Changes at Lakeland may pinch private nursing homes
If the county-run Lakeland Health Care Center continues to accept more private pay residents, as county officials say is necessary to ease the facility’s tax burden, then it could put the squeeze on independently operated nursing homes, industry officials say.
As the county accepts more people who can pay out-of-pocket, fewer of those people will choose private nursing homes, said Terry Dignan, vice president of the Kiwanis Manor Board of Directors.
The new 120-bed Lakeland facility, which opened last summer, will look to have 27 private-pay beds in 2008 and 31 private-pay beds in future years, county officials said. Those beds would be for short-term patients fully funded by Medicare or people who could afford to pay out-of-pocket.
That means fewer beds for the county’s indigent or those who need Medicaid.
The move is intended to control the facility’s burden on the tax levy, officials said. Because Medicaid does not cover the expense of long-term, indigent residents, the county has to subsidize those patients with property taxes.
But if the county accepts fewer of those patients, they’ll look to private homes, which aren’t backed by the taxpayers.
“It will have a huge impact on us,” said Dawn Willert, administrator of the Kiwanis Manor in East Troy. “When more of their Medicaid beds open up and become private pay and Medicare beds, it will take away the small amount (of private-pay patients) that we depend on here at the Manor.”
To stay afloat, private homes rely on a mix of private-pay and Medicaid residents, Dignan said. Kiwanis Manor will take just about anybody who comes through the door, but the Manor needs a mix to remain in operation.
The same is true for Walworth County’s facility, County Administrator David Bretl said.
When the board debated downsizing the nursing home, it had a number of private-pay beds in its business plan, Bretl said.
“Taxpayers are subsidizing to the tune of $3.5 million to take on public assistance (Medicaid) patients,” Bretl said. “If a decision is made that it becomes strictly a home for the indigent, I don’t think we’re financially viable.”
The county always likely will have more indigent residents than private-pay residents, Bretl said. It was built on the premise of being a safety net for those who can’t afford other facilities.
The larger issue really should be finding more state or federal dollars to make Medicaid reimbursements adequate for all facilities, Bretl said.
Dignan said reducing the number of county beds available for indigent residents brings the home closer to competing with private homes. He suggested the county get out of the business all together.
“In order to ease the burden on the taxpayer, they need to sell the facility, just like they did the Lakeland Hospital, and allow private ownership to operate the building for the benefit of the residents and not just the benefit of the administrative staff and the rest of the staff,” Dignan said.
He feels there would be enough competition among the private homes to have enough spaces for indigent residents using Medicaid. The move also would save taxpayer dollars, he added.
“As they get to 89 (Medicaid beds) with a cost-cutting county board, what’s to stop them from getting it to 69, or 49 or zero?” Dignan said. “A privately owned facility is going to have to staff in a manner that is going to allow for revenue to match the expense.
“We can compete with other privately owned nursing homes in the county. We cannot compete with a nursing home that gets a $3.5 million taxpayer subsidy per year.”