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Why they're selling

  • FILE PHOTO/TIMES NEWS Schuylkill County is selling its nursing home, Rest Haven, because costs continue to rise as funds drop.
    FILE PHOTO/TIMES NEWS Schuylkill County is selling its nursing home, Rest Haven, because costs continue to rise as funds drop.
Published August 21. 2014 04:00PM

Schuylkill County has tried its best to keep its nursing home, Rest Haven. But as costs continue to rise and revenues to fall, the county has finally decided to seek a buyer.

It was not a quick or impulsive decision.

Commissioners Chairman Frank J. Staudenmeier, first elected in 2002, has watched as most of the state's 67 county's divested their nursing homes.

"We put it off as long as we possibly could," he said. "I don't know how we did it. Obviously we have good employees who are cost conscious."

The home, with 140 residents, employs 113 full-time and 130 part-time workers.

On Wednesday, Mark Stewart of Eckert Seamans Cherin & Mellott of Harrisburg, the firm commissioners hired for $250,00 to seek a buyer, on Wednesday walked county officials through the reasons to sell.

County nursing homes, he said, are heavily dependent on government payment programs. But Pennsylvania has changed those programs in ways that aren't good for county facilities.

Stewart said about 65 percent of patient days in nursing homes in the state are reimbursed by Medicaid, the federal health care program for low-income people.

Rest Haven is at 84 percent.

Most county nursing homes operate with a deficit due to expense/revenue gaps.

Between 2008 and 2013, Rest Haven's operating expenses increased by 16 percent, from $10.7 million to $12.5 million. Meanwhile, its revenue grew by 1 percent.

"Since 2008, Rest Haven's net equity position has deteriorated to $4.6 million in the red," Stewart said.

Since 2011, the county has contributed more than $2 million in loans and allocations from the general fund.

The revenue picture is not going to get any brighter, and costs will continue to rise, Stewart said.

He pointed out that private nursing homes in the county realize greater revenues, including St. Luke's Healthcare Network in Coaldale, which outpaced Rest Haven by $2.1 million, and Hometown Nursing and Rehabilitation Center which was ahead by $1.09 million.

Selling is the best solution, he said.

A private operator would focus only on running a successful nursing home, commissioners could set clear policy goals to guide the sale, and insure those goals are met.

Among those policy goals are that Rest Haven continues to be a long-term nursing facility that provides for indigent residents.

Employees' jobs would be preserved, they would have more opportunities for advancement and expanded financial opportunities. The new owner would give current employees first crack at jobs, and "facilitate a fair and equitable transition to the private sector."

Taxpayers would reap benefits, too.

Selling would provide a possible solution to the $4.7 million in unfunded retirement health benefits, and the property would be put back on the tax rolls, potentially generating more than $133,000 in county, local and state funds.

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