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Alaska Legislature

Pioneer Homes residents and their families voice outrage against proposed rate increases

  • Author: James Brooks
  • Updated: June 1, 2019
  • Published May 31, 2019

JUNEAU — The residents of Alaska’s Pioneer Homes spoke out vocally this week against a proposal by the administration of Gov. Mike Dunleavy to raise rates between 40% and 140% in the state-funded elder-care system that has existed for more than a century.

Some state grants would be available to offset the rate increases for existing residents, but in a series of public testimony sessions held Tuesday at Pioneer Homes across the state, residents, their families, and members of the public said a proposed transition away from state subsidies and toward a user-paid system is inappropriate.

“You’re ignoring your obligations as a state if you don’t support these people,” said Chuck Sassaora, who now lives in the Anchorage home.

In approximately two hours of testimony, no one spoke in support of the higher rates.

Proposed earlier this year, the administration’s plan is to take the Pioneer Homes’ three existing levels of service and split them into five tiers.

The cost of the lowest level of service, which includes housing, food, social events and emergency help, would rise from $2,588 per month to $3,623 per month.

The highest level of service, which includes 24-hour comprehensive care, would go from $6,795 per month to $15,000 per month.

“No resident will be kicked out,” said Dunleavy spokesman Matt Shuckerow on Thursday. “There are and continues to be individual assistance.”

Alaska’s system of Pioneer Homes was established in 1913 and has grown from one location in Sitka to six, including homes in Anchorage, Palmer, Juneau, Ketchikan and Fairbanks.

Since the last slump in oil prices, the state’s budget for the Pioneer Homes has been relatively flat.

Flat funding means state support for the system has failed to keep pace with rising costs, particularly health care costs. By 2017, staffing shortages caused by budget cuts were forcing the system to operate under its capacity, even though there is an extended waiting list for entry.

“Changes to the rates at the Pioneer Homes have not been made for some time,” Shuckerow said.

During his campaign for governor, Dunleavy pledged to pay a Permanent Fund dividend using the traditional formula in state law. Because Alaska lacks the annual revenue to pay that dividend and keep other state funding at existing levels, Dunleavy proposed sweeping budget cuts in order to avoid spending unsustainably large amounts from the state’s savings accounts and the Alaska Permanent fund.

In February, as part of that cost-cutting plan, the governor proposed trimming state support for the Pioneer Homes and beginning a transition toward a resident-paid approach. According to figures from the nonpartisan Legislative Finance Division, the governor’s February budget included a $12.3 million cut to state funding for the Pioneer Homes. Some of that cut would be offset by requiring residents to pay more.

On Tuesday, some testifiers said they would rather pay a state tax than pass costs to Pioneer Home residents.

“It’s unconscionable that this is even a discussion … that we would consider kicking our elders out of their housing before we even consider a tax on ourselves makes us unworthy of the title The Great Land,” said the Rev. Matthew Schultz of Anchorage’s First Presbyterian Church.

Legislators have rejected some of the governor’s proposed cut; the House-Senate compromise proposal under consideration now includes a $7.5 million reduction in state support, according to the finance division, but shifts $2.4 million in marijuana tax revenue to cover part of the gap, then allows the Pioneer Homes to collect up to $10 million from higher fees.

But on Tuesday, residents said those higher fees are more likely to drive people away. One woman said she and her husband were co-presidents of the residents’ council at the Anchorage Pioneer Home but have since moved out because of the prospect of higher fees.

She has been diagnosed with Crohn’s disease, which is inflamed by stress.

“We came to a decision that we couldn’t tolerate the level of stress that was going to be going on here regardless of what the outcome was. So we’ve moved out,” she said.

Another Anchorage Pioneer Home resident said she and her husband are looking at their savings and dreading what will come next.

“My husband and I, we are private payers and I manage our budget, so I’m very aware of what our future looks like, and I can tell you the idea of $13,000 a month is not a happy thing to look at,” she said.

The administration’s proposal is to expand payment assistance programs for residents who cannot afford the rate hikes, but the extent of that help is not yet known. As Carol Fox of Fairbanks said during public testimony, “Some of us don’t want to have to apply for state assistance.”

An alternative approach is being proposed by a coalition of independents, Republicans and Democrats in the House. House Bill 96, which passed the House 35-4 earlier this year and is awaiting consideration in the Senate next year, would limit any increases in Pioneer Home rates to the rate of inflation.

Additional hikes would require legislative approval — the department wouldn’t be able to increase them on its own.

The public can comment on the state’s proposal by emailing before 5 p.m. June 28. Questions about the proposal can be answered by emailing before June 18.

Correction: A previous version of this article incorrectly attributed a quote to former state legislator Chuck Sassara. The quote should have been attributed to Pioneer Home resident Chuck Sassaora.