State could lose another four nursing homes

A court-appointed receiver has recommended closing four nursing homes that have been in state receivership since January, arguing in court documents that they face financial barriers to operating and meeting required care standards.

The homes–University Skilled Nursing and Rehabilitation in New Haven, Bishops Corner Skilled Nursing and Rehabilitation in West Hartford, Soundview Skilled Nursing and Rehabilitation in West Haven and Rocky Hill Skilled Nursing and Rehabilitation–have 472 licensed beds and employ about 400 people. They were previously part of the troubled Haven Healthcare chain and were sold after Haven declared bankruptcy. Until January, they were managed by Genesis Eldercare Network Services.

The four homes had a net loss of almost $6.5 million in 2009, receiver Phyllis A. Belmonte wrote in a motion filed in Hartford Superior Court earlier this month. The homes, which predominantly care for patients covered by Medicaid, would not be able to generate enough income to cover their operating expenses even if rent, management fees, capital improvements, wage and benefit increases and inflation were not included, she wrote.

The homes could avoid closing if someone agrees to buy them. Industry and union representatives said two or three companies have expressed interest, although it’s not clear how serious it the interest is. A hearing for prospective buyers is scheduled for Friday, and a hearing on the motion to close the homes is scheduled for next Tuesday.

The move to close the homes was filed two months after they went into receivership–a timeframe that some industry experts said is unusually short.

In her motion, Belmonte noted that state law includes time restrictions on the receiver’s work. Within “a reasonable time period”–not more than six months–the receiver must determine whether a facility can continue to operate and provide adequate care to residents, and seek proposals to buy the facilities.

“These time lines are especially critical given the State’s current fiscal crisis,” and the receivership’s reliance on the state Department of Social Services, Belmonte wrote.

The state pays the expenses of receivership.

Deborah Chernoff, spokeswoman for the New England Health Care Employees Union, District 1199, which represents workers at the four homes, said that in the past, the state would run homes in receivership for “quite a long time,” until they could find a buyer. More recently, she said, the window for keeping homes open while searching for a buyer has been getting narrower. She called the two month period between the homes going into receivership and the motion to close them extraordinarily fast.

“I’ve never see it that fast,” she said. “We think it’s way too fast.”

In recommending that the homes be closed, Belmonte wrote that she balanced the potential for transfer trauma for the residents and the facilities’ roles as employers and taxpayers with the cost of receivership when a sale is not realistically possible. She noted that there is competition for residents near the homes, and cited a survey by the Department of Social Services that indicated there are “more than adequate” nursing home beds within a 10-mile radius of each facility.

None of the homes in receivership have operated at full capacity in the past two years; one home had a high of 90 percent of its beds filled, but the others had occupancies in the low- or mid-80s, Belmonte wrote. Each home was cited for code or physical plant problems during inspections in 2010, although Belmonte wrote they are now in substantial regulatory compliance.

While DSS evaluated the availability of nursing homes in each area, Chernoff said the size of the area included does not reflect the challenges a closure could pose to a resident or a resident’s family, particularly those who depend on public transportation. Getting transferred from a nursing home in the city where relatives live to one in the suburbs could make it harder for family to visit, she said.

“Now it’s not a few blocks away or a bus ride away, it’s an expedition to go,” she said.

And that can be a problem for workers who rely on public transportation, said Rep. Patricia A. Dillon, D-New Haven, whose district include one of the homes. “It’s an economic development issue as well,” she said.

Dillon is concerned that New Haven has lost three nursing homes with more than 400 total beds in the past 10 years and now has two more in financial trouble. In addition to the potential closure of the home in receivership, the city’s Jewish Home for the Aged recently filed for bankruptcy.

“I think there’s no question that we’re going through a restructuring and that maybe at some point we had more beds than we needed,” she said. “But it appears that it’s the urban beds that are most disposable and some of the people are in long-term care, some of them are in rehab. People do better if they have access to their loved ones.”

Statewide, 41 nursing homes have closed since 1995, a loss of more than 3,500 beds.

In the past, Chernoff said, workers at nursing homes that closed were able to find new jobs relatively easily. But with no increase in state reimbursement rates since 2007, nursing homes have been laying off workers or cutting back their hours, not hiring, she said. Some union members who worked at Crescent Manor, a Waterbury home that closed in December 2009, still have not found steady work, she said.

“We’re very concerned about the jobs, but also, frankly, these are people’s homes,” Chernoff said. “They may not be the ideal place, but it is the place that they call home.”

When a Haven home in Waterford closed in December 2008, some residents went to another nursing home in Griswold, Chernoff said, only to have that home close in April 2009. “It’s extremely traumatic,” she said.

If the homes close, DSS, the Department of Public Health and the Office of the State Long-Term Care Ombudsman would work together on a discharge and transfer planning process, said Juliet Manalan, press secretary for Gov. Dannel P. Malloy.

In addition, she said, the administration would work with the unions and other nursing homes “to help connect the employees with opportunities in other homes.”