions as we go along and I'll try to include them into our discussion. Let me introduce our two panelists first, Steve Malanga. He's the senior editor of City Journal and the George M Yeager fellow at the Manhattan Institute. Writing for City Journal, Steve has pointed to the inadequacies in American nursing homes. Even before the pandemic as Steve notes, the US fell short of protecting the elderly in longterm care facilities from infectious diseases.
Our other guests today is Chris Pope. He's a senior fellow at the Manhattan Institute. Chris's research focuses on healthcare, market regulation, hospitals, entitlement design, insurance market reform. In City Journal, Chris has highlighted successful innovative approaches to staffing during the pandemic that can be a model perhaps for other facilities. So we'll talk a bit about that.
So let me start with you, Steve. The pandemic has proved devastating for nursing homes nationwide. According to some estimates, as much as 40% of the overall count of people who've died in America during the pandemic were nursing home residents. But as you pointed out in a City Journal piece back in April, though this is a horrible and tragic situation, it's also not all that surprising. So what went wrong?
Steve Malanga: Well, first of all, let's talk specifically about the extent of it and where it went wrong. At this point, the best counts are that about 55,000 people may have died in longterm care facilities out of nearly 300,000. It's almost a 20% death rate which is really shocking although again, this is our most vulnerable population probably. To talk about where it's happened, New Jersey is actually led the way. The States with the most deaths in nursing homes are New Jersey, New York, Massachusetts, Pennsylvania, Illinois, California, Connecticut, Michigan.
The States with the highest percentage of deaths in nursing homes, some smaller States, New Hampshire, Rhode Island, Minnesota, Connecticut, and Pennsylvania. We can talk a little bit about some of those States later on. However, here's then the real shocker in 23 States more than half of all deaths have been in longterm term care facilities. Now, the thing is, this was not completely unanticipated by some of us who were writing about early for this reason. Early on, I wrote a piece called the Virus and the Economy, which really attempted to look at what were the health implications of shutting down the economy because I wanted people to try to balance, understand there were health implications to shutting down the economy.
And I wanted them to balance that with the predictions about deaths from COVID, because that's a very easy number to understand. One thing that impressed me while I was doing this, is that a number of health experts, especially epidemiologists were talking early on about those trade offs and they were afraid that a panic was emerging in America. Remember this was mid March I did this. They were afraid there was a panic that was emerging, that was going to make us miss the target. And one prominent researcher said something that stuck with me. He said, "Our focus needs to be on the most vulnerable." He said, "Nursing homes not schools." Immediately after hearing that, I went and started looking at what the record was if you would of nursing homes in terms of infectious diseases. Now, the thing about COVID-19 is it's new, it's unique, but it is basically a respiratory infectious disease and every flu season, we have similar problems with pneumonia and the flu. And I looked at the record in nursing homes. There's a lot of academic research on this and it's pretty startling.
In particular outbreaks are very common. The notion of States mandating protections is very erratic. Only about half of States even require nursing home workers to get a vaccine. We have vaccines for the flu and we're talking so much about how the vaccine is going to save us from COVID but only about half of States require vaccines from nursing home workers. And if you look at it, not even nowhere near 80 to 90% of nursing home residents themselves get vaccinated. You would think that in this vulnerable population that we would be focusing on that and that nursing homes themselves are bringing doctors and make sure this is done or nurse practitioners.
The other thing is there's a lot of criticism of the record on nursing homes in terms of infection controls. In some surveys, 40% of homes during flu season have essentially failed their inspection protocols for infection control. So all of this was very, very troubling. And what then occurred quickly after this, more than anything justified the concerns that we were starting to hear from some of these people like this expert who said again, nursing homes not schools. And yet at the same time, we'll talk about this a little bit more later, what I was hearing from some of the governors was that essentially this COVID was a nobody left behind.
Phil Murphy, the governor of New Jersey said, when people brought up the idea that this was mostly a disease targeting older people [inaudible 00:06:23], "We're not going to leave anybody behind. Andrew Cuomo famously said, when people suggest what's the right focus here, he took that to mean we're going to leave the elderly behind. And he famously said, or infamously said, "My mother is not expendable." But the fact of the matter is when you look at the history of the way we treat the seasonal flu in which every year thousands of people, tens of thousands of people die in this country, and the way we treat the issue in nursing homes we have we've never had an attitude we're going to leave everybody behind. And so that was very troubling and the numbers we're seeing really reflect that. And we're not obviously out of it yet, so we'll have to see where.
Brian Anderson: Thanks, Steve a lot. Chris maybe you can follow up a little bit on what Steve just said about the particular vulnerability to COVID of the nursing home residents. Why it's such an infectious environmental apart from the problems that Steve isolated. And then I'd like you to say a little bit about what role of finances and payment system that work in the nursing homes might've played a role in this crisis?
