SWOT Analysis

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J asper Gardens is a for-profit nursing home located on east side ofJasper, about five miles from the city center. The facility is a one-story modern building with ample parking and significant room for expansion. It is located near Medical Associates on 65 acres of land adjacent to the

newly approved highway, approximately one mile from the planned Jasper-East exit. Jasper Gardens

is licensed to operate 110 beds. T t currently operates and staffs I 06 beds in both private and semi

private rooms,

JEFFERSON PARTNERS, LLC

Jasper Gardens is owned and operated by Jefferson Partners, LLC. 'Ibis corporation owns and oper ates nursing homes, assisted living facilities, retirement living communities, and adult day care cen

ters in the greater Capital City area and statewide. Jefferson Partners is a private equity partnership of investors. None of the investors is involved in the day-to-day management of the corporation.

The partners have quarterly board meetings, and their executive committee meets monthly with the professional senior management ream co review operations and issues. Jefferson Partners acquired the

Jasper Gardens property in 1995 and has continuously invested in the property. Jefferson Partners has two operating divisions: property and management. The management

division provides centralized administrative services, such as pay roll, legal services, financial manage

ment, and group purchasing for its facilities, and it also charges a management fee for its services.

Case 7: Jasper Gardens Nursing Home 231

The property division owns the buildings and land, and ir leases these properties co wholly owned subsidiary corporations that manage the individual operations. As such, Jasper Gardens leases its current building and land.

The senior managemenc team of Jefferson Partners includes Ralph Jefferson, presi dent and CEO, and Mary Charles, RN, vice president of operations. David Fellows is the direccor of corporate development and acquisitions. Martha Wyman is the chief financial officer. 1he senior management team/central office approves the annual budget for each facility. Charles meets monthly with facility administrators co monitor operations and co address problems and issues. Jefferson Partners maintains professional offices and a small, central staff in Capital City.

HISTORY

The Jasper Gardens Nursing Home traces its hiscory back co 1960, when it was founded by Mary and John Decker. The initial facility was a former resorr that accommodated 45 residents in semiprivate rooms. During the 1970s this facility was modified co accommo date 70 residents and was licensed under the Medicaid and Medicare programs. In 1980, the Deckers sold the facility co the Armstrong family, who then built four new wings of patient rooms, each with 12 semiprivate rooms. On each occasion, the scate awarded a Certificate of Need (CON). This construction project (1981 to 1983) used the original srrucrure for administrative offices and common areas.

Between 1990 and 1995, the facility was modified into its current configuration with five wings and a central building for administrative patient care. In this modification, che original resort house structure was demolished and totally replaced. The original four wings were updated and modified. Jefferson Partners acquired the facility in 1995. Today the structure is modern and tastefully decorated to emphasize the residential nature of a contemporary nursing home.

Until 1992 the state CON law regulated any expansion in nursing homes char cost more than $500,000. Today the threshold for nursing homes is the same as for acure care facilities. In 1992 the Stace also ceased allowing any nursing home to expand its bed capacity 5 percent each y ear without a CON, regardless of cosr. It should be noted thac capicaJ coses are capped and used to determine state Medicaid rates for nursing homes; they constitute less than 5 percent co a rate calculation. Currently, che scare has placed a mora torium on CON applications for skilled nursing facility and intermediate care facility beds pending changes in che state CON law. However, the governor has granted permission that che number of beds in a nursing home may increase if che cotal number of nursing home beds within a county remains unchanged.

When Jasper Gardens was originally founded, the surrounding area was relatively rural. Today it is becoming more suburban, and a number of housing developments have been built nearby. A shopping center is located approximately a quarter-mile away. The

232 The Middleboro Casebook

area is expected to grow and develop significantly with the opening of the new interstate road between Jasper and Capital City.

The facility introduced Resident Community Councils in 2007, which give resi dents opporrnnities co meet with the staff to express their wishes and preferences. Jasper Gardens has been recognized as a regional leader in empowering residents and creating a homelike atmosphere. Its promotion materials stress this and cite many examples:

The residents have choices with respect to how they want to live. We promise to listen and strive to accommodate resident choices so that we can fulfill their wishes for daily living. A "fine dining" program is available to a different group of residents daily. We create a restaurant-like atmosphere here with fine china, silverware, and food and per sonal service. Residents go to local restaurants regularly in groups, by themselves, or bring food back to their rooms for private dining. Bathing or showering times are hon ored by request for time, day, and frequency. Staff members have consistent a�sign ments of residents for continuity of care and familiarity of daily routines for residents. The facility makes available its facilities and space to the community for meetings and social functions.

For the past four years, Jasper Gardens has been a semifinalist in the statewide competition for the Quality-of-Life Award granted by the governor to the nursing home best able to demonstrate its commitment to resident independence and to giving patients choices regarding their care and services.

PATIENT SERVICES

Jasper Gardens is licensed by the state to operate 110 nursing home beds. It accepts all forms of payment. It is 100 percent Medicare- and Medicaid-certified and fully approved to provide skilled nursing and rehabilitation services covered by Medicare. Medicaid cov ers most patients. Physical therapy (PT), occupational therapy (On, recreation therapy, and speech therapy (ST) services are available onsitc. These rehabilitation services are also available to area citizens as outpatients. These outpatients use either Medicare Part B or commercial insurance to cover associated charges.

Jasper Gardens classifies its patients and residents and many of its services using "intermediate care" and "skilled care." The term resident implies an individual with an average length of stay (ALOS) of more than three months, whereas the term patient means an individual with an ALOS of fewer than I 00 days. Intermediate care services emphasize long-term residual services. In 2014, the ALOS for intermediate care patients is 2.8 years and has been increasing. The average age of current residents is 87 and has slowly been increasing. Some residents in chis category have the ability to pay for care when they are initially admitted. Many, however, after spending down their available personal resources,

Case 7: Jasper Gardens Nursing Home 233

have their care financed by Medicaid. The average spend-down period for the residents ofJasper Gardens, over che past five years, has dropped from 16 months to 13 months. A

few patienrs in this category are covered by private nursing home insurance or insurance provided by the US Department of Veterans Affairs.

