Gracedale: Ross P. Marcus, Director of Human Services

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In northeastern Pennsylvania, a county institution caused an emotional debate among residents about private versus government ownership.

Gracedale is a county-owned, 725-bed nursing home that sits on 365 acres in a suburban community in Northampton County.  It is one of the largest nursing homes in Pennsylvania and provides services for residents, including physical, speech, occupational, and recreational therapy; onsite audiology, dental, podiatry, orthopedic, psychiatric, surgery, urology, and ophthalmology clinics; dementia units; worship services; hospice services; and respite care.

Advances in care

Gracedale has been part of the community since 1951 and strives to provide the highest-quality care for residents. The nursing home has about 560 full-time employees, most of whom belong to one of two labor unions.

A few years ago, Gracedale changed leadership and hired a new administrator who helped upgrade the facility and modernize some processes.

“When our previous administrator retired, we brought in a consultant who served as the administrator on a temporary basis and exposed us to a different way of thinking, ways to become more state of the art,” said Ross P. Marcus, director of human services for Northampton County. “We had become a little settled in our ways, and the permanent administrator continued in the consultant’s path to upgrade procedures and improve Gracedale.”

The interim administrator also revived Gracedale’s quality-improvement process, working hard to address any citations from the Department of Health surveys. A recent Gracedale survey highlighted the success of their quality-improvement process and the facility’s commitment to care.

Marcus emphasizes the “familial” attitude of staff members toward each other and residents as being a key part of these improvements. Most employees have been with Gracedale for 15 or more years.

“Gracedale is a large part of our employees’ lives,” Marcus said. “It’s not just a job. They get to know residents and do little extras to make residents’ lives more pleasant and enjoyable.”

Challenges of being public

As a government institution, Gracedale faces funding challenges, especially since Pennsylvania, like most state governments, is looking for ways to cut spending.

This challenge affects capital-improvement projects, such as upgrading Gracedale’s aging facilities. Although upgrades have been made, including replacing leaky windows and renovating the HVAC system, Marcus said it is “difficult for government to justify capital improvements, and a nursing home, like any facility, needs constant improvement.”

As with most healthcare facilities, Gracedale also faces reimbursement challenges. Being a public facility, the majority of residents receive Medicaid, benefits that have been and will likely continue to be reduced in the coming years.

Battle for ownership

In late 2010, Northampton County government proposed selling Gracedale to a private company as a result of the state’s efforts to reduce Medicaid expenditures and because of the county’s financial challenges. Benefit costs, reimbursement rates, and state budget issues also factored into the county’s decision to put Gracedale up for sale.

During the debate, some negative comments were made about Gracedale to help justify the sale. Marcus said this was a difficult time for employees, as they heard these comments, and it “affected morale.”

Furthermore, the push to privatize the facility, a revered institution in the community, did not go over as smoothly as government officials had hoped. A heated debate arose within the county over quality of care and the ability for Medicaid patients to continue receiving affordable care at Gracedale. Employees also had misgivings about turning over Gracedale to a private company, as they were concerned about their job security in this difficult economic climate.

The unions and a group of family members of residents organized a petition that resulted in having the question added to the election ballot so the community could decide where ownership should lie. In May 2011, the community voted three to one in favor of keeping Gracedale government-owned. This vote will keep Gracedale under government control for at least the next five years.

“Partly it’s because, what the public listen to?” Marcus asked. “Did we (the government) really make our case persuasively, or did we beat the drum the way the opponents of the sale did? Probably not. It does show to a certain degree how well-respected Gracedale is and how much Gracedale is viewed as part of the community.”

A strong supporter of selling Gracedale, Marcus has strong reasons for why it should have happened.

“I was in favor of selling the facility because of the relatively pessimistic financial outlook for county-operated nursing homes in Pennsylvania because of the separate reimbursement rate for Medicaid, and because Medicaid is such an important part of Gracedale’s financial picture,” Marcus said. “I also saw that private nursing homes in the area had become enough of the Medicaid population that we were secure in knowing that low-income individuals in need of nursing care would be adequately cared for, but the residents of Northampton County have expressed their view.”

Since the voters have spoken, Marcus feels the pathway going forward is clear.

“What we are determined to do is continue operating a nursing home with a high quality of care and a well-maintained facility and will now be looking at ways of reducing the cost and maximizing revenue, “ he said.

To achieve this, Gracedale has issued a request for proposal (RFP) in an effort to find outside management for the facility.

“We are hoping that there are firms that have enough experience with both county and private nursing homes who have ways of reducing costs that we haven’t thought of and ways of maximizing revenue that we haven’t thought of,” Marcus said.

During the election debate, Marcus said that the labor unions, who opposed the sale, promised that they’d be willing to “give back” if Gracedale remained publicly owned.

“So now, it’s time for them to honor those statements,” Marcus said, “because our fringe benefits cost us about double what a private nursing home pays. So a private nursing home’s fringes would be running at about 34 percent of salary. Ours run 68 percent of salary. “

He later added, “Maybe we’ll have to revisit the issue in a few years.”

Mission of compassion and respect

Regardless of ownership, Marcus said Gracedale remains committed to compassion and quality care.

“Our employees are encouraged to treat residents as if they are their loved ones and never lose track of the human element,” he said. “In the Department of Human Services, we are caring for the most fragile among us, and that’s a special responsibility. We strive to always treat every individual in our care with respect.”

-by Patricia Chaney with additional material by Pete Fernbaugh

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