Chris Pope: Yeah, well, Steve's obviously exactly right. This is not a new problem. It's [inaudible 00:07:48] we deal with every year. The idea of large amounts of elderly people dying in nursing homes from infections is certainly not a new thing. Every single year, an average of 380,000 people die of infections in nursing homes. And really we should have seen this coming, and I think Steve's rights make the comparison will we sacrifice for schools, will we sacrifice their [inaudible 00:08:10] versus will we sacrificed to have nursing homes kept safe, secure, and doing the job that they are to do.
We've clearly had a failure political will really in terms of dedicating the resources and dedicating the sacrifice to protecting nursing homes that we've been willing to make for all the sectors as a society. And I don't think there's really much indication that that's going to change at all soon. The basic thing I think you can say about nursing homes in the COVID crisis, like so much of healthcare policy is really the old adage, you get what you paid for. And when it comes to nursing homes, we really try and skimp.
Nursing home revenue's are very heavily dependent on the Medicaid program to an extent that no other part of the healthcare system is. So if you think of a hospital, usually about half of the hospital's revenues comes from private insurance, which is generally a very generous reimbursement source. It generally supports a lot of intensive care, means that no expenses spared in terms of safety, in terms of cleanliness, in terms of quality of equipment, but when it comes to nursing homes, the majority, I think about 52% of nursing home revenues come from Medicaid and private insurance is probably only about 15% of nursing home revenues.
And as with hospital care, Medicaid rates are very, very low. So on average, Medicaid pays about 89% the average cost of looking after someone in a nursing home, which means the nursing homes have to scramble to get revenues from Medicaid, from self paying patients, really to stay afloat. And they tend to cut corners. They tend to cut corners on staff, they tend to cut corners on safety, we saw in a lot of cases that personal protective equipment was often really absent, but also when you cut corners on staffing, that really means that quite often homes are relying on sort of free to medical interventions and medicating residents who may be or not to be medicated if staff are overstretched, they're not really taking as much care with each patient as they ought to be. And so you end up with a lot of lapses essentially in what should be the provision of a basic service.
In an environment where any kind of disease can really spread very, very quickly, the idea that everyone has a personal room really doesn't apply to most nursing homes. Most rooms are shared, most staff visiting numerous rooms one after the other. And so if you sort of think about, there've been discussions of herd immunity that maybe if 60% of the population catches the disease, then it'll die off. Well, in some nursing homes you've seen it go like over 90% of people within the nursing home have gotten the disease just because people whether they're asymptomatic or whether the staff are with dealing with light cases are going from room to room before they're really withdrawing from the nursing home. And pretty much everybody in many homes have been infected.
Brian Anderson: Thanks, Chris. So shifting gears a little bit Steve here in New York the estimates are that as many as 6,000 seniors have died of COVID-19 in senior care facilities. And governor Cuomo has come under some fire for this outcome. I'm wondering, what's your view of what happened in New York and have we seen similar situations in other States?
Steve Malanga: Well, if you look in terms of the percentage of people in States dying from this, it's fairly high in many places. The controversy about New York is actually controversy that occurred in a dozen places where governors or public health officials as part of the administration ordered essentially nursing homes to take back residents who had gone into the hospitals and then were released when they were thought to be out of danger. They were released in some cases without actually requiring that they test negative for the disease. This happened in New Jersey, it happened in Pennsylvania to different degrees.
So some of the controversy is number one, that staff in some of these places, first of all, the nursing home operators themselves in New York and other places vigorously objected to this, the idea of sending people back. In New Jersey, the kind of public health bureaucracy meaning the longtime bureaucrats not the actual administration, director of public health for commissioner of public health who was politically appointed, but the staff kind of revolted against this. They've even sent letters, whistleblower letters if you will, to members of the legislature in New Jersey, complaining that they objected to this, that the governor didn't listen to them, that this was not a good thing to do for obvious reasons.
So essentially what happened was there was a panic. And this is where the whole idea that the panic was driving unwise decisions really comes into focus. Because in New York they feared and in New Jersey that the hospitals were going to be overrun. And because they feared that they said, "We've got to get people out of hospitals as fast as we can." This occurred even though there was supplemental hospital beds available, even though for instance in New York, they built up a temporary hospital facility in Javits Center, they had the US Navy ship come in and many of those beds were never used yet they were pushing people because there was this panic about almost a hospital bed apocalypse, if you will.
And this is where the whole idea that we were kind of losing control of the circumstances and the situation really becomes evident. Now it's fair to say that there would have been a problem anyway given a couple of things. Number one, as Chris said we were in the middle of flu season and a lot of nursing homes didn't have adequate protective gear anyway. And I know there was a shortage of protective gear once COVID hit, but many of these nursing homes didn't even have adequate protective gear. We're in the middle of pneumonia season, we're in the middle of flu season. That clearly would have been a problem.