Skilled care patients are in the nursing home for pose-hospital rehabilitation. Patients older than 65 years of age rely on Medicare as their primary insurance. These patiencs make use of P T, OT, and ST services. 1hose not eligible for Medicare typically rely on a private health insurance plan to cover these services. In 2014 the ALOS for Medicare patients was 36.2 days; it has been decreasing over the past five years. However, 40 percent

of Medicare patients stay beyond 60 days. For patients covered by private or commercial health insurance, the ALOS in 2014 was 24.3 days.

Registered nurses (RNs), licensed practical nurses (LPNs), licensed nursing assis tants (LNAs), and medication nursing assistants (MNAs) provide nursing services. A part time registered dietitian supervises all food services. Social work services are provided during che admissions process and are available on an in-patient basis. Pharmacy services are provided on contract by DRUGCO, Inc.

The medical director is James A. Child, DO. He is board certified in family practice and gerontology, and he operates a practice in Jasper with Ors. Freda Evans and David

Dodger. Ors. Evans and Dodger provide backup on-call services at Jasper Gardens as needed. All three are active medical staff members at Webster Hospital and have consulting medical staff privileges at Osteopathic Medical Center in Capital City. Dr. Child devotes approximately one day per week to his patienrs in Jasper Gardens.

The facility is physically divided into five adjacent wings. Four of the five wings have nine semiprivate rooms and two private rooms. The facility has eight private rooms in coral. These four wings were part of the original 1980 construction and have been modified

over the years to accommodate larger low1ges and patient common areas. The fifth wing, added in 1995, has 13 semiprivate rooms and houses the rehabilitation services depart ment. Each wing also has a nursing station, a shower room, and a small library. Wireless

Internet is available throughout the entire facility. The beauty salon and barbershop are locaced in the central commons area. Most patients enter Jasper Gardens following dis charge from an area hospital. Primary referral sources include the hospitals locared in

Middleboro and Capital City.

ORGANIZATION

Jasper Gardens is organized using a flat management structure. The senior management team reporrs to the administrator who in turn reports ro Mary Charles, the vice president of operations for Jefferson Partners LLC (located in Capital City). The senior management team meets weekly to review the budget reporcs furnished by Jefferson Partners. Each of the senior managers supervises and directs multiple departments and staff.

234 The Middleboro Casebook

Jayne Winters, NHA, is the licensed administrator ofJasper Gardens. She is a grad

uate of an eastern university and holds an undergraduate degree in health services manage

ment. On her grad_uation in 2006, she completed her administrator-in-training program at

a Jefferson Partners facility in Capital City. Upon completion of this program, she earned

her state license and was appointed as assistant administrator at Jefferson Partners' larg est nursing home, an assisted living and congregate living (apartment) facility in Capital City. She was appointed administrator of Jasper Gardens in 2010. Winters is active in the

statewide association of long-term care administrators and lives in Jasper. Winters also

manages all aspects of personnel and human resources administration. For example, her

office releases all advertisements for employment and screens all applicants. Wage and sal

ary rates arc set during the annual budgeting process, with changes requiring the approval

of Jefferson Partners. Winters and her administrative assistant, Carol Hyde, administer all

employment (including employment background checks) and benefit policies. 1

Over the past 18 months, employees have filed formal grievances related co "unfair

interpretations" involving annual and sick leave policies, merit pay adjustments, and rates

paid co part-time workers who work on national holidays. During this same period, three employees were discharged for failure to perform stated duties. It should be noted that one

of Winters's first actions as administrator was the dismissal of three employees for nepo

tism. This action is still remembered by many of the staff, who felt the dismissals were not necessary, especially because these employees were hired before a formal policy on nepo

tism was instituted. Recently two other employees were discharged for poor attendance

and work performance. Winters is also responsible for all advertising and promotional

programs designed to call attention to the facility.

When interviewed, Winters indicated that Medicaid pricing bas continued to force

Jasper Gardens to carefully reconsider all staffing levels and in some instances co reduce

staffing. She indicated that any nursing home-and especially Jasper Gardens-works

within slim annual financial margins and that small staffing increases could easily evapo

rate its modest profitability. She also indicated that her employment contract does include

certain incentives and penalties related to quality of care and financial performance. When asked to identify and discuss significant issues, she noted chat for the past

two years Jasper Gardens has received a deficiency-free survey from the state Department

of Health-Level B. This, she explained, is a significant improvement over the conditions

that existed when she was hired. Prior to 2010, the state survey team awarded Jasper Gar

dens scores that indicated widespread potential for more than minimal harm to patients (Levels E and F). Winters stated that the positive surveys over the past three years were the

result of a solid and dedicated team effort and changes in some job responsibilities. She

also indicated that, over her four-year career at Jasper Gardens, patient acuity and levels of

need have increased: "The intensity of needed care has increased significantly. More and

more of our older residents are exhibiting behavioral problems. Even though our staffing

has remained about the same, our residents seem co need more and more care."

Case 7: Jasper Gardens Nursing Home 235

Three years ago, Jasper Gardens' workers' compensation rates doubled based on its history of worker injuries. The most common injury has been back strains and pulls asso ciated with assisting and lifting residents from their heds. During 2014, because of new policies and the arrival of new equipment ro help staff assist residents, no staff member

reported back injuries. No union has ever represented the hourly staff at Jasper Gardens. Unofficially,

Winters &d indicate that she and her management team have heard rumors char a local union in Capital City will be sending cards co the hourly staff to determine whether che staff wants the union co represent their interests. A union formally approached che staff four years ago. If a sufficient number of cards are returned to the union, it will petition the scare labor board for permission to hold an election and form a bargaining unit.

