De­spite un­cer­tainty, Pauls Val­ley holds on to nurs­ing homes

The Oklahoman (Sunday) - - METRO | STATE - BY PAUL MONIES Ok­la­homa Watch

Pauls Val­ley saw its hos­pi­tal close last month be­cause of fi­nan­cial trou­bles. But that isn’t stop­ping the city from hold­ing on to 28 nurs­ing homes that only two months ago it said it ac­quired to save its only hos­pi­tal.

In­stead of ben­e­fit­ing the hos­pi­tal, city and nurs­ing home of­fi­cials say, Pauls Val­ley hopes to un­lock mil­lions of dol­lars in fed­eral funds to im­prove the over­all qual­ity of health care in the com­mu­nity. Spe­cific ideas for spend­ing the funds, if fed­eral of­fi­cials ap­prove the ar­range­ment, are be­ing bandied about, but noth­ing has been de­cided. Among the ideas are a bet­ter am­bu­lance ser­vice and a new ur­gent-care clinic.

De­trac­tors say the pro­posal is be­ing driven more by the de­sire of nurs­ing home op­er­a­tors to in­crease their prof­its. Those op­er­a­tors pre­vi­ously held the li­censes for the nurs­ing homes, lo­cated across the state, be­fore the city took over own­er­ship. A de­ci­sion by the Cen­ters for Medi­care and Med­i­caid Ser­vices is ex­pected by mid-Jan­uary.

Pauls Val­ley’s ac­qui­si­tion of nurs­ing homes re­flects ru­ral com­mu­ni­ties’ some­times des­per­ate ef­forts to shore up lo­cal health care providers whose re­im­burse­ments un­der Med­i­caid have not kept pace with costs. Ru­ral providers of­ten treat larger shares of pa­tients who are old and poor.

In Pauls Val­ley’s case, 10 of the city’s 28 nurs­ing homes have ap­plied un­der the Ok­la­homa Health Care Author­ity’s nurs­ing fa­cil­ity up­per pay­ment limit pro­gram, which would al­low qual­i­fy­ing nurs­ing homes paid un­der Med­i­caid funds to get the higher Medi­care re­im­burse­ment rate. At stake is mil­lions in ad­di­tional pay­ments to nurs­ing home op­er­a­tors, with cities in the pro­gram get­ting up to 40 per­cent of the bonus pay­ments if they put up tax money to at­tract the ex­tra fed­eral dol­lars.

The state’s lat­est ap­pli­ca­tion with the Cen­ters for Medi­care and Med­i­caid Ser­vices for the pro­gram is await­ing ap­proval af­ter of­fi­cials and stake­hold­ers an­swered a lengthy list of ques­tions from fed­eral reg­u­la­tors.

In all, small cities in Ok­la­homa hold the li­censes for 46 nurs­ing homes across the state, part of a tran­si­tion of own­er­ship and li­censes that took hold af­ter con­sul­tants first pro­posed the state’s par­tic­i­pa­tion in the up­per pay­ment limit pro­gram in 2014. The fed­eral govern­ment re­jected the state’s first ap­pli­ca­tion un­der the pro­gram in July 2017.

“The UPL (up­per pay­ment limit) pro­gram gives you ac­cess to new fed­eral dol­lars for the ben­e­fit of qual­ity,” said Ed­die Pa­rades, se­nior vice pres­i­dent with Stonegate Se­nior Liv­ing and one of the ar­chi­tects of the pro­gram. “The nice side ben­e­fit is these cities and ru­ral hos­pi­tals, they can ben­e­fit. No­body is get­ting rich. In the un­likely event we lose round two, we hope that the state has an ap­petite for round three.”

Pauls Val­ley’s to­tal of 28 nurs­ing home li­censes is high­est in the state; Hugo has li­censes for 12 nurs­ing homes. Other small cities with li­censes in­clude Fred­er­ick, Med­ford and Vici, ac­cord­ing to li­cense in­for­ma­tion filed with the Ok­la­homa State Depart­ment of Health. Some of nurs­ing homes are hun­dreds of miles away from the cities that hold the li­censes, lead­ing critics to ques­tion how cities will over­see com­plex health care op­er­a­tions.

Stonegate man­ages nine of the nurs­ing homes owned by Pauls Val­ley. Pa­rades said Ok­la­homa’s Med­i­caid re­im­burse­ment rate for nurs­ing homes is among the low­est in the na­tion. The state re­cently in­creased the daily rate to about $150. The na­tion­wide Med­i­caid av­er­age daily rate is $195. If the up­per pay­ment limit pro­gram is ap­proved, qual­i­fy­ing nurs­ing homes could get re­im­bursed at the Ok­la­homa Medi­care rate, which can av­er­age about $275 per day.