There is no vaccine obviously for the workers, there's no vaccine for family members who were visiting until we realized the seriousness of the problem. Having said that, there's still a lot of criticism of those particular States. And in particular, first of all, just the idea of sending people who still haven't tested negative yet for the disease back into nursing homes to the most vulnerable population, how does anyone make that decision?
Now, in fairness, the... I guess you could say in fairness, New York state has released its own study of what really caused the problem in nursing homes. And they have concluded, not shockingly that it wasn't that decision by the governor and the the public health authorities, they've concluded that it was the workers. Their idea is that about in some cases, they estimate that as many as almost 30% of all nursing home workers were infected and they've brought it in from the outside.
Now, there are a bunch of people contesting this idea. First of all, there are people just even people in both parties in New York state saying, "We need an independent study of this." But the reason people are... One of the reasons is there is an unusually high number of workers in a particular industry that got these infections. And the idea is yes, there is a history of workers bringing infectious diseases into nursing homes but it works the other way too, when you're sending people who are infected back into the homes, you're likely to infect the workers as well as the other the other member of the other residents and those workers are working on five, six, seven different residents a day. So they're essentially spreading it around. So essentially the notion that it was the worker's fault, if you will, or it was an unavoidable factor, it's gotten a lot of criticism.
Also this report, controversially absolve, the nursing homes, it said the nursing homes could do nothing to stop this wave. And that that upset a lot of people who are very critical of the past experience of nursing homes because what their procedures have been lacking again with the seasonal flu, with pneumonia and past flu seasons of past infectious disease seasons. And so the idea that this was just a train wreck actually that no one could stop, that the state couldn't stop and that the nursing homes couldn't stop, or at least ameliorate strike some people as a little bit naive. So that's kind of where we are right now. Now, again, it's important to understand that it wasn't just New York. There were 12 States. New Jersey was another one and New Jersey, New York lead the list of total deaths.
And in particular one of the things again, there's some things that are upsetting about this. One of the things that I find very upsetting is that in New Jersey, they actually, when this first started and people weren't even aware, the general public wasn't aware that the governor or the government had ordered the nursing homes to take back the workers, when these deaths started the state actually began a naming and shaming effort to name the nursing homes where lots of people were dying. Now, this was actually consistent with what was going on in New Jersey. If you drove around New Jersey during the pandemic, you'd see those electronic signs that are by the side of the road, they also had signs, which said, "Don't be a knucklehead." Now this is the governor. The governor was saying that the reason that the COVID was spreading across the state, because there were so many people, they weren't observing social distancing, they were being knuckleheads.
This was another version of this. They're actually blaming the nursing homes. They're actually have a program of naming and shaming until it came out that the government itself had ordered people back from the hospitals into the nursing homes. So that I think has upset a lot of people. Let me just say out another thing. Not every state did this by any means. Florida was one state that did something very different. Florida has, still a large percentage of the deaths are in nursing homes. But the total numbers of infections and deaths in homes is much smaller. Now here's the thing. Florida did a bunch of different things. They never of course put out this ruling, this executive order to send people back into the nursing homes. They actually did the opposite.
What they did was rather than worrying about hospitals filling up too quickly, when outbreaks began in nursing homes they took everybody in those facilities. These are smaller facilities. They took everybody and they sent them to hospitals where they could be isolated and cared for and watched much more carefully. They even got a waiver from the federal government so that the people who had not yet tested negative, [inaudible 00:20:21] positive rather for disease could still be sent to hospitals and reimbursed at the rate that the federal government was reimbursing for COVID care because they felt it was important to get these people in an environment where there was better care.
Connecticut did something different in that they created, COVID only nursing homes to isolate their patients from essentially the rest of the population. It took them a while to do that, which is one of the reasons why they still saw a significant number of deaths but they eventually did it. Now we're at the point for instance, in Florida and a bunch of other States where they're testing nursing home workers twice a week, and they're testing residence numerous times a week. And so that may account for some of what we're seeing as this kind of part of the wave slows down if you will. The momentum and these kinds of deaths starts to slow down.
Brian Anderson: Chris, speaking of Connecticut one of the things you wrote about in your piece on this is to the kind of innovative assistant living facility in that state that really avoided at least the last we checked a lot of these problems. Maybe you could say a bit about that institution and what they did, and whether that could be a kind of model going forward for other such institutions.
Chris Pope: Yeah, of course. I think a lot of the big challenges with the nursing homes has been, we really underestimated what took initially to keep the disease out. Like the initial advice was wash your hands, a little bit of social distancing, maybe check people's temperature on the way in. And as we know there were lots of asymptomatic cases and so all it takes is a couple of asymptomatic staff members to go into the nursing home and all of a sudden the disease is everywhere. Staff members are potentially living with other family members that have jobs as essential workers or that work in other nursing homes or they're taking public transport into the nursing home every day.
