Indiana Health Care Association Sounds Alarm On Nursing Home Closures

 Indianapolis -- Indiana’s dramatic rise in nursing home closures could be a warning sign to the nation’s long-term health care providers, according to the Indiana Health Care Association.  So far, 10 nursing homes have either closed their doors or announced their impending shut down in 2001, compared with 11 closings statewide all of last year.  

Indiana’s most recent closings include two nursing homes in Indianapolis, one that served AIDS patients and another that served an all-minority population. A Bloomington, Indiana nursing home that was run by the local hospital is closing, citing changes in federal and state funding as the reason.  

“Every state has either seen this crisis full-bore, or will in the near future,” warns Mike Weber, chairman of the Indiana Health Care Association and an owner of 2 nursing homes. “We believe that Medicaid and Medicare funding and reimbursements are falling critically short of meeting the ever-expanding needs of seniors.”

Closures seem to be more pervasive in states such as Indiana, Michigan and Minnesota, where reimbursement rates are lower than average. Indiana’s average Medicaid daily reimbursement rate is $94 per Medicaid patient, meaning the care of most Medicaid patients is subsidized by private-pay patients at about $5 each day, per patient.  

Rodney McBride, vice president for long-term care for the Bloomington Hospital, which just announced the impending closure of one of its four nonprofit nursing homes, admits he’s worried about the future for nursing homes in Indiana.  

“I think it’s an issue for everybody in Indiana,” McBride said. “We need to make a decision on how we’re going to care for the elderly in the future. It’s a societal question.”  

Low Medicaid and Medicare reimbursements and staff shortages caused one of Bloomington Hospital’s homes, the Bloomington Convalescent Center, to announce that it will close its doors this year. Bloomington Convalescent Center has 102 patients who will be transferred to other facilities over the next few months. The center, built in 1972, has been operated by the hospital for all of its 28 years.  

“It is critical that both Medicare and Medicaid funding keeps up with patient needs,” said Charles H. Roadman, II, M.D., President and CEO of the American Health Care Association.  “Congress and state governments must recognize that if they continue to shortchange our seniors, this rash of closings in Indiana will be just the beginning. Millions of aging Baby Boomers will begin needing long term care within the next 10 years -- our nation simply cannot afford these closings.”  

McBride, who served as the center’s administrator for nine years, said it was always a struggle to make ends meet because reimbursement didn’t appropriately cover care for the nursing home’s population who have more severe health problems and require more attention and assistance than the residents of other nursing homes. Recently, changes to Medicare funding and a new state reform case mix system that didn’t live up to its billing compounded the center’s problems, he said.  

Summer Brook Healthcare Center, a 41-patient facility in Indianapolis, closed its doors in March, after losing about $10,000 a month for several years.  

Even though the center had paid off its mortgage, owner and administrator Leonard Scott placed a new mortgage on the aging building to help supplement monthly operating costs. All but one Summer Brook patient was on Medicaid.  

“We tried to sell,” said Scott. “What we found was many of the companies that had facilities our size had already sold them. There is no market for a 40-bed facility. Everybody knows you can’t make it.”  

The Indiana State Legislature is considering a bill that would assess each nursing home $5/bed.  This assessment would allow the state to recoup some federal matching funds that would bring enough dollars to the nursing homes to cover what providers paid and provide for more Medicaid reimbursement to hire workers, improve Alzheimer’s disease training, pay skyrocketing liability insurance and repair aging buildings