Medicaid Patients Ousted From Nursing Homes : Health care: A change in federal law has resulted in the displacement of many elderly people. Facilities are being forced to change the makeup of their clientele.

Ellen Wolcott was 80 and had been on Medicaid one month when her posh nursing home told her it couldn’t afford her any longer.

Wolcott, mute since she suffered a stroke, was so frightened of having to leave the familiar surroundings at Knollwood Terrace that she began vomiting and had to be hospitalized.

Knollwood in February became the first nursing home in the nation to oust Medicaid patients because of a change in federal law.

“What happened to our families is not an isolated thing. It’s going to continue to happen all over the country,” said Wolcott’s daughter, Nancy Gattone. “Our elderly Medicaid patients are being shuffled about like old shoes. It may be legal, but it’s absolutely immoral.”

Of the 62 patients who need a new place to live, most are middle-class people who went broke paying for nursing home care before they got on Medicaid. They have until April 30 to find new homes.

“There a Medicaid crisis now in every state,” said Dina Elani of the American Assn. of Homes for the Aging. “Most homes are losing money.”

Nationwide, financially pinched states are lowering Medicaid reimbursements. An AAHA survey found that 15 states are being sued over the rates; 35 others are taxing health-care providers to supplement Medicaid revenues.

Illinois ran out of Medicaid money last summer and couldn’t pay hospitals and nursing homes for eight months. Last month, the state borrowed $500 million to pay the bills, but about $350 million still is owed.

In Georgia, 20 nursing homes have gone bankrupt in 18 months and more than 200 are losing money because of Medicaid cuts, said Fred Watson, president of the Nursing Home Assn.

Knollwood was the first to tell its Medicaid patients to go, a decision administrator Keith Hart said was forced by a 1990 change in Medicaid law. It required homes that cared for seriously ill patients also to accept moderately ill ones.

The state reacted by lowering Medicaid payments to homes based on their number of moderately ill patients. The reason: Caring for the latter should cost less.

Not so, said Patricia Nemore, staff attorney for the National Senior Citizens Law Center in Washington.

“The two distinctions are really not very meaningful in terms of nursing home people, because their condition changes,” she said. “They might need more service one day and less a week later, when they’re a little more stable.”

For Knollwood, Medicaid reimbursements fell from $98.04 a day to $62.74. Private patients pay $80 to $130 a day.

Nursing homes in Georgia have to agree, before they open, to participate in Medicaid, but state law doesn’t force them to stay in the program.

Angry Knollwood families pushed legislation in February to close that loophole. Modeled after Tennessee’s Medicaid program, the legislation would force facilities that withdraw from Medicaid to continue to care for needy patients already living there. The bill has passed the Legislature and is awaiting the governor’s signature.

But the legislation won’t help the 62 Knollwood residents find homes by the April 30 deadline.

Gattone had to enroll her mother in a personal-care home, which does not provide medical care and isn’t eligible for Medicaid. Gattone doesn’t know how she’ll pay the $1,800-a-month bill, or what will happen if her mother’s condition worsens. Personal-care homes accept only patients who don’t need around-the-clock care.

Ginger Hall fears that if she can find a new home for her mother, she won’t survive the move. Martha Ferrell, 75, suffers from Alzheimer’s and Parkinson’s diseases and is fed through a tube.

“A psychologist told us that 50% of these patients would not be living in three months, because of the trauma of the move. And the homes we’re looking at have told us they don’t know if they can stay in Medicaid another year, either,” Hall said. “I just don’t know what we’re going to do.”