And so while much of the population is sort of social distancing or safe at their home, nursing home workers are actually exposed to the disease all the time because they're circulating in the community and really quite often connects to other people who are in high risk situations. And our initial attempts to basically keep the disease out of the nursing home was pretty ineffective in so many cases. In New Jersey, 85% of nursing homes have had cases of COVID within the nursing home.
And obviously once the wall is breached in a sense, and your best you can do often is just to pray that you get lucky. So what one facility in Bristol, Connecticut tried to do the Shady Oaks facility is they decided that they wanted to set up a perimeter around the facility and almost put themselves in a bubble and say that nobody comes in, nobody comes out. All the staff would be housed within the facility, they would stay there overnight and they actually rented some trailers to be parked in the parking lot. They rented the house next door to house the staff and they would make sure that the facility for the duration of the big wave would be cut off from the outside world so that everybody would be safe and that there would be no disease coming in and out.
This was an assisted living facility so it wasn't getting any money from Medicaid, it wasn't getting any money from Medicare. It was really a private pay facility but what they own a dad is he basically cut off his own money to keep the facility secure. Now, part of this actually is... Part of it obviously is kind of smart and sort of forward thinking, but then also part of it also works out sort of in a self-interested way in the sense that it gets very expensive if you have many, many cases in your facility. And it gets very, very expensive if your resident start dying and you're not getting paid, you're having to potentially sort of keep a disease outlets already within the facility. Your exposure to lawsuits becomes much greater.
And so securing the facility at the outset actually is in some ways a smart business move as well. The difficulty for other facilities is really just the liquidity problem to a large extent. Now nursing facilities have very very thin profit margins. Usually over the past few years, really less than 3% on average. And so their ability to put the outlays to basically pay hazard, pay for staff to stay overnight for staff to basically not go back to their families is very, very limited.
What the Connecticut facility decided was you have to make it worth staff's while to be away from their family for a couple of months. That was what they did. You got to basically pay them enough extra money that the staff can go to their families and go to their spouses and kids and say, "I'm going to be away for a little while but this is going to be worth our while as a family to do this." And that's what they did. And they basically wrote out the way in Connecticut while two thirds of the nursing homes in the state were basically subject to cases. They kept it out of the facility very successfully.
Brian Anderson: We're almost out of time. So let me ask a very general question to both of you to conclude. Cases have continued to rise in a number of States, I would say the majority of States right now, it is possible that we're going to be hit with a second wave of COVID-19 here in New York in the fall. What do you see in terms of the near and longterm future for nursing homes? Do we have a better sense now of how to go forward? Are there policy movements a foot that that could make things a little better if we go through this again?
Steve Malanga: One thing I would say, which is also, I think in a way an answer to a question which was what's the ideal policy for nursing homes is we are inching our way towards that. There are a couple of things that we should have been doing it from the very beginning, which we're doing now. We're again, I said this before, we're testing the workers several times a week. Number two, we're actually checking residents several times a day for symptoms including temperature checks and we're testing residence. These things enable us first of all to see who's positive very quickly.
We also now have a root out of nursing homes. They've geared up with their protective equipment. So beyond all of the ideal kind of solutions longterm like better reimbursement and higher levels of staffing and better care, the stuff that we're doing now that, believe it or not weren't doing in March, we weren't doing in April and we weren't even doing at some places in May, including just checking people for symptoms, testing people every day and nobody, no governor was going to say to a nursing homes and ever again, at least during this pandemic, "You have to take people back before they've tested negative for the virus." So those things alone I think are probably a fairly big leap forward.
Chris Pope: All right. I completely agree with Steve actually on that. I think that firstly get the basics right. Things on PPE protective equipment, the testing that we really should have been doing from the outset. Now we're actually a little bit more prepared. Those are going to get done. And then it's just basically if the financial issue. Making sure that these homes have got the money often being like it's not like these aren't bad. These are bad people that aren't trying.
They're just incredibly stressed for resources. And that kind of comes to the final issue and probably the crux of the matter is how much the people care. Are we willing to just allow nursing homes to be like a place that you will avoid and place that you really want to it just kind of allowed to fall apart in the way that we have or is there going to be some kind of political mobilization to maybe put these a little bit higher up the list of political priorities? Are we going to start, to sort of reflect Steve's earlier point, which I thought was the best one is like, we care a lot about schools. Are we going to start caring equally about getting nursing homes right in future. It's not a healthy situation in a year when we get vaccines, nursing homes are still not going to be completely fine.
Brian Anderson: I wanted to thank Steven Malanga and Chris Pope for your informed commentary today. And I want to thank all of you for joining us today. Please consider subscribing to the Manhattan Institute's newsletters, making a contribution to our mission. So thanks again to both of you and thanks everyone for joining us again today.