A number of residents use electric wheelchairs and carts for transportation around the nursing home and use chem to frequent the small park on the grounds of the facility. In two instances over the past 18 months, "crashes" inside the facility have injured three residents. fu the area has developed with wider roads and sidewalks, a small number of residents also have begun to use their personal mobility cares to go to the local shopping center. To leave the building and grounds of Jasper Gardens, a resident must secure per mission from the supervising nurse and take a wireless phone furnished by the nursing home. Legal counsel is reviewing this practice co ensure chat it is in keeping with current laws and regulations. Two different families have requested that the residents be restricted to using the cans only on the property of the nursing home. Current policies do not allow for these restrictions unless they are based on appropriate legal (e.g., power of attorney) or medical orders. Medicare purchases these cares for any mobility-impaired individual who is 65 years old or older. Recently an ambulatory resident, who had walked to a local shopping center, became disoriented and had co be brought back co Jasper Gardens by the

police. This is the fifth such instance within the past six months. When interviewed, Winters said:

I am very pleased with the progress we have made here over the past four years. The facility

looks good, the staff is dedicated, and the owners are comfortable with our [profit] mar

gins. We have been challenged to get our personnel system in better shape and have been

responsive to needs of our workers. I sincerely hope that we do not unionize, although we

fully support our employees' rights in this area. I know that Jefferson Partners is going to

want us to continue to develop this facility. Especially with the new interstate road, which will

significantly cut down on the travel time between Jasper and Capital City, we may have the

potential for open senior living apartments and an assisted-living facility here on our current

campus. We have the space and a great deal of the infrastructure to move in this direction.

When asked about .the management reports she relies on, Winters said that her "dashboard report" is critical to ncr ability to stay abreast of the management issues in the

236 The Middleboro Casebook

facility. This weekly report includes the following information for the latest week, month,

quarter, and year to dace:

+ Revenue and expense budget performance

+ Payroll information: budgeted versus actual hours, dollars, and overtime

+ Patient census by payer

+ Admissions and discharges

+ Therapy revenue, expenses, and hours

+ Employee health insurance claims submitted

+ Primary quality indicators:

Facility-acquired pressure ulcers

Falls

Injuries

Weight loss

Reportable events

Acure discharges

Michele Regan, RN, is director of nursing and patient services at Jasper Gardens. She holds an undergraduate degree in nursing and master's degree in geriatric nursing. She has more than 20 years of professional experience in long-term care nursing. She joined the nursing staff at Jasper Gardens as the day-shift charge nurse in 2004. She was appointed

to her current position in 2009. She supervises the day (7:00 a.m.-3:00 p.m.), evening

(3:00 p.m.-11 :00 p.m.), and night (11:00 p.m.-7:00 a.m.) nursing supervisors. There are two day-shift charge nurses. Each is responsible for approximately half of the patients.

Aside from supervising all nursing servict::s, Regan also supervises the ancillary services unit

(i.e., P'f, OT, ST, and respirarory therapy) and the recreation unit, and she coordinates all pharmaceutical services. W hen interviewed she discussed staffing and management issues.

She indicated that (surprisingly) Jasper Gardens rarely has experienced any problem hir ing qualified RNs and LPNs. She indicated that Jasper Gardens experiences the expected turnover in its LNA workforce and that she would like to hire more MNAs when LNA

openings occur. She also indicated that staff scheduling was always an issue: "We seem to

be in a cacch-22. Recently we have begun to hire more part-time staff. But scheduling them and relying on them to work a few extra hours to help us cover a shift here and there has been difficult and disappointing. In the past we hired some floating full-time staff to cover

Case 7: Jasper Gardens Nursing Home 237

as needed, bur we moved to part-time staff co save money. This move seems to have made staffing much more difficult. It appears that the critical complaint of our part-time staff is that they do not have sick leave, something very important ro them when they have sick children." '

Regan did speak positively about the certified therapeutic recreation specialists who now staff che recreation department. Jasper Gardens began hiring certified specialises in this department four years ago, and it has "led to our recreation services deparcmenr being one of the best in the state."

Working with the medical director, Dr. Child, Regan is also responsible for the formulary, ensuring that adequate pharmacy stock is maintained and that appropriate inventory safeguards are effective. She is responsible for the ordering and inventory of all medical supplies. Medical supplies arc purchased using contracts negotiated and adminis tered by Jefferson Partners.

W hen asked what changes she would like co see, she stated, "Our current policy concerning residents being hospitalized and then returning may need to be reconsidered." She stared, "Our current policy is char we will not keep a bed open for a resident who is admirred to a hospital unless they pay for it during their hospitalization or absence. If the bed is nor paid for, we will refill it after 24 hours. We also have a I 0-day limit on how long any bed may be unoccupied even if the per diem charges are being paid." She con tinued, "This can really cause problems for our residents, but we need to keep our beds full. lhe situation is just not good for our residents, even though it might be a required

business practice. We really try co accommodate our residents, but frequently we can't." She also indicated that a plan to dedicate one wing to patients with Alzheimer's disease and dementia, an idea recently discussed with the owners, might be needed and that such a wing would expand the range of patient care services offered.

Margaret Hemp is the director of admissions and social services. She has an under graduate degree and a master's degree in social work and more than 15 years of professional experience. Prior to her appointment as director of admissions in 1999, she held a similar position at another nursing home in Capital City. She meets with all prospective residents and their families. She also helps potential and current residents qualify for Medicaid. Periodically she leads the team that reviews the medical and social needs of all residents, and she files reports as needed. Each resident maintains a modest cash account co support

certain purchases (e.g., beauty shop). Hemp manages this system in keeping with federal and state regulations. Aside from working with the discharge teams at the hospitals located in Middleboro and Capital City, she also has regular contact with the Hillsboro County Home Health Agency and the home health agencies located in Capital City. When inter- viewed, she stated:

Overall, Jasper Gardens is not unique. We have a dedicated staff. Our resident popula

tion is getting older, and recent Medicare admissions have required significantly more

238 The Middleboro Casebook

therapy and services than in the past. Changing federal and state regulations covering

Medicaid eligibility make aspects of my job demanding. I spend a great deal of time

completing the minimum data set on residents to be admitted, and I spend time with

our nursing supervisors filing reports on our current residents.

We really do reflect the community we serve. Our residents, for the most part, come

from right around here, although the new interstate should bring us even more Capital

City residents. We are fortunate that a significant number of our residents have family

and friends in the area who still visit them. We seem to have more visitors than other

homes that I am aware of. I enjoy working here.

