Report: Vast Financial Trouble For County-Owned New York Nursing Homes

The nursing home options for New York seniors is changing rapidly. In the past, many facilities were owned publicly, usually by local counties. Elder care advocates often praise these models, because there are concerns about how the profit-motive of private homes affects overall care. Studies have shown that non-profit homes have better overall caregiving records with fewer deficiency citations.

However, finding available beds in a non-profit nursing home is becoming increasingly difficult in New York.

Shift to Private Homes
A new report from the Center for Governmental Research in Rochester suggests that county-owned facilities are on the way out. As discussed in a McKnights’s story, more than nine out of every ten county facilities were in the red in 2010–losing money. Not only that, but the average budget deficit at these long-term care facilities has nearly quadrupled over less than a decade.

The study authors point out that some facilities are spending $100 more per day per resident than they receive for that resident via Medicaid reimbursements. But Medicaid shortfalls cannot bear all of the blame. Relatively expansive employee benefits at these facilities are also a huge expense for public homes.

All told, this year at least eight more New York counties were actively selling the facilities. Another five homes were being shopped around to private investors.

With virtually every home struggling to remain a financially viable enterprise, there is a good chance that these non-profit homes will slowly disappear altogether in New York. However, the authors of this most recent study point out that public facility extinction is not the only option. To fix the problem, the authors provide some policy suggestions. Those recommendations include providing homes with supplemental funding from the state.

Alternatively, the state could provide supplemental funding to private homes in the hopes of curbing the decline in care quality. In addition, if a private sale is warranted, advocates point out that county boards need to be vigilant about the sales process. There are significant quality differences between private operators, and it is critical for the transfer to take quality into account.

One advocate noted, “They just need to be very, very careful about the vetting process. At least one of the counties we look at that sold over the last five years made a pretty horrible decision and they wound up selling to a small building that wound up failing three or four years down the road,”

All of this news is another obvious reminder of the need for New Yorkers to plan as early as possible for long-term care. The earlier the preparation the more quality options that will be available.

The Full CGR Report, “The Future of Nursing Homes in New York State,” can be viewed online at no charge here:

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