Hillcrest turns profit for February

McCOOK, Neb. — Hillcrest Nursing Home turned a profit last month to the tune of about $45,000.

That’s good news for the facility, compared to 2012 when the county-owned nursing home had to ask the Red Willow County Commissioners for money to pay expenses. This was due to billing not being done and money not set aside for construction and bond payments. The commissioners had to secure a $1 million loan from McCook National Bank, with the final payment on that loan made by Hillcrest in September 2017.

Since then, the facility has made small strides, hiring the management team of Rural Health Development and turning a profit in August. As revenue for the facility is census-driven - meaning, the more residents it has, the better the earnings - costs and revenues can fluctuate month to month.

That was the case for January, when the census count was in the 70s for the 100-bed facility and costs outweighed income.

This changed in February, with total income for the month at $558,202 and total operating costs at $515,632. A total of 86 residents were at Hillcrest as of Tuesday.

“We need the good months to take care of the bad months,” said Ron Ross, president of Rural Health Development, the management firm hired in July by Hillcrest Board of Trustees for $14,500 per month.

In giving the board an overview of the financials at the regular board meeting Tuesday morning, Ross mentioned several factors that helped revenue, including a higher census at the facility and increased income from Medicaid/Medicare reimbursements. People coming in for short rehab stays after surgery and then leaving to go home helps with Medicare reimbursements, Ross said.

Medicaid is a state and federal health insurance program for low income and needy people. Medicare provides health insurance for Americans 65 years or older, who have worked and paid into the system.

Hillcrest is fortunate that it’s a large enough facility with Medicaid payments at only about 50 percent, Ross said. The current ratio has 43 residents on Medicaid, 39 private pay or Medicare and a few eligible for VA benefits.

It’s the smaller nursing homes that rely more on Medicaid than Medicare reimbursements that can get into trouble financially, he said. That’s because last year, the state legislature decreased Medicaid funding by 3 percent, further reducing Medicaid reimbursements that compensate facilities on what costs were two years prior.

“Then people wonder why facilities can’t pay their bills,” Ross said, since 65 percent of seniors in Nebraska are on Medicaid.

The 21 Nebraska nursing homes and assisted living facilities that were taken over by Health and Human Services on March 23 for not making payroll is the symptom of a bigger problem, Ross said. And that’s the challenge for many small nursing homes in the state that are reliant on Medicaid reimbursements.

“There’s another 20 out there just hanging on by their fingernails,” he said.

In reviewing the financials for Hillcrest, Ross cited the assisted living unit, a concern among the board last month. But things are looking good for the unit in February, Ross said, citing revenue outpacing costs, at $22,877 to $17,022. Year-to-date revenue comes in at $179,964, higher than the $145,312 predicted in the budget.

Other issues discussed by the board and Hillcrest staff included:

* Hillcrest administrator Brad Cheek, whose salary is paid by Rural Health Development and not from the Hillcrest budget, told the board that several pieces of furniture and equipment at the facility’s daycare center needs to be updated, for a total of $450-$500. The board unanimously voted to replace these items, that included two car seats, six booster seats and eight cribs. Board member Mike Skolout questioned why the need for car seats and Amanda Davidson, Hillcrest human resources, said children are transported from the daycare to school or preschool.

* staff is still gathering surveys from staff about using employer-issued health insurance. Hillcrest currently gives stipends to full-time employees to use at the Affordable Care Act’s “Marketplace” in lieu of insurance. With the survey, the staff is trying to determine if enough full-time employees would use employer-issued insurance to make it profitable and keep premiums low. Renee Wright, Hillcrest business manager, told the board that when Hillcrest used to offer insurance, it ran about $80,000 per month. Funds have been set aside for a penalty, she added, with Ross adding that the risk is less for a penalty if it’s a governmental facility. Hillcrest has 170 full-time, part-time and as-needed employees.

* the facility hired three new certified nursing assistants, one maintenance assistant and one laundry aide. Two more licensed practical nurses will be hired later in the month, with two registered nurses leaving.

* board member Mike Eklund asked about using foreign nurses. Whitney Kuhlen, director of nursing, responded that none have been hired yet but that it’s still an option. The nurses, with bachelor’s degrees or masters, come from countries like the Philippines or Mexico and range in ages from about 23 years old and up, Kuhlen said. The process would begin by Kuhlen interviewing potential nurses sent from the agency, with employment beginning after about five months due to legal paperwork. The nurses would be hired for a two- or three-year contracts and be paid the same as other registered nurses, she said.

After the regular meeting, the board convened in closed executive session for litigation. Randy Dean and Jim Howard were absent from Tuesday’s meeting.