NORRISTOWN Montgomery County senior staff recommended on Tuesday selling the Parkhouse nursing home complex to a Maryland company for $39 million.
If the county proceeds with the sale - which it could do as early as the end of the year - it will be following a trend in Pennsylvania and beyond.
The number of Pennsylvania counties running their own homes has dropped from at least 50 to 26, said Mike Wilt, executive director of the Pennsylvania Association of County-Affiliated Homes.
Franklin County last month agreed to sell its facility to Mid-Atlantic Health Care, the company Montgomery County is considering.
Parkhouse costs the county from $2 million to $7 million a year, in addition to $8.4 million in debt, said county finance director Uri Monson. It serves about 500 elderly and infirm residents, and employs 700 people.
Parkhouse director Melanie McGarry, part of a nine-member panel that reviewed the bids, said she initially feared a sale, but came around after meeting Mid-Atlantic staff and touring the company's facilities.
"I've done kind of a 180," McGarry said after describing Mid-Atlantic's focus on staff morale.
Scott Rifkin, a Mid-Atlantic managing partner, told the commissioners that he would retain Parkhouse's staff, at the same salary and seniority levels. Pension and health benefits would be transferred out of the county system but replaced at comparable rates, he said.
Lisa Mossie, a township supervisor in Upper Providence, where Parkhouse is situated, asked how the company could profit under those terms.
"You're talking about a $47 million operation here. Mid-Atlantic is going to be able to turn it around just through getting bulk purchasing?" Mossie said after the public hearing in Norristown.
Rifkin said the company's costs would be up to 30 percent lower than the county's, allowing Mid-Atlantic to reinvest several million dollars to upgrade the aging facility.
Mossie urged the commissioners not to sell, or to wait until the dust has settled from the implementation of the Affordable Care Act.
Patients and families also expressed concern about the potential sale during an eight-month debate.
Counties have traditionally operated nursing homes as a last resort for the elderly poor who could not afford private care. Studies have found county homes tend to pay higher wages and have higher ratios of Medicare and Medicaid patients to private payers.
In recent years, Medicare and Medicaid reimbursement rates have stagnated while costs and demand have risen, leaving many county-run homes in the red, Wilt said.
"If you have 100 patients and 90 are on Medicaid, there's not much you can do when Medicaid stays stagnant," he said.
County-run facilities also tend to have higher service ratings.
Mid-Atlantic owns 14 homes in Maryland, Delaware, and Pennsylvania. Its five Philadelphia homes have an average of 10 deficiencies - below the state average of 15 and the national average of 21.
One of those deficiencies was serious, resulting in a patient's death.
In March, a man at Care Pavilion in Philadelphia who required a soft-food diet and supervision choked on a turkey sandwich and a mustard packet, according to the Centers for Medicare and Medicaid Services. The agency classified that as an isolated incident and not indicative of jeopardy to other residents.
The commissioners have yet to schedule a vote on the proposed sale.
Source: Philly.com
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