Portage County – As many of you have heard, the Portage County Board of Commissioners recently decided to begin the steps to put the county owned nursing home for bid to sell it. The beautiful facility, called the Woodlands at Robinson, is a 99 bed facility. The county has struggled for some time to keep this business afloat and compete with private sector businesses. When the nursing home does not bring in enough revenue to cover expenses, the county’s general fund (your tax dollars) make up all of the difference. It was obvious that something had to change.
The first step was to bring new leadership to increase the number of residents and improve the financial picture. The employees of the facility stepped up and worked harder than ever. Beginning in late Spring, the census increased from an average of about 65 residents to more than 85. In spite of this huge success, financial challenges loomed.
The State of Ohio taxes private nursing homes using the “bed tax.” This is a tax that private companies pay per bed, per day, regardless of whether a resident fills the bed. In the State budget, the legislature originally intended to end the counties’ exemption from this tax. Ultimately, we were spared one more year. However, when this is implemented it will cost the county facility approximately $500,000 per year.
The state also reduced the amount of reimbursement that nursing homes receive for Medicaid patients. Based upon the current number of patients, this means a loss of approximately $278,000 per year.
In addition to these challenges, there are expenses and limitations to being a public employer which make it difficult to continue to operate a business which competes with private businesses.
The Board of Commissioners originally decided to pursue turning over the nursing home to Robinson Memorial Hospital. Turns out, Ohio law does not allow a public hospital to buy it. So we spent many tedious weeks looking into the hospital leasing the facility. Unfortunately, the hospital identified approximately $1million in repairs that needed to be performed before they would lease it. The general fund cannot afford this amount. The hospital also could not afford it.
This led the Board to investigate a private company leasing the facility, with ultimate control and ownership still with the county. We then learned that Ohio law requires money to be escrowed because there is still public debt on the building. This would require us to escrow $6.9 million plus interest, for a total of more than $8 million. You need not be a math genius to see that if we could not afford $1 million, we could not afford $8 million.
Now the Board is looking at the final option, a complete sale of the facility. As difficult as this decision has been, all other options have been exhausted and the financial forecast is too grim to continue if we can find a better option. The next steps will likely take through the end of the year, assuming the Board receives an acceptable bid.
It is my personal belief that, if we sell to the right business, this preserves a beautiful facility in the Ravenna area and protects a number of jobs that would be in jeopardy in the county.
