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Michigan Veterans Homes reports improved ratings, construction plans and Medicaid role in reducing general‑fund costs
Summary
Director Anne Zerbe told the Senate appropriations subcommittee Michigan Veterans Homes increased federal revenues, achieved five‑star CMS ratings across homes, and is moving forward on replacement construction at Jacobetti and a new Marquette Township site while noting construction cost pressures and ongoing staffing challenges.
Anne Zerbe, director of Michigan Veterans Homes, told the Senate Appropriations Subcommittee on Military, Veterans and State Police that federal revenue and Medicaid certification have reduced the state general‑fund burden for veteran skilled‑nursing care and allowed the agency to maintain operations without additional appropriations for the coming year.
"We provide a tailored environment specifically for veterans, providing those veterans with skilled nursing care," Zerbe said, summarizing the homes' mission. She said the agency is operating more efficiently after organizational reviews and that labor costs — salaries, fringes and contracted nursing — account for roughly 90% of the homes' total budget.
Zerbe gave several operational figures: the Grand Rapids home serves 28 veterans, the Chesterfield Township home also serves 28, and the system reported 455 unique members served with 68 new admissions in the last year. She said federal revenues tied to Medicaid and Medicare have risen, with Department of Health and Human Services funding increasing from about $4,000,000 to roughly $9,200,000 since 2021.
Zerbe described how Medicaid certification reduced state general‑fund costs for veterans who cannot privately pay. Using a scenario she presented, a veteran with a $508 daily cost of care and no private pay would produce a general‑fund cost of about $363 per day absent Medicaid; when Medicaid applies, that general‑fund cost falls and can save tens of thousands per veteran annually.
On construction and capital projects, Zerbe said a replacement for the Jacobetti home (originally built in 1954) is advancing: the state provided a FY22 state match of $34,200,000 and the VA grant award under discussion is about $63,400,000. The agency has purchased property in Marquette Township and said it plans to start construction in May, subject to final VA grant paperwork and the secretary's signature.
Zerbe told senators that, unlike some other agencies, the veterans homes "specifically are not seeing impacts" from the federal grant holds cited elsewhere at the hearing; she said the VA clarified that per‑diem and construction programs for the homes would not be affected and that VA survey activity has resumed. She did note that bids for current projects came in higher than anticipated and that Buy American/Buy America compliance and post‑COVID escalation have increased construction costs.
Senators congratulated the agency on CMS five‑star ratings and high statewide rankings (Grand Rapids and Chesterfield tied at 11th of 421 nursing homes; Jacobetti ranked 13th), and thanked staff for the homes' operational turnaround since earlier audits. Zerbe said recruiting and high medication costs for certain specialty drugs remain operational challenges.