Ralph Doyle is the director of plane operations. He is responsible for all aspects of

rhe physical facility, including maintenance, laundry, and housekeeping services. His sraff also runs the van that takes residents to appointments and on shopping trips. lie retired from rhe military in 2004 and has served in this role at Jasper Gardens since 2006. Prior to his current employment, he was the associate director of facilities at another nursing home in Capital Ciry. Under Doyle's leadership, Jasper Gardens has received no negative reports or citations regarding any aspect of facility, including fire safety inspections. In 2011,

Jasper Gardens installed new onsite generators. Jasper Gardens has the ability co function

"off the electric grid" for a maximum of 12 days. This addition completed a plan to make

this home energy independent to ensure the safety of all residents. When interviewed he stated:

Well, those electric carts-some call them scooters-really cause us problems. Most

can't be stored inside the facility because of existing regulations covering their recharg

ing. We have had to develop a space in another building for their storage, and we bring

them in and out as the residents want them. Maybe they should be banned, especially

inside the facility, as they can frequently mark or damage our floors and walls. Some

times l feel that we are running a valet service for these carts. Overall, this is a solid

facility. It is clean and relatively modern and well lighted. I am proud of how our staff

has made this older facility look good. Now that we are energy independent, I sleep

better at night. We also have a staff that understands our need to periodically have fire

and emergency drills. This has helped a great deal. One of my many duties, however,

is security. While all staff members wear badges and are instructed to question any

visitors they do not know, it frequently comes down to my staff being called. I question

whether we can and should remain as open as we are. Residents can potentially leave

anytime they want, and outsiders can enter multiple doors from 7:00 a.m. to 8:oo p.m.

before the building is "locked" for night. This may be an issue that needs attention.

It should be noted that, based on Doyle's recommendation, all residents who want ro use motorized wheelchairs and carts must complete driving lessons done by a trained instructor and earn a scooter license from Jasper Gardens.

Case 7: Jasper Gardens Nursing Home 239

Bonnie Keana is the senior administrative assistant and bookkeeper. She is respon sible for preparing the payroll and supervising the posting of the financial journal and the general ledger. Based on information she prepares, Jefferson Partners provides budget status reports every week and interim financial statements monthly. Keana is also in charge of local purchasing, and she supervises the reception staff.

MANAGEMENT OPERATIONS

Every Tuesday morning, Winters, Regan, and Hemp meet to review the sracus of all patients. Data include quality measures used by the Medicare Quality Improvement Organization and Centers for Medicare & Medicaid Services (CMS) as well as ocher data reported to Jefferson Partners. Once a month this committee includes others (including the medical director) as needed from its Continuous Quality Improvement Comminee and reviews all data to determine which patients and CMS items need attention, why, and the creaunent and prevention approaches being used.

Every Friday morning, Winters, Regan, and Hemp plus Doyle and Keana meet as the management team and review the most recent dashboard report, budget status report, and other issues needing management's attention.

CURRENT ISSUES

PERSONNEL AND UNION ACTIVITY

When interviewed, Winters and Regan both indicated char access to qualified professional staff was not a major problem. They stated, "We have been able to hire highly qualified professionals who have generally stayed with us for significant periods of time." Over the years, ho�cver, some wages have nor kept pace with the regional market. This rrend has been directly traceable to Medicaid rates paid by the state. Over the past ten years, state Medicaid rates have fallen from being the tench highest in the United Scares co the eighth lowest.

Four years ago, the hourly employees were mailed cards and mer regularly with union organizers from Capital City. This effort did not yield a sufficient number of staff ro petition to form a bargaining wiit. Two years ago, as part of study done by an external con sulcanc, employees expressed three primary job concerns. They were concerned that wages were below market norms, that benefits were administered unfairly, and that job expecta tions were unclear. After this study, Jefferson Partners did authorize some wage changes and committed ro follow a standardized system of benefits for all employe�. This system is described in a new and expanded employee manual, which has nor yet been published. The study also instructed the administrator to review and update all job descriptions and co enhance the system of annual evaluation. Merit pay was introduced in 2013 but has met with mixed reviews and results. F.�mr years ago, the personnel system was ad hoc and poorly defined. It still exhibits a number of shorccomings. For example, a number of employees remain confused about their eligibility for cercain bendic:. ,md how co �e benefits.

240 The Middleboro Casebook

REHABILITATION SERVICES UTILIZATION

Rehabilitation services (i.e., PT, OT, ST, and respiratory therapy) are available for nursing

home residents as well as members of the community. Most pay for these services using

Medicare Part B or private insurance. Outpatient utilization continues to be almost nonex

istent. Currently, individuals in need of ambulatory rehabilitation services typically travel to either Capital City or Middleboro. Jefferson Partners has asked Jasper Gardens for a

plan to address this potential market as part of the upcoming review of the draft budget

for 2016. Jasper Gardens estimates chat for 2015, service demands (in relative value units, or

RVUs) will be 5,000 units in PT, 7,500 units in OT, and 700 units in ST. Space exists to address the needs of more patients. Note that workers' compensation provides an annual

limit of up to 24 PT and/or OT visit per year per injury. Jasper Gardens' 2015 staffing devoted co providing patient services (in FTEs) for this department will be

+ 1.0 PT,

+ 0.3 physical therapy assistant,

+ 1.0 OT,

+ 0.7 certified occupational therapy assistant, and

+ 0.3 ST.

Note that the supervisor of this department splits her time between adminisrration

and providing P T services. Jefferson Partners has a target chat 90 percent of available time in a rehab unit be devoted co patient care.

Increasingly, institutional profitability is based on the success of the SNF unit and

outpatient rehabilitation services. Medicaid rares covering the ICF make it difficult co

achieve institutional profitability.

ADMISSION POLICIES

Beginning in 2014, Jefferson Partners has required that all nursing home patient and

resident applicants submit to a background check as a condition associated with admis

sion. Jefferson Parmers has indicated that no potential patient or resident with a felony

conviction as a sexual predator or offender will be admitted. This policy is explained to

all potential patients and residents. Jasper Gardens has implemented this policy at all of

its facilities. le should be noted that this policy is under legal review at two of Jefferson

Partners' other nursing homes.

