County Nursing Home Adding Services to Fight Medicaid Funding Loss

| April 17, 2013

Funding cuts have turned county-run nursing homes in many states into an endangered species in the past couple of years resulting in multiple facility closures, but one county is taking several steps to keep its nursing home open and, eventually, profitable. 

Pennsylvania counties have been steadily selling off or closing their nursing homes, according to the Pennsylvania Association of County Affiliated Homes, and only 33 county owned and operated facilities remain in 28 counties, says a recent PennLive article

“Some counties decided a county nursing home is very much a part of their mission. Even if it operates at a deficit, they think that’s a good use of county taxpayer dollars,” Mike Wilt, the association’s director, told PennLive. “Other counties feel differently about it, and after many years of losses, they decide it’s time to sell.”

Cumberland County, which runs the Claremont Nursing and Rehabilitation Center in Carlisle, Pa., is hoping to avoid the need to sell the facility by expanding its service offerings, reports PennLive.

The county commissioners have already negotiated a new union contract that includes nursing home employee concessions amounting to $800,000 in a bid to keep the facility open, but that won’t be enough.

A combination of rising operational expenses and flat Medicaid reimbursements, which account for 80% of the nursing home’s income, have hit Claremont hard—especially in the last two years, says PennLive. 

“Years of Medicaid shortfalls coupled with recent and severe Medicare cuts have forced many of our state’s skilled nursing centers to reduce staff, freeze wages or reduce benefits, delay renovations, and delay purchases that could enhance care,” Alison Everett, spokeswoman for the Pennsylvania Health Care Association, told PennLive. “These funding cuts are causing the safety net to come apart at the seams.”

Claremont’s reserves were tapped extensively in 2011 and 2012, standing now at about $2.7 million down from nearly $5 million. In order to staunch the losses, says the nursing home’s administrator, Karen DeWoody, Claremont will expand its operations to generate more revenue.

This will include converting a former on-site daycare into a skilled rehabilitation unit, reports PennLive, that can serve both short-term patients and long-term residents in need of acute care. 

While the new rehab facility will cost an estimated $1.7 million, funded by the nursing home’s reserves, it will bring in Medicare dollars along with managed care money, according to the PennLive article. Once those funds are being produced, the county will then launch a second phase that includes more upgrades and care offerings. 

The county’s contract with the union also included an agreement to not sell the nursing home during the contract’s term, which expires in December 2015. 

Read more at PennLive.

Written by Alyssa Gerace


Category: Management & Operations, Medicare and Medicaid, Nursing Homes, Senior Care, Senior Housing

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  1. kathy says:

    Wonder if these nursing homes that are planning rehab units to provide revenue are watching Obamacare because Medicare is looking to be cut and that is one of the areas – rehab.