The Michigan Legislature passed a supplemental appropriation bill the week of Feb. 27 that included $75 million to help address the ongoing staffing crisis in hospitals. The appropriation was part of House Bill 4016. Hospitals were allocated the funds for recruitment, retention and training of healthcare workers.
After Gov. Whitmer signs HB 4016, the MHA will work closely with the administration to allocate the funds once they are made available by the state.
The MHA also published a media statement March 1 on the behalf of MHA CEO Brian Peters to thank the legislature for acting. “On behalf of our member hospitals and health systems, we are very thankful our partners in the Michigan Legislature recognized this need and continue to be involved in developing solutions to retain and expand healthcare talent in Michigan.” The statement was published in a Crain’s Detroit Business article.
Members with questions about workforce funding may contact Adam Carlson.
Gov. Whitmer released her executive budget recommendation Feb. 8 for fiscal year 2024. The proposed budget fully protects traditional hospital line items for Medicaid and the Healthy Michigan program, continues targeted rate increases from recent budget cycles and includes new investments in workforce training and development. None of the line items important to MHA members were recommended for reductions in the recommendation.
The MHA will share additional information on the new initiatives in the coming weeks, but below are a few key pieces for MHA members.
New or expanded funding items:
Healthy Moms and Healthy Babies – $62 million.
Implementing recommendations from the Racial Disparities Task Force – $58 million.
Increased rates for laboratory services, traumatic brain injury services and other related professional services – $120 million.
Expanding eligibility for the Michigan Reconnect scholarship program – $140 million.
Building capacity for insulin production in Michigan – $150 million.
Discretionary mental health supports for K-12 students – $300 million.
Items receiving continued, full funding:
The Healthy Michigan Plan (Medicaid expansion).
Hospital Quality Assurance Assessment Program.
Rural and obstetrical stabilization pools.
Hospital outpatient rate increase.
Critical access hospital rate increase.
MHA CEO Brian Peters released a statement in support of the executive budget recommendation, thanking Gov. Whitmer for her continued commitment to protecting hospitals and supporting healthcare workers.
Members with questions about the budget or any other state legislation impacting hospitals should contact the MHA advocacy team.
Based on requirements in legislative boilerplate, the MHA created and distributed to the Michigan Legislature Sept. 28 a report on the results of the state healthcare workforce grant, which brought $225 million to Michigan hospitals for workforce recruitment, retention and training.
The report includes the categories for which the funding was used, the total number of healthcare workers impacted and financial data on the exorbitant growth in labor expense since 2020. Specifically, total statewide labor expense by hospitals per year is estimated to grow by more than $1 billion in just two years. In addition, 69,000 healthcare workers have already benefitted from the workforce grant funds.
The document also includes specific examples and testimonials from several hospitals throughout the state on the benefits of the state funding and how it has been used. The submission of workforce data by MHA members has been extremely useful in the creation of the report and demonstrating the impacts of increased labor expenses in advocacy efforts.
For questions on the report and the state healthcare workforce grant, please contact Adam Carlson at the MHA.
New report outlines hospital community health efforts in FY 2020
The Michigan Health & Hospital Association (MHA) released today the Healthy Futures, Healthy Communities report that demonstrates a nearly $4.2 billion investment in community-based partnerships and programming in fiscal year (FY) 2020. Overall, hospitals invested more than $869 million in community and voluntary-based activities, from education and prevention services to community outreach, research and workforce development.
Data in the report shows investments made throughout the first year of the COVID-19 pandemic, demonstrating Michigan’s hospitals and health systems continued offering a wide range of services and resources to their communities inside and outside of the traditional healthcare setting that improved the overall health, wellness and quality of life of residents.
“Even through some of the most challenging times in healthcare, hospitals and health systems haven’t wavered in their commitment to helping improve the overall health and wellness of the communities they serve,” said MHA CEO Brian Peters. “This report gives a clear and simple message: The impact of our healthcare workforce reaches far beyond the walls of patient rooms.”