Case 7: Jasper Gardens Nursing Home

SPECIAL PROGRAMS AND NEW INITIATIVES

Hospice Care with Capital City VNA

Capital City VNA and Hospice has proposed that a collaborative Medicare-certified inpatient hospice be established at Jasper Gardens. This hospice would serve che greater Jasper community and provide access to these :.ervices to the Medicare-eligible population. Currently, Jasper residents requesting the use of Medicare-certified hospice services must seek care in Capital City. Capital City VNA and Hospice would enter into a contractual relationship with Jasper Gardens for private rooms to be used for inpatient hospice care. The medical director of the hospice would supervise and direct the cases, and nurses from the hospice would be assigned co provide 24-hour care, with support and extra coverage provided by the staff of the nursing home as needed.

Jasper Gardens is able to do this under existing Medicare regulations involving its SNF. It could provide all staffing and direct patient services in this new unit. le could provide a dedicated wing, area, or building with private rooms for the patients, meals, gen eral nursing supervision, and general services (such as housekeeping). Capital City VNA (pocenrially the Medicare-certified hospice) would pay Jasper Gardens (as a subcontractor) a price per patient day to be negotiated. Direct service costs would be approximately $75 per day for the requested services. Jasper Gardens' pharmacy service would provide needed drugs and other durable medical equipment at cost that would be directly reimbursed to the pharmacy by Capital City VNA and Hospice. 1he initial estimate is that Jasper Gardens could add a new dedicated wing of four co eight private rooms at approximately $150,000 per private room (minimum of four).

Assisted Living Facility and Retirement Housing

Jefferso� Partners has included in its strategic plan the development of many more services on the campus of Jasper Gardens. The company is interested in an assisted living facility, congregate living facility (senior apartments), and retirement housing adjacent co Jasper Gardens. 1l1e idea is to use the land currently owned by Jefferson Partners, a location that should be very attractive given the new interstate highway co be opened. This plan would designate the nursing home administrator as the campus CEO. The CEO would be responsible for the facilities on che campus. Staffing would be adjusted as needed so that Jasper Gardens' employees would provide staffing for the new facilities.

Jefferson Partners is currently determining cost estimates for these types of facilities and hopes to have a concepcual plan ready for its architects within six montjis. It estimates that the assisted living facility would cost approximately $300 per square foot and rhat apartments and housing would cost around $200 per square foot. The Jasper Planning Board has indicated rhac current 1.oning would make chis cype of adult senior community a "natural addition" co the nur�ing home campus. The added taxes also would help the

241

242 The Middleboro Casebook

town defray the costs of infrastructure development (i.e., roads, water, and sewer) that it embarked on three years ago. Jefferson Parcners has identified two significant questions to be resolved-w�at is the best size, and what are the associated costs of this plan? The company has indicated that it will complete the market and financial feasibility study for this project in 2015. Some studies suggest that che average length of rental in an assisted living facility is 5.4 years, with a standard deviation of 2.3 years. National studies suggest that these types of facilities are attractive to specific segments of the population.

Information System Developments

Jefferson Partners has recently signed a contract with Nursing Home Systems, Inc., to inscall-companywide-an electronic health record system. Training should begin in nine months, and the system should be fully installed and implemented by December 2015. The system will be a comprehensive medical record with order entry for suppli�s, tests, and all medically related activities. Jefferson Partners estimates that chis system will cost approximately $2,000 per bed to install.

Unrelated co the development of the electronic health record system is che recent request from Osteopathic Medical Center (OMC) in Capital City co partner in a cele healch system. Under chis system a nursing home patient at Jasper Gardens could be evaluated and cared for by an attending physician at OMC. The system should preclude che physical transfer of some nursing home patients to OMC for diagnosis and treatment. Note that if a patient is medically transferred to a hospital, the nursing home can refill the empty bed after 24 hours. No cost estimate for this system is available.

Potential Need and Demand for Alzheimer's and Dementia Wing

Jefferson Partners has requested that the staff assess the need and demand for a wing dedicated to serving patients with AJzheimer's disease or dementia. It has asked the staff co examine options and to indicate characteristics of chis unit (e.g., secured versus unsecured) as well as unique staffing and care needs. Jefferson Partners has requested that this analysis be provided before any decision is made concerning additional construction on the site.

The following cables provide more information about Jasper Gardens' patients, residents, financial status, staffing, and quality measures.

2014

Type of Primary Insurance

Skilled care

Medicare 24

Commercial 1

Intermediate care

Medicaid 60

Veterans Affairs 1

Private insurance 1

Self-pay 12

Total number of beds 1o6

Total filled beds 99

Facility occupancy 93.4%

Number Age Gender

1 99 2

2 99 2

3 I

98 2

4 97 2

s 96 1

6 96 2

7 94 2

8 94 2

9 93 2

10 93 2

11 93 2

12 93 1

13 92 2

Case 7: Jasper Gardens Nursing Home 243

2013 2012 2011

26 24 30

2 3 1

63 60 63

2 2 1

0 0 1

8 7 5

106 1o6 1o6

101 96 101

95.3% 90.6% 95.3%

Months Comm Ins

81.0 9 2

88.o s 2

32.0 9 2

75.0 9 2

41.0 1 2

30.0 3 2

21.0 1 2

27.0 3 2

76.0 s 2

17.0 3 2

34.0 2 2

25.0 3 2

31.0 1 2

2010 2009

22 26

2 1

63 56

1 3

1 1

10 12

1o6 to6

99 99

93.4% 93.4%

Ref

2008

106

91.5%

Sor I

(continued)

TABLE 7.1

Patient Census by

Type of Insurance

as of December 31

TABLE 7.2

Resident

Information as

of December 31,

2014

244 The Middleboro Casebook

TABLE 7.2

Resident

Information as

of December 31,

2014

(continued)

Number

Age Gender

92 2

91 2

90 2

90 1

90 2

90 1

89 1

89 2

89 1

89 2

89 1

89 2

88 2

88 1

88 2

Months

20.0

73.0

84.0

1.0

72.0

56.0

24.0

30.0

23.0

19.0

39.0

48.0

o.8

23.0

24.0

38.0

22.0

60.0

4.0

30.0

2.0

1.0

38.0

30.0

5.0

24.0

26.0

Comm Ins Ref Sor I

3 2 5 I

9 2 1 I

5 2 1 I

5 1 4 s

5 2 2 I

5 2 1 I

9 2 3

1 2 6 I

3 2 2 I

3 2 6 I

3 2 1 I

5 1 6 s

9 2 4 I

3 2 2 I

3 2 1 I

3 2 6 I

3 2 1 I

2 2 5 I

9 2 3 I

3 1 1 s

5 1 2 s

3 2 2 I

3 2 5 I

9 2 6 I

9 2 5 I

(continued)

