County nursing home woes reach critical stage in New York, report shows

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With county nursing homes hemorrhaging money nationwide, a new report out of New York paints a stark picture of the challenges facing its county facilities, and recommends changes to keep them afloat in an increasingly challenging environment.

In 2010, 92% of the Empire State's county nursing homes located outside New York City lost money, according to the report from the Center for Governmental Research. Median losses per resident day quadrupled over the previous nine years.

County nursing homes customarily take on a higher proportion of Medicaid residents than privately operated facilities, and reimbursement rates have not kept pace with costs, the report states. The shortfall can be as much as $100 per resident day.

Employee benefit costs are an even more significant contributor to operating deficits. Median employee benefit costs per resident day increased 181% between 2000-2010, according to the report. This is due in large part to legislation and bargaining agreements that are difficult to undo or renegotiate.

As of January 2013, eight of 33 New York counties were in the process of selling and five more said they were actively considering the option, the report states. To avoid this step, the study authors offer recommendations to state leaders.

The recommendations include providing supplemental funding for county homes that meet certain criteria, such as a track record of serving high needs residents in an area with limited options. In counties where the public nursing home has already been sold to a private operator, these high-needs residents have continued to receive care, contrary to what some people feared, the report finds. However, quality of care has in some instances declined. The state could hedge against this by providing supplemental funding to private operators that take on Medicaid residents with complex needs, the report suggests.

Commenting on the plight that county homes face nationwide, LeadingAge President and CEO Larry Minnix offered some other recommendations to help these facilities stay afloat. One possible option is partnering with a nonprofit provider to “minimize infrastructure costs and provide services on an incremental cost basis,” he told McKnight's last year.

Click here to access the complete CGR report, released Tuesday.