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Cash-strapped Pennsylvania nursing homes are increasingly on edge

Stephanie Strasburg | Tribune-Review
Ethel Fontana, 83, of Shaler, laughs in a chair at Kane Regional Center in Ross on Wednesday, November 21, 2012. Fontana has been in care at the nursing home for four years. The nursing home, which is being affected by county budget cuts, provides an option for people who need the more intensive care of a nursing home but cannot afford the cost of a private facility.

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By Bill Vidonic
Thursday, Nov. 22, 2012, 11:38 p.m.

Beaver County closed a portion of its Friendship Ridge personal care home this summer to cut costs.

Butler County is warning that it could have to raise taxes to plug a projected $1.5 million deficit in 2013.

Allegheny County is projecting a $4.5 million shortfall for its Kane Regional Centers in 2013, which the county must plug with its own money.

Across the state, counties that still own nursing homes are saying that declining medical assistance payments have cut into revenue, while costs, including pay and benefits for employees, continue to rise, requiring them to make tough choices on whether to cut back service or find new sources of money.

Allegheny County Executive Rich Fitzgerald said on Wednesday that the county often hears from parties interested in purchasing the assets of the Kane Regional Centers, which has an average daily population of just over 1,000 patients. It estimates its 2013 budget at nearly $101 million.

“I don't think I have a desire to do that,” Fitzgerald said about selling the Kanes in Ross, Scott, Glen Hazel and McKeesport.

“I think it's important for us to maintain that service for people who need that, the poorest among our citizens,” Fitzgerald said.

Margaret Witherel said her husband, Murven, 91, receives just as good care at Kane Regional Center in Ross, as he would in a privately owned facility.

“I trust the people here,” Margaret Witherel, 90, of Ross said on Wednesday.

At one point, 50 counties operated nursing homes. Now, said Michael J. Wilt, executive director of the Pennsylvania Association of County Affiliated Homes, 29 counties run a total of 33 nursing homes.

“It's not just county nursing homes; most nursing homes are struggling. It's simply because the state has failed to keep up the reimbursements with the expenses,” he said.

Some counties have decided the financial strain was just too much. Cambria County in 2010 sold its 370-bed nursing home in Ebensburg, Laurel Crest, to private company Grane HealthCare.

In the same year, Lackawanna and Carbon counties sold their facilities to private operators, saying the nursing homes carried too much debt for the counties.

Beaver County will put aside nearly $2.5 million from the general fund to help with any shortfalls, said Vince LaValle, Beaver County's finance administrator.

“Because of the cuts from federal and state sources, when there are cuts in Medicaid reimbursements, we have to fund expenses that aren't going down,” said Vince LaValle, Beaver County's finance administrator.

Westmoreland Manor administrator Maggie Harper said the 500-bed facility has not run a deficit for more than 15 years, despite flat Medicare funding and decreasing Medicaid reimbursements. The home, which is county-owned, is privately managed by Complete Health Care Resources.

Tim Kimmel, administrator for the Washington County Health Center, said the nursing home's cash reserves will make up a $1 million deficit this year, but in 2013, the home is expecting to lose another $300,000. About 80 percent of the patients in the 288-bed facility receive some type of medical assistance.

“In my opinion, medical assistance residents are not attractive for private, for-profit facilities,” Kimmel said. “We're here to serve our residents, not to make money, and I think that's one advantage county-run facilities have. Where would these people go? That's the concern.”

Butler County project manager Bill O'Donnell said Sunnyview, the county's 220-bed nursing home, will run about a $1.5 million deficit in 2013, including a one-time bond payment, which could be offset by the first tax increase in four years. For the nursing home's $20 million budget in 2013, nearly $15 million includes salaries and benefits.

Butler officials said part of an $800,000 deficit this year was because of the county budgeting for an average of 20 Medicare recipients monthly, which offers more lucrative reimbursements, but that number has been about 15.

To make up shrinking revenues, counties are looking at expanding services that will increase revenues.

Kane administrator Dennis Biondo said officials are developing a secure unit for dementia and Alzheimer's patients at its Scott facility to generate more revenue.

“We have to find something we can do that our competitors don't do,” Kimmel said. “That's the key.”

The Associated Press contributedto this report. Bill Vidonic isa staff writer for Trib Total Media.He can be reached at 412-380-5621or

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