Number Age Gender

42 88 1

43 87 2

44 87 2

45 87 2

46 87 2

47 87 2

48 86 2

49 86 2

50 86 1

51 86 2

52 85 2

53 85 1

54 85 2

55 85 1

56 84 1

57 84 2

58 84 1

59 84 2

60 83 1

61 83 1

62 83 2

63 83 2

64 82 1

65 82 2

66 82 2

67 80 2

68 80 2

69 80 i

Case 7: Jasper Gardens Nursing Home 245

Months Comm

35.0 3

30.0 5

21.0 9

30.0 3

8.o 10

9.0 1

30.0 3

35.0 3

19.0 3

26.0 3

2.0 3

23.0 3

33.0 2

7.0 4

20.0 6

37.0 3

32.0 3

31.0 3

8.o 3

13.0 3

18.0 5

16.0 1

0.4 2

o.8 9

12.0 9

0.9 5

0.2 5

1.5 3

Ins Ref

2 1

2 6

2 2

2 6

2 5

2 3

2 1

2 6

2 3

1 2

2 3

2 6

6 6

2 5

2 1

2 5

2 1

2 5

2 6

2 3

1 2

2 4

1 1

1 4

1 1

Sor I

(continued)

TABLE 7.2

Resident

Information as

of December 31,

2014

(continued)

246 The Middleboro Casebook

TABLE 7.2

Resident

Information as

of December 31,

2014

(continued)

Number

Age Gender

80 . 1

78 2

78 1

77 2

73 2

71 2

70 2

69 2

68 2

67 1

66 1

66 2

65 2

63 1

62 2

61 2

60 1

59 1

59 2

58 2

58 1

57 2

Months

0.5

0.3

1.0

0.2

2.0

o.8

11.0

0.9

0.5

1.0

0.5

2.0

8.o

0.5

9.0

2.3

0.5

2.5

2.0

3.0

9.0

7.0

0.5

3.0

10.0

0.5

7.0

1.5

Comm Ins Ref Sor I

5 1 6 s

1 1 5 s

3 1 2 s

3 1 1 s

3 1 4 s

3 6 1 I

5 1 4 s

3 1 4 s

3 1 1 s

3 1 2 s

3 1 3 s

3 6 2 I

3 1 2 s

3 6 5 I

3 1 6 s

3 1 4 s

3 5 2 I

3 6 2 I

3 4 1 s

3 6 5 I

3 6 3 I

1 3 2 I

3 6 1 I

1 6 1 I

3 2 2 I

3 6 1 I

9 2 3 I

(continued)

Number Age Gender

98 56 2

99 28 2

NOTES: Number= Patient ID number Age = As of December 31

Gender: 1 = Male; 2 = Female Months = Months in residence Comm= Community of origin:

1 Middleboro

2 Mifflenville

3 Jasper

4 Harris City

5 Statesville

6 Carterville 7 Boalsburg

8 Minortown

9 Capital City

10 Other

Administration Administrator

Case 7: Jasper Gardens Nursing Home 247

Months Comm

10.0 3

12.0 2

Ins = Insurance 1 Medicare 2 Medicaid

Ins

3 Veterans Affairs 4 Commercial 5 Other private 6 Self-pay

Ref = Referral

Ref

1 Middleboro Community Hospital 2 Webster Hospital 3 Osteopathic Medical Center 4 Other Capital City hospital

5 From home 6 Other

S = Skilled care I = Intermediate care

Sor I

2014 2013

1.0 1.0

TABLE 7.2

Resident

Information as

of December 31,

2014

(continued)

TABLE 7.3

FTE Staffing as of

December 31

Payroll supervisor* 1.0 1.0

Receptionist* 1.0 o.8

Maintenance Supervisor 1.0 1.0

Staff* 0.5 o.6

Housekeeping Supervisor 1.0 1.0

Staff* 5.3 5.5 -

Laundry assistants* 2.6 2.8

(continued)

248 The Middleboro Casebook

TABLE 7.3

FTE Staffing as

of December 31

(continued) Dietary Supervisor

Dietician, director

Cooks*

Assistants*

Nursing Director

MDS coordinator

Staff development coordinator

RN supervisor

RN charge*

LPN charge*

Certified nursing assistants*

Medical technologists*

Medical records*

Recreation Supervisor

Staff*

Social services Supervisor

Staff, admissions*

Staff*

Therapy Rehab director

Physical therapist*

Physical therapy assistant*

Occupational therapists*

COTA*

Speech therapist*

Total

NOTE: 1.0 FTE works 1,896 hours per year

* = hourly employee

2014 2013

0-4 1.0

0.5 0.5

2.9 2.9

6.7 6.5

1.0 1.0

2.6 2.6

6.2 6.3

9.3 9.2

37.8 38.2

1.3 1.3

o.8 o.8

1.0 1.0

2.0 2.2

1.0 1.0

0.7 0.7

1.0 1.0

0.5 0.5

0.3 0.5

1.0 1.0

0.7 o.8

0.3 0.4

94.4 96.1

Case 7: Jasper Gardens Nursing Home 249

2014 2013 2012

Patient days

Medicare 8,840 8,723 8,690

Medicaid 22,468 21,858 21,278

Self-pay 4,420 4,670 4,960

Other 1,105 1,106 1,530

Total 36,833 36,357 36,458

Annual occupancy 95.2% 94.0% 94.2%

Resident deaths 24 28 27

Ancillary services (RVU)

PT treatments 4,592.00 4,620.20 4,320.00

OT treatments 7,269.60 7,023.00 6,530.00

ST treatments 603.20 580.00 566.40

Total 12,464.80 12,223.20 11,416.40

NOTE: 1 RVU = 15-minute service unit

Statement of Operations

Revenue

2015 Budget 2014 2013 2012 2011

-· '. .. . ..