In addition to community benefit services and programs, the report also highlights the contributions of hospitals when it comes to uncompensated care. In FY 2020, the unpaid costs of patient care at Michigan hospitals totaled more than $3.4 billion, which includes both financial assistance and bad debt at cost, as well as Medicaid and Medicare payment shortfalls, other means-tested government programs and subsidized health services.
“The programs and services that hospitals and health systems provide have a long-term and positive impact on community health,” said T. Anthony Denton, J.D., MHSA, senior vice president and chief operating officer of University of Michigan Hospitals, Health Centers and Medical Group and 2022-2023 Chair of the MHA Board of Trustees. “Patients and communities became more intertwined than ever as healthcare teams worked to provide care, compassion, financial and in-kind resources and knowledge throughout the COVID-19 pandemic and continue to do so. Our role as anchor institutions is and has always been vital, providing an important uplift to those in need by way of various contributions which demonstrate our value as a major community asset. Through our many efforts, we are privileged to build bridges and connect communities to inform, elevate and empower individuals and families to mitigate social determinants and advance health, inspire hope and foster meaningful presence.”
Included in the report are examples of programs implemented by hospitals throughout Michigan that expand access to care and improve the health of vulnerable populations within their communities.
“McLaren, as a large health system, serves large urban settings and smaller rural communities, and the critical charge of being a community-integrated provider is having a sound, community-based system of care in place,” said Dr. Justin Klamerus, McLaren Health Care chief medical officer. “Increasingly, health care is moving toward care that existed outside of the hospital, both in treatment and preventive practices. It’s part of our responsibility to attune ourselves to the needs of our communities, especially in critical access areas, and doubly so during a time when many may still be hesitant to seek care in a hospital setting. Our facilities in Bay, Caro and the Thumb Region are true in the commitment to their communities and are really working to meet their needs.”
The full report and stories from hospitals across the state that exhibiting community benefit can be accessed online here.
Provides Nearly 572,000 Direct Jobs, 224,000 in Hospitals Alone
The Partnership for Michigan’s Health reports healthcare directly employed nearly 572,000 Michigan residents in 2020, demonstrating that healthcare continues to be the largest private-sector employer in the state despite staffing losses attributed to the COVID-19 pandemic. The 2022 release of The Economic Impact of Healthcare in Michigan shows direct healthcare workers in Michigan earned $44.2 billion that year in wages, salaries and benefits. Hospitals alone employed 224,000 individuals in the state in 2020.
Direct healthcare employment helps create additional jobs that are indirectly related to or induced by healthcare. These indirect, healthcare-supported jobs are held by more than 502,000 people who earned about $28 billion in 2020 in wages, salaries and benefits. Together with their employers, the nearly 1.1 million workers in the healthcare sector contributed almost $15.2 billion that year in local, state and federal taxes. These taxes include Social Security, income, motor vehicle, sales, property, corporate and more.
Data from 2020 shows the early impact the pandemic had on the economic strength of the healthcare sector in Michigan. In particular, the data illustrates the rise in labor costs as many nurses transitioned to contract labor with staffing agencies. Compensation for direct jobs in Nursing and Residential Care rose by about $200 million from 2019 to 2020, although the number of jobs fell by about 11,000. Specific to hospitals, the number of jobs fell by about 7,000 jobs from 2019 to 2020, but total compensation remained about the same.
The loss in jobs represents the initial exit of many healthcare workers due to burnout and stress associated with the pandemic. Both nationally and in Michigan, healthcare experienced a shortage of healthcare employees for several years and the pandemic caused a sudden loss of existing workers. With Medicare beneficiaries in Michigan increasing by more than 8% over the past five years to a total of 2.1 million people, Michigan needs more healthcare workers, now more than ever, to serve the changing needs of the state’s aging population.
