Those who know me, know that for several years as the Albany County, NY Commissioner of Management & Budget, I developed and pushed very hard for a strategy to expand home and community based long-term care services and to close the Albany County Nursing Home. I thought and still think that this direction made much more sense for those needing some form of public long-term care support and it made vastly more sense financially and for taxpayers. The County Executive, Michael Breslin became a strong advocate of this strategy.
We won the first phase, expanding home and community based services, though not without a fight with the County Legislature. There were a number of elements to this phase, among them an expansion of Expanded In-Home Services for the Elderly Program (EISEP) services beyond what was required to achieve State matching funds and the creation of a crisis case management program.
We had a partial victory in the second phase when the “Berger Commission” required that the County close the smaller and older of its two nursing homes (the Ann Lee Home), which was not much more than a glorified adult home. It had the lowest case mix intensity of all nursing homes in New York. Moreover, the Berger Commission” required that the remaining Albany County Nursing Home downsize to no more than 250 beds. So the net reduction in nursing home beds, from 595 beds to 250, was 345.
But after that the fight was bitter and we lost. The County Legislature, in response to a half-dozen patient family members (oddly enough, led by a couple of Tea Party activists who hate government programs and spending except for their own) and unions representing the Nursing Home staff (about a third of whom live outside the County), repeatedly increased the County Budget enabling it to survive.
And here’s where it gets really interesting. The remaining building, built around 1972, is tired, and expensive to maintain and operate. So the Albany County Legislature pushed ahead to build a new nursing home. Their design is an expensive one and their own architects and consultants cost it out at about $82 million. Those same architects and consultants also estimated that the most the County could expect to recover in capital reimbursement would be about $58 million. Thus, the County will have to absorb a direct expense for the capital alone of about $24 million (amortized, I’m sure).
That increased capital expense is on top of an operating loss approaching $20 million per year. This is the direct cost to the County over and above Medicaid, Medicare, VA and private patient, and other third-party reimbursement. The administrator of one local not-for-profit nursing home of comparable size was rightly offended that the County loses a figure close to the private facility’s entire budget.
And this is for about 240 patients per year and a maximum of 250 patients at any given time.
And now it gets even more interesting …
There are several Legislators (who knows, it may be a majority), who are counting on New York State to turn down the County’s Certificate of Need (CON) application to build a new facility. There are good arguments for the State to do so and we’ll return to that later. But what these Legislators don’t understand is that such a State decision would not take them off the hook. It would force them into a deeper mess. How?
A New York State decision not to allow Albany County to build a new nursing home is not the same as the State requiring the County to close its existing facility. That decision would remain with the County … while it continued to operate a tired, unattractive, increasingly expensive to maintain physical plant.
And an Albany County Legislative decision to close down will be much harder politically today than it might have been before because they have already invested so much politically, substantively, and financially in maintaining the fiction that it’s essential. They’ve trapped themselves.
In the meantime, other New York Counties are rushing to get out of the nursing home business, but it’s getting harder and harder to sell because the long-term financial prospects for any nursing home are dimming. Suffolk County had a buyer for its facility, but the buyer backed out after legislative delays and after changes in State Medicaid policy which portend a financially dismal future.
The Orange County budget was just released and the property tax increase was less than the tax cap of two percent. How was that possible with everything else going on? What made it possible was the proposed closure or sale of the county nursing home. At least in this case, the legislative leadership, however regretfully, has recognized reality and agreed with the County Executive. Franklin County has agreed to turn over its nursing home to the local hospital and to pay the hospital to take it off its hands.
At a time when county officials in New York are complaining bitterly about “State mandates,” many have at least recognized that one of their most expensive services, nursing homes, is not mandated. Indeed the State would quietly prefer that they get out of the business.
Albany County is an exception to that and the reason is a failure of legislative leadership. Those needing long-term care services will pay and Albany County taxpayers will pay for decades.
{ Comments on this entry are closed }