Zac Schultz:
As the baby boomer generation continues to age, the need for assisted living facilities in Wisconsin will continue to grow. With one recent estimate saying we’ll need more than 60,000 additional beds over the next 15 years. More and more seniors and their families are using a referral agency to help them choose a facility and a proposed bill at the Capitol would add some transparency to explain who’s actually paying for those services. Joining us now is Mike Pochowski, CEO of the Wisconsin Assisted Living Association, the trade group that represents those facilities. And thanks for your time today.

Mike Pochowski:
Thank you for having me.

Zac Schultz:
So let’s start by explaining what is a referral agency and how do they interact between families and the facilities themselves.

Mike Pochowski:
Sure, there’s essentially two types of referral agencies. You have the local ones that are specifically geared towards Wisconsin, and you also have the national ones. And so they really work with the families to try and find placement for those individuals, but they contract with assisted living facilities specifically. So they don’t give you a full picture of who you could potentially move into, because they only give you referrals for those facilities that they contract with.

Zac Schultz:
So part of this bill talks about making it obvious who pays, because the referral agencies claim there was no fee for the families. They get paid on the back end. But there’s concerns that those fees are passed along.

Mike Pochowski:
Absolutely. So what happens is they advertise themselves as being this free service to individuals and to families. It’s not a free service. The fees are paid by the facilities that they contract with. And so what happens, unfortunately, is that because those fees are very high, they get passed down to the consumer or to the residents that live in those facilities.

Zac Schultz:
So the incentive for referral agencies to send clients to more expensive facilities, at least that’s what the trade groups feel is happening for some of these agencies.

Mike Pochowski:
Correct. For the most part, these referral agencies charge anywhere between 85% to 100% of the residents first month rent and care. And so what happens is that gives them the incentive to move individuals into higher priced facilities, because they can get a higher fee with that. The problem with that, too, is that what happens is for these individuals, they spend down their assets more quickly, making them Medicaid eligible faster. And so we already have a Medicaid system that’s already having lots of problems. So it just enhances the problem with our Medicaid program.

Zac Schultz:
So what would this bill do? What’s the number one takeaway that this would accomplish?

Mike Pochowski:
It provides greater consumer transparency. It lets everyone know that there’s contracts between the facilities and the referral agencies. That the facilities are paying a high fee for these referrals. And it just lets the consumer know that there’s also other avenues they can go to try and find placements versus working with just a referral agency, who is only going to steer you towards a facility that they contract with.

Zac Schultz:
So referral agencies advertise their services, almost doing the homework for the seniors or the families but what kind of homework should a family do before going through a referral agency?

Mike Pochowski:
Sure, absolutely. They can contact their local ADRC, which has a full list of all the facilities that are in that geographical area for that resident or family, or they can contact the facility directly. Just kind of say, “You know, what services do you provide? What’s the environment? Can I come and tour, talk with the residents, talk with the staff?” Just go that route directly.

Zac Schultz:
Now, you said there were national and local groups, and often we find those disparities. Locals are more local. Do they do a better job in your estimation?

Mike Pochowski:
In our part, there’s probably pros and cons to both. I think the nationals, you’re right, is probably more just geared towards from a national perspective. They can’t focus just on one state. For the ones that are more state based, they probably have more information and more resources from a state based or a local based resource.

Zac Schultz:
So the industry overall is facing a shortage of beds, shortage of workers, low pay. What are the steps involved with handling this new influx of patients because obviously this is, this is just transparency. If it passes, it’s not fixing any of the other bigger problems.

Mike Pochowski:
Right. Exactly. You’re absolutely correct. So we, right now, we have a state budget that’s being worked on right now. We’re asking for, you know, continuation of funds in the family care or the Medicaid waiver program. So we need to get more funds into that program to help pay for workers, pay for the increasing cost of goods and services and everything else that’s going on.

Zac Schultz:
So for families that aren’t connected directly in the same state or the same town as their loved ones that need this care, what would you recommend them to do? You said you can reach out, but that’s time consuming. That’s why these agencies popped up in the first place.

Mike Pochowski:
Absolutely. I would still say, you know, contact your local ADRC. They’re very helpful. They’re a great resource. And just look on the internet, find facilities that are in the area that you want to move into and look at those directly and contact them directly.

Zac Schultz:
So we have a little bit less than a minute left. Obviously, there’s national implications for Medicaid funding. How does that play into some of these concerns?

Mike Pochowski:
We’re very concerned if there’s going to be national cuts into the Medicaid program, because that would trickle down to the states. We already have a state budget that’s looking to potentially cut Medicaid funds as well. So we’re definitely doing our best to kind of push for at least continuation of funds. But yeah, we’re hearing of cuts all across the board. That’s significant concerns for the long-term care industry.

Zac Schultz:
All right. Mike Pochowski, CEO of the Wisconsin Assisted Living Association, thanks for your time.

Mike Pochowski:
Thank you very much.