Room and board

Skilled care

4,135,329 Medicare Part A 3,977,963 3,820,494 3,820,494 3,72.4,383

215,383 Commercial 202,582 225,230 210,494 236,191

2011

8,657

20,780

5,140

1,357

35,934

92.9%

4,734.50

6,938.00

610.20

12,282.70

2010

-·· ·

3,650,292

190,393

(continued)

TABLE 7.4

Operational

Statistics by Year

TABLE 7.5

Statement of

Operations for the

12-Month Period

Ending December

31, 2010-2014,

and the 2015

Budget($)

250 The Middleboro Casebook

TABLE 7.5

Statement of

Operations for the

12-Month Period

Ending December

31, 2010-2014,

and the 2015

Budget($)

(continued)

Revenue

2015 Budget

3,816,373

1,745,292

97,292

139,292

10,148,961

. . .. , .

834,282

54,303

18,373

906,958

21,494

3,200

24,694

11,080,613

(315,230)

(3,129,492)

7,635,891

Expenses

2015 Budget

1,790,400

560,304

120,494

Intermediate care

Medicaid

Self.pay

Private insurance

Total room and board

Ancillary revenue

Skilled care

Medicare Parts A and B

Commercial

Intermediate care

Medicaid

Other

Total ancillary revenue

.·

Other revenue

Interest

Miscellaneous

Total other revenue

Total revenue

Less provider tax

Less ancillary contractual allowances

Total net revenue ..

Salaries

Nursing

Dietary

Ancillary-PT

Statement of Operations

2014 2013 2012 2011 2010

4,156,604 4,198,356 4,145,291 3,953,282 3,640,439

1,325,988 1,839,202 1,820,394 2,134,203 2,340,203

92,083 92,363 90,383 189,243 83,405

97,607 45,393 23,040 21,450 18,450

9,852,827 10,221,038 10,110,096 10,258,752 9,923,182

795,593 790,373 713,282 702,393 650,393

38,675 39,294 60,393 50,383 47,293

19,547 14,292 13,258 16,393 18,363

0 0 0 0 200

853,815 843,959 786,933 769,169 716,249

18,417 13,292 15,202 16,729 18,560

3,683 3,125 5,403 6,230 3,720

22,100 16,417 20,605 22,959 22,280

10,728,742 11,081,414 10,917,634 11,050,880 10,661,711

(313,081) (343,560) (313,596) (302,383) 342,474

(3,057,067) (3,100,867) {2,948,202) (3,000,272) (2,947,353)

7,358,594 7,636,987 7,655,836 7,748,225 8,056,832

2014 2013 2012 2011 2010

1,789,393 1,800,249 1,840,292 1,934,929 1,997,239

556,933 555,002 550,383 480,272 515,388

103,272 105,230 107,292 107,252 113,282

(continued)

Expenses

2015 Budget

Salaries

65,202 Ancillary-OT

24,300 Ancillary-ST

145,892 Ancillary-RT

108,202 Housekeeping

135,200 Administration

109,303 Social services

82,340 Recreation

75,300 Physician services

60,203 Laundry

60,392 Maintenance

3,337,532 Total salaries

1,134,761 Benefits, all

4,472,293 Total salaries and benefits

Admin and general

50,000 Accounting fees

30,200 Telephone 33,000 Insurance-general 17,500 •. Payroll services

16,200 MIS management

12,500 Dues and licenses

10,500 Office supplies

8,500 Postage

8,000 Legal

7,893 Auto 5,000 Advertising 2,000 Misc. bank charges

4,500 Admin equipment rental

5,000 Other professional fees

1,200 Printing and publishing

211,993 Total admin and general

Case 7: Jasper Gardens Nursing Home 251

Statement of Operations

2014 2013 2012

62,701 68,303 64,393

22,130 20,130 25,303

140,155 130,202 120,303

104,383 110,393 131,303

131,340 141,200 178,202

104,838 103,292 103,202

79,362 80,350 78,383

73,278 70,282 82,345

58,964 68,002 78,393

55,282 65,303 62,010

3,282,031 3,317,938 3,421,804

956,838 995,381 1,094,977

4,238,869 4,313,319 4,516,781

CY CY·t CY-2

60,000 60,000 70,000

33,799 34,292 35,292

30,319 29,200 29,500

18,228 18,200 18,400

16,415 16,000 16,000

13,054 14,303 13,500

10,424 8,939 7,830

9.379 9,100 9,320

8,000 12,503 17,394

7,893 7,893 7,893

6,000 6,000 5,780

3,800 2,000 2,560

4,785 5,640 5,500

8,979 3,502 3,012

1,489 1,648 1,102

232,564 229,220 243,o83

2011

58,303

27,393

127,303

130,292

204,393

103,684

74,902

88,202

88,303

60,292

3,485,520

1,219,932

4,705,452

CY-3

80,000

35,920

34,290

16,393

15,300

17,202

5,920

8,983

12,302

7,893

5,500

2,830

4,950

2,640

1,100

25�23

2010

62,120

25,303

136,303

130,282

180,292

103,606

78,393

67,393

98,303

61,202

3,569,106

1,284,878

4.,853,984

CY-4

80,000

36,303

40,202

16,300

15,100

13,200

4,320

7,839

14,393

7,893

4,000

3,210

4,640

29,456

867

2n,123

(continued)

TABLE 7.5

Statement of

Operations for the

12-Month Period

Ending December

31, 2010-2014,

and the 2015

Budget($)

(continued)

252 The Middleboro Casebook

TABLE 7.5

Statement of

Operations for the

12-Month Period

Ending December

31, 2010-2014,

and the 2015

Budget($)

(continued)

Expenses

2015 Budget

25,300

60,383

220,450

21,340

277,500

200,450

31,500

210,494

10,000

64,897

920,000

200,400

2,242,714

650,000

4,000

654,000

7,581,000

7,635,891

54,891

19,212

35,679

Other operating expenses

Maintenance supplies

Maintenance repairs

Utilities-all

Oxygen services

Food

General supplies

Laboratory services

Pharmacy services

Imaging services

Medical equipment rental

Capital lease

Depreciation-all

Total other operating

Nonoperating expenses

Management fee

Bad debt

Total nonoperating

Total expenses

Total net revenue

Pretax profit (loss)

All taxes

Profit (loss) after taxes

Statement of Operations

2014 2013 2012

24,010 22,310 22,740

50,880 34,272 23,784

219,383 240,120 250,123

20,175 18,393 17,202

267,039 254,499 255,206

202,364 190,303 183,484

28,511 32,404 28,400

207,494 215,450 212,340

11,003 13,204 15,202

64,897 64,897 64,897

900,000 900,000 900,000

204,783 205,29 4 210,494

2,200,539 2,191,146 2,183,872

600,000 750,000 550,000

6,600 6,000 5,325

606,600 756,000 555,325

7,278,572 7,489,685 7,499,061

7,358,594 7,636,987 7,655,836

80,022 147,302 156,775

28,008 51,556 54,871

52,014 95,746 101,904

(This table can also be found online at ache.org/books/Middleboro.)