The trend of nurses transitioning to contract labor is supported by recent research from the American Hospital Association, which found labor expenses per patient for hospitals increased 19% through 2021 compared to 2019. Increased labor expenses have a more profound impact on hospitals and health systems, as labor expenses account for more than 50% of total expenses for most hospitals. In addition, healthcare reimbursement is unable to quickly respond to inflationary pressures since rates are negotiated months in advance, presenting additional financial challenges when responding to sudden labor market demand.
The report was compiled by the Partnership for Michigan’s Health, which consists of the Michigan Health & Hospital Association, the Michigan State Medical Society and the Michigan Osteopathic Association, all based in the greater Lansing area. It uses 2019 and 2020 data, which is the most recent available.
“This report demonstrates the unquestionable and significant role healthcare, and specifically hospitals, play in Michigan communities,” said Michigan Health & Hospital Association CEO Brian Peters. “Not only have they played a vital role in the care and treatment of patients, but they remain far and away the leading employers and large drivers of economic activity.”
“Healthcare careers are not only extremely rewarding, but crucial to our society,” said Kris Nicholoff, executive director of the Michigan Osteopathic Association. “While healthcare careers remain in high demand, the data shows there are over a million individuals we owe our gratitude toward for providing care during one of the most trying and tumultuous years in modern history.”
“Physicians are and will continue to remain a key driver of healthcare employment and economic growth,” said Julie L. Novak, CEO of the Michigan State Medical Society. “Investing in physician-led team-based care and healthcare careers is key to the economic vitality and health of our state, local communities and residents. Physician practices, hospitals and other care settings offer good paying and stable jobs in careers that truly improve and save lives.”
Hospitals and healthcare providers remain focused on ensuring these jobs meet the needs of their employees, from offering competitive compensation and benefits to ensuring a safe and supportive work environment. The Partnership for Michigan’s Health joined several other organizations in the Healthcare Workforce Sustainability Alliance to advocate for state funding to support the recruitment, retention and training of healthcare workers. These efforts were successful in Public Act 9 of 2022 which allocates $300 million in state funding to support Michigan’s healthcare workforce.
The 16th and 17th editions of The Economic Impact of Healthcare in Michigan were compiled using IMPLAN® cloud software to quantify healthcare’s significant economic impact in the state. The data represents direct, indirect and induced healthcare jobs; taxes paid by those workers and their employers; and salaries, wages and benefits earned. The report is an online, interactive tool that allows users to examine these economic impacts from a statewide perspective and by region, county or congressional district. The data from both 2019 and 2020 is provided in two separate data tables. It is available at www.economicimpact.org.
The Safety from Violence for Healthcare Employees (SAVE) Act is newly proposed federal legislation to give healthcare workers the same legal protections against assault and intimidation that flight crews and airport workers have under federal law. U.S. Reps. Madeleine Dean (D-PA) and Larry Bucshon, MD, (R-IN) are the original cosponsors of the bill, and the MHA urges all members to contact their U.S. representative to ask them to cosponsor H.R. 7961. Contact information is available through the American Hospital Association’s action alert on the bill.
The increase in acts of violence against healthcare workers in every setting — inpatient, outpatient, ambulatory and home care — is frightening, and the MHA is committed to doing everything possible to respond to this crisis and show support for those delivering patient care. In addition to offering federal-level protections to healthcare workers, the SAVE Act would provide grants to hospitals for programs to help reduce the incidence of violence in care settings. These grants could be used for training hospital personnel, coordinating with state and local law enforcement, and purchasing equipment or technology that will assist in creating a safer environment.
On a related note, the MHA has developed workplace safety posters for members to display throughout their facilities to highlight the consequences of causing physical harm to healthcare workers or hospital property. Complimentary copies of the materials are available to MHA members upon request.
Members and other citizens concerned about the safety of healthcare workers are encouraged to ask their U.S. representative to cosponsor the SAVE Act as quickly as possible. It is among the MHA’s highest legislative priorities at the federal and state level. For more information, contact Laura Appel at the MHA.