EP’s Flagstone among recipients of $300 million state aid for nursing facilities

Nursing facilities across Minnesota are expressing concerns about the financial solvency of their businesses. The increased costs they have incurred due to inflation and COVID-19 mitigation and prevention, combined with the direct-care workforce shortage, have left many struggling to keep their doors open.

Now, help has arrived in the form of $300 million approved during the last session of the Minnesota Legislature.

Flagstone senior living community in Eden Prairie is included in the funding program. It received $257,094 on Aug. 1 and will receive an equal amount on Aug. 1, 2024.

In response to the financial distress of nursing facilities across the state, the Legislature addressed the crisis by providing not only cash flow assistance and direct lump sum payments but also long-term care workforce retention grants and restoring a program supporting rural nursing facilities.

“This money is primarily meant for debt-related or capital items,” said Dave Rustad, a spokesperson for Presbyterian Homes of Minnesota, the parent company of Flagstone. “The intention was to help nursing homes shore up their balance sheets during these financially stressed years. It was not intended to expand programs or provide additional staffing or enhance wages.

“Flagstone will be using these funds for the one or more of the purposes outlined in the state guidelines.”

The state guidelines are as follows:

• Loan forgiveness for financially distressed nursing facilities: A one-time $100 million investment that will help nursing facilities with cash flow issues. The loans are interest-free, and facilities can determine a repayment plan of up to six years. Facilities will have flexibility on the payment plan to fit their respective needs. 
• Reestablishment of the Critical Access Nursing Facility (CANF) Program: This package restores a program dedicated to geographically isolated nursing facilities that are facing imminent closure. This is an existing program that has not been funded in years. By reestablishing this program through updates and ongoing funding, DHS will be able to move quickly to support nursing facilities facing the greatest challenges. Money will be accessible as early as July 1, 2023.
• Workforce incentive grants for long-term services and supports: An allocation of $175 million is set aside for a new grant program aimed at providers of long-term services and supports. This includes nursing facility workers and is designed to aid in the recruitment and retention of direct support professionals.
• Eligible workers may receive payments of up to $1,000 per year from the workforce incentive fund. Grantees can use the funds for retention, recruitment, incentive bonuses, post-secondary loan and tuition fees, childcare, transportation, and other costs associated with retaining and recruiting workers.
• Direct payments to nursing facilities: In this program, $173 million will be used to deliver two payments to every nursing facility in the state. Nursing facilities will be required to spend this funding on specific costs, such as debt restructuring, avoiding receivership, rent or debt payments, or maintenance costs.
• Nursing facility temporary daily rate add-on: $51 million is allocated for a temporary daily rate add-on for nursing facilities, effective for 18 months from July 1, 2023, to Dec. 31, 2024. Facilities will receive an additional $12.35 per day per resident, resulting in additional revenue for nursing facilities equal to approximately $134 million.