Pa­rades said Ok­la­homa’s pro­gram is mod­eled af­ter one in Texas. Nurs­ing homes in the Ok­la­homa pro­gram have to im­prove on four of the 21 fed­eral nurs­ing home qual­ity mea­sures in or­der to get the bonus pay­ments. Of­fi­cials set­tled on four mea­sures in which the state ranks lower than the na­tional av­er­age: falls, pres­sure ul­cers, use of an­tipsy­chotic med­i­ca­tions, and re­straints. Nurs­ing homes have to show quar­terly im­prove­ments in or­der to get the money.

“It is pay for per­for­mance,” Pa­rades said. “Some peo­ple think it’s a get-rich-quick scheme and there’s mil­lions in ben­e­fits, but you know who ben­e­fits? The pa­tient. We have to prove qual­ity im­prove­ment to earn it.”

If ap­proved, an ex­tra $7.7 mil­lion in Med­i­caid funds could go to nurs­ing homes in the cur­rent fed­eral fis­cal year, with an­other $18.5 mil­lion pro­jected for next year.

Eleven states have done sim­i­lar up­per pay­ment limit pro­grams for their nurs­ing homes, and three other states are ap­ply­ing. Be­cause of the pa­per­work and reg­u­la­tory hur­dles in­volved, Pa­rades said it only makes sense for states with low Med­i­caid re­im­burse­ment rates to en­ter the pro­gram.

Pauls Val­ley Re­gional Med­i­cal Cen­ter closed Oct. 12, with the loss of 130 jobs, af­ter months of fi­nan­cial trou­bles and amid a dis­pute with a for­mer hos­pi­tal man­age­ment com­pany. City of­fi­cials had hoped to use bonus money from the nurs­ing home pay­ment pro­gram to keep the hos­pi­tal open.

James Frizell, Pauls Val­ley’s city man­ager, said the city is still in­ter­ested in pur­su­ing the pro­gram de­spite the hos­pi­tal’s clo­sure.

“If it gets ap­proved, it will be a great pro­gram for our state,” Frizell said in an email. “The pro­gram is 100 per­cent qual­ity-driven, where fa­cil­i­ties will have to demon­strate im­prove­ment to earn ad­di­tional fund­ing. We re­main ex­cited about the pro­gram, and we’re hope­ful CMS will ap­prove it, like they have in other states.”

It’s un­clear how Pauls Val­ley would spend the bonus money if the pro­gram is put in place. But Pa­rades said par­tic­i­pat­ing cities would be lim­ited to spend­ing it on health pro­grams.

De­trac­tors, how­ever, said the up­per pay­ment limit pro­gram is an elab­o­rate way to boost the prof­its of the for­mer own­ers, now the man­agers, of the nurs­ing homes that have ap­plied.

Wes Bled­soe, who runs a pa­tient ad­vo­cacy group called A Per­fect Cause, said the pro­gram sets up mul­ti­ple lay­ers of man­agers, each of which takes a cut of the en­hanced pay­ments.

“What are these cities bring­ing to the ta­ble to im­prove or pro­vide care for pa­tients and res­i­dents in any of those nurs­ing homes?” Bled­soe said. “If oth­ers are re­spon­si­ble, why are these cities even in­volved? That money is sup­posed to pay for care, not some other func­tion the city con­cocts.”

Pa­rades said those con­cerns are overblown and the cities are al­ready es­tab­lish­ing a good track record.

“These cities have owned these nurs­ing homes for 18 months,” Pa­rades said. “Guess what? Not one of them have lost their li­cense. Not one of them has had sig­nif­i­cant fines that aren’t be­yond the nor­mal busi­ness as usual. A pa­tient, a client and an em­ployee wouldn’t know any dif­fer­ence.”


Fred Sikes joins other res­i­dents at Med­i­cal Park West, a se­nior liv­ing fa­cil­ity in Nor­man, for Bingo on Nov. 19. The city of Pauls Val­ley owns the nurs­ing home.

Ok­la­homa Watch is an in­de­pen­dent in­ves­tiga­tive and in-depth re­port­ing team that part­ners with news or­ga­ni­za­tions across the state to pro­duce im­pact jour­nal­ism in the pub­lic in­ter­est.

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