2011 2010

21,640 20,765

24,450 26,780

250,282 260,383

14,383 18,303

244,351 242,993

178,202 178,202

23,450 287,340

215,202 1125,202

11,023 9,303

60,200 60,200

900,000 900,000

211,474 211,574

2,154,657 2,441,045

500,000 400,000

5,270 3,120

505,270 403,120

7,616,602 7,975,872

7,748,225 8,056,832

131,623 80,960

46,068 28,336

85,555 52,624

Assets

Current

Cash, operating

Cash, restricted

Patient trust cash

Total cash

Accounts receivable-net

Inventory

Prepaid expenses

Total current assets

Plant, property, and equipment

(PPE)

Building, land, and improvements

Fixed and leasehold fixed

equipment

Furniture and other equipment

Automobile

Total PPE

Less accumulated depreciation

Net PPE

Other assets

Security deposits

Total assets

Liabilities and net assets

Current liabilities

Accounts payable

Case 7: Jasper Gardens Nursing Horne 253

2014 2013

3,989,694 3,623,583

396,844 382,374

22,919 24,900

4.409.457 4,030,857

2,083,242 2,156,393

36,404 30,340

50,494 45,202

6,579,597 6,262,792

814,300 795,756

156,303 155,302

1,082,011 995,292

7,227 14,454

2,059,841 1,960,804

1,246,294 1,041,511

813,547 919,293

11,565 9,450

7,404,709 7,191,535

1,847,294 1,945,292

2012

3,056,894

295,750

23,491

3,376,135

2,134,265

22,360

37,345

5,570,105

690,202

155,506

990,385

21,681

1,ss1.n4

836,217

1,021,557

10,474

6,602,136

1,638,294

2011

2,745,020

340,163

21,403

3,106,586

1,990,237

19,372

39,202

5,155,397

680,272

180,383

994,283

28,908

1,883,846

625,723

1,258,123

12,570

6,426,090

1,400,230

(continued)

TABLE 7.6

Balance Sheet as

of December 31 ($)

254 The Middleboro Casebook

TABLE 7.6

Balance Sheet as of December 31

(continued) Accrued expenses

Patient trust liability

Accrued interest

Total current liabilities

Long-term liabilities

Deferred lease obligations

Due to (from) Medicaid

Notes payable

Line of credit

Total long-term liabilities

Total liabilities

Net assets-owners equity

Liabilities + net assets

2014

635,640

22,919

9,371

2,515,224

2,541,464

(198,872)

874,260

651,026

3,867,878

6,383,102

897,725

1,2so,s21 I

2013 2012 2011

685,205 690,283 695,304

24,900 23,491 21,403

9,145 8,628 8,120

2,664,542 2,360,696 2,125,057

2,734,820 3,028,349 3,450,203

(106,392) (154,292) (254,981)

550,393 525,404 503,282

655,230 230,450 201,494

3,834,051 3,629,911 3,899,998

6,498,593 5,990,607 6,025,055

692,942 611,529 401,035

7,191,535 6,602,136 6,426,090

(This table can also be found online at ache.org/books/Middleboro.)

TABLE 7.7

CMS Quality

Measures as of

December 31,

2014

Measure

Overall rating (1 = lowest, 5 = highest)

Health inspections-number of deficiencies

Nursing home staffing (1 = lowest, 5 = highest)

Total number of licensed nurse staff hours per resident per day

RN hours per resident per day

LPN/LVN hours per resident per day

Certified nursing assistant hours per resident per day

Jasper Gardens State Average

6 0-36

2 '

1 hr 27 min

42 min

45 min

2 hrs 10 min

(continued)

Case 7: Jasper Gardens Nursing Home 255

Measure

Quality measures-Overall

(1 = lowest, 5 = highest)

Percent of long-stay residents who were given influenza vaccination during the flu season

Percent of long-stay residents who were

assessed and given pneumococcal vaccination

Percent of long-stay residents whose need for

help with daily activities has increased

Percent of long-stay residents who have moder-

ate to severe pain

Percent of high-risk long-stay residents who have pressure sores

Percent of low-risk long-stay residents who have

pressure sores

Percent of long-stay residents who were physi·

cally restrained

Percent of long-stay residents who are more

depressed and anxious

Percent of low-risk long-stay residents who lose

control of their bowels or bladder

Percent of long-stay residents who have/had a

catheter inserted and left in their bladder

Percent of long-stay residents who spend most

of their time in bed or in a chair

Percent of long-stay residents whose ability to

move about in and around their room got worse

Percent of long-stay residents who had a urinary tract infection

Percent of long-stay residents who lose too much weight

Percent of short-stay residents given influenza

vaccination during the flu season

Jasper Gardens

100

State Average

·,; ,.

(continued)

TABLE 7.7

CMS Quality

Measures as o'

December 31,

2014

(continued)

256 The Middleboro Casebook

TABLE 7.7

CMS Quality

Measures as of

December 31,

2014

(continued)

Measure

Percent of s�ort·stay residents who were assessed and given pneumococcal vaccination

Percent of short-stay residents who have delirium

Percent of short-stay residents who had moderate to severe pain

Percent of short-stay residents who have pressure sores

Fire safety inspections-number of deficiencies

Formal complaints

Jasper Gardens State Average

97 89

0 2

36 30

6 12

2 0-13

0 2