The Massachusetts nursing home industry is promising to boost the pay of thousands of workers who make only a few dollars above minimum wage now that the state budget proposed by Governor Charlier Baker contains an extra $30 million for nursing homes.
But advocates for nursing home residents want more than a promise: They want the Baker administration to specifically mandate that part of the money go to higher wages for workers, many of whom are immigrants and single mothers.
“There has to be a requirement that nursing homes would be using the $30 million toward wages,” said Arlene Germain, president of Massachusetts Advocates for Nursing Home Reform, a nonprofit patient advocacy group.
The union that represents workers in some of the state’s 400-plus nursing homes said its members will be knocking on the doors of lawmakers to ensure workers get their fair share as the Legislature begins hashing out Baker’s budget.
“We will be working with our allies through the legislative process . . . to ensure that new nursing home rates are used as a wage pass-through for the nursing home direct care workforce,” Tyrek Lee, executive vice president of 1199SEIU United Healthcare Workers East, said in a statement.
Rhonda Mann, a spokeswoman for Baker’s Executive Office of Health and Human Services, declined comment on why the governor’s spending plan did not require the new money be used for workers’ wages or benefits.
Massachusetts Senior Care Association, the nursing home trade association, has spent months lobbying for its “Quality Jobs” initiative, a plan that envisions designating roughly $90 million a year from the state budget for boosting pay and benefits for nursing aides and other low-paid workers, including those in housekeeping, laundry, and food service positions.
Statewide, aides who work in nursing homes earn a median wage of about $13 an hour, not nearly enough to cover the cost of rent, food, and transportation, according to a recent association report. Housekeeping, laundry, and food service workers are paid even less. The report said the state’s past failure to boost funding for nursing homes has hampered the industry’s ability to increase workers’ pay, resulting in stagnant wages since 2008.
“We are very appreciative of the governor in taking this critical first step in recognizing the need to invest in nursing home workers and quality care,” said Tara Gregorio, senior vice president of the Massachusetts Senior Care Association. “We look forward to working with the Legislature and administration to make sure wages are supported throughout this budget process.”
The association’s plan calls for the state’s Health and Human Services department to monitor the program to ensure the money is actually going toward an increase in workers’ wages and benefits. It is not clear how the health agency, which has weathered cutbacks in recent years, would manage oversight of the wage initiative.
Gregorio said $18 million of the $30 million proposed by Baker would go toward boosting workers’ wages. The rest would be used to reimburse nursing homes for money Gregorio said the state owes them.
That money is owed because of an arcane process the state uses to get more cash from the federal government. The state in effect taxes nursing homes. Baker is proposing increasing that tax by $15 million annually. That, in turn, would yield $15 million more in federal cash.
Ultimately, nursing homes would get back most of what they had paid in those taxes.
The nursing home industry has been lobbying for a boost in state funding, saying some operators are losing money.
But a review of detailed annual financial reports submitted to the state shows other nursing home operators appear to be profiting handsomely.
A Globe analysis of recent nursing home financial reports shows some companies are paying large sums of money to executives and to companies owned by the executives or members of their families.
Gregorio, the nursing home association’s senior vice president, declined to comment on nursing homes’ financial reports.
Those records show Synergy Health Centers, a New Jersey company that has bought 11 Massachusetts nursing homes in the past three years, listed a $1.8 million payment to the father of one of Synergy’s co-owners in its 2014 financial reports, the most recent available. It also listed hundreds of thousands of dollars in payments to management and realty companies owned by Synergy’s cofounder, Avi “Zisha” Lipschutz.
Financial reports also show that Scott Schuster, owner of Wingate Healthcare, a Needham company that includes 15 Massachusetts nursing homes and three in New York, was paid $1.7 million in 2014 from Wingate’s management company.
The report also lists $1.1 million paid to Wingate Financial Advisors, owned by Schuster, for “administrative services.”