Study: Butler County should consider leasing Care Facility

Care Facility facing possible $365,000 funding loss

The Butler County Care Facility’s Strengths and Weaknesses


  • Person-centered care
  • Good behavior programming & interventions
  • High staff retention rate
  • Relationships with Sojourner, Transitional Living & Mental Health Board


  • Low Star rating
  • High average age of the facility
  • High Medicaid concentration
  • High concentration of non-typical nursing home patients
  • Not conducive to profitable payers
  • Lower than average reimbursement rates
  • High benefits costs

Source: Plante Moran

Facing another possible $365,000 Medicaid cut, the administrator of the Butler County Care Facility is recommending county commissioners consider leasing the facility to a private enterprise.

The county commissioners spent $9,500 on a study to determine whether the county should be in the nursing home business at all. One of the suggestions in the study was to lease the facility, but Administrator Chuck Demidovich said he made that recommendation to the county administrator a week before the study came in.

“The recommendation I made to Charlie (Young) a week ago, because I’m very frustrated, is to get a management company in and lease it out,” he said. “The problem is there is nobody else in this community that’s going to take some of these folks. The single — I call them mom-and-pop operations — owner of a nursing home isn’t going to survive in this market, because I don’t have the resources of a corporate.”

The 109-bed Butler County Care Facility is one of 33 county-run nursing homes left in Ohio. The nursing homes were mandated in all 88 counties when the first facility was built in 1830 to serve the sick, poor and homeless. Many of the facilities closed after the state legislature lifted the mandate, and counties opted to let the private sector handle nursing care as government budgets shrank.

But Butler County has maintained its county-run nursing home despite its financial challenges in recent years. The care facility has had to borrow $1.1 million from the commissioners since 2013 to fill gaps in the $7.4 million budget, largely because of the shifting rules and funding levels of Medicaid reimbursement.

The study, that was done by Plante Moran, projected a $365,000 reduction in Medicaid funding beginning in July, which is bad news.

“Since Medicaid payers make up 93 percent of the payer mix, the reduction in the projected Medicaid rate to approximately $176 per day will force the facility to reduce expenses to maintain a financially viable facility,” the report reads.

This is the second time the home has taken a hit, it lost $600,000 after Gov. John Kasich took office. Kasich's 2011 budget erased $20.06 per day from the Butler County Care Facility's Medicaid rate, bringing it down to $173.43. The per patient daily rate at the care facility is $205, which doesn't include extras such as therapy. The current rate is $185, which is down from the $187 the home was getting before the state recalculated.

“The multiplier dropped because of the type of patients we take. We don’t get paid as much because supposedly under their system, they don’t require as much services. Behaviors require lots of services,” Demidovich said. “We’re not your normal nursing home so we don’t fit that mold.”

Sam Rossi, director of communications for the Ohio Department of Medicaid, said the state is undergoing a mandated “rebasing” of rates, which is done every 10 years. The new rates will be based on 2014 rates rather than 2003. He said acuity or sharpness of the residents in the facility is a big factor in the rate restructuring, which will ultimately result in an additional, estimated $150 million statewide.

“Patient acuity is often the biggest factor as to whether an individual facility sees an increase or decrease in payment,” Rossi said. “If a facility’s residents have typically lower acuity in 2014 than they were in 2003, there may be a decrease in payment in order to better align with the level of care that is being administered.”

Demidovich has $500,000 remaining on his bill with the county and he had intended on erasing the debt over the next two years. He said first he has to figure out how to cut $365,000 out of his budget, then he’ll have to readjust his repayment plan. To combat the shrinking reimbursement dollars he laid of 10 administrative staff in 2014.

The study also compared the care facility to other nursing homes in the county, using the Centers for Medicare Five Star Rating tool. On a scale of one to five, with a five being the best, there were six homes that received the five star rating, four got the next highest rating, five received a three rating, five were given a two and three, including the Care Facility only managed a one.

The rating was based on scores for health inspections, staffing and quality measures. But Plante Moran also did its own evaluation, taking many factors into consideration and gave the home a 2.6 on a scale of five. One of the top goals of a nursing home is high occupancy — there were 102 beds filled this week — and the county home with 91 percent occupancy or 99 patients in 2014, tops the county-wide and state rates of 86 and 85 respectively. The study also acknowledged it difficult to get an accurate read on resident satisfaction from patients who have behavioral issues and drug and alcohol addictions — like many residents of the home.

Demidovich said he got dinged on the health inspection because inspectors found flies and gnats in the building. He said in hindsight he probably should have challenged that and if he had the home would have gotten a three instead of a two, which the study writers said he should strive for.

“We got one cite (citation) and I didn’t fight it because I thought how stupid,” Demidovich said. “It was a ‘F’ and it was for flies and gnats in the building, in the middle of August. Does your house not have flies in the middle of August? And watch how much that front door opens.”

The study also pointed out strengths, weaknesses, opportunities and threats to the Care Facility. The strengths included the fact they have a high staff retention rate — a good number have been there 25-plus years — they offer person-centered care, and they have good behavior programming.

Weaknesses were the high reliance on Medicaid and the building’s age to name a few. The study also said the home is threatened by “Ohio’s push to place patients with behavioral issues back into the community.” One of the opportunities listed was partnering with other agencies to provide behavioral health services.

The opportunities included selling the facility or leasing as Demidovich suggested. The county administrator said they are trying to absorb everything the study touched on, which he said accurately showcased all the tough challenges the home faces. So right now there aren’t options that won’t be considered.

“I don’t think anything is off the table. We haven’t had this report long enough to really work out what our next steps will be,” Young said. “But I wouldn’t take anything off the table for future actions.”

This first phase involved determining if the facility has value in the community. The study writers said the home does have value in that it cares for those individuals who other nursing facilities shun; the need for these particular services will continue to grow and it helps keep hospital costs down.

The study addressed the many challenges and offered ideas but didn't specifically say if the county should continue to run it. If the commissioners decide to keep it, there is a second phase of the study, with a price tag of $13,000 to $15,000 for strategic planning.

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