Support the Timberjay by making a donation.

Serving Northern St. Louis County, Minnesota

Nursing homes

Local taxpayers shouldn’t have to make up for state funding shortfalls

Posted 9/25/14

Would you be willing to pay more taxes to keep a nursing home in your community?

That question is being asked in more communities as state reimbursements fail to keep pace with the costs of caring …

This item is available in full to subscribers.

Please log in to continue

Log in

Nursing homes

Local taxpayers shouldn’t have to make up for state funding shortfalls

Posted

Would you be willing to pay more taxes to keep a nursing home in your community?

That question is being asked in more communities as state reimbursements fail to keep pace with the costs of caring for the elderly. According to Aging in Minnesota, reimbursements now fall short an average of $65 per resident per day.

The Cook Nursing Home would have likely closed without the Cook-Orr Area Healthcare District levy, according to the board Chairwoman Judy Pearson. Cook Hospital and Nursing Home Administrator Al Vogt shares her view and said the public has been largely supportive of the levy. A recent survey of 800 residents in the district found that more than 50 percent said they supported taxes that would keep a nursing home in the community.

Ely’s Boundary Waters Care Center may be headed in the same direction. At a recent Ely City Council meeting, Gary Larson, board president for the Boundary Waters Care Center, outlined options for keeping the nursing home financially viable.

The facility has exhausted most of the $900,000 reserve it received from the Ely-Bloomenson Community Hospital and is nearing the end of critical-access funding it received from the state. There is no guarantee that funding will continue beyond the two years approved by state legislators.

Larson said one option would be to enter a program that provides federal dollars for publicly-owned nursing facilities. Because the program is restricted to facilities owned by cities, counties and so-called hospital districts, the city or a joint-powers group would have to establish a taxing district for the nursing home. The district taxes would provide the local match needed to access the federal dollars provided by the program.

It’s an approach more nursing homes — especially those in small, rural areas — have pursued. Nursing homes in rural communities are typically isolated from other facilities, creating hardships for families who have to house seniors in facilities long driving distances away. In addition, small nursing homes can’t achieve the same economies of scale that larger facilities can.

There are drawbacks, of course. In the five years since its levy use and limits were lifted, the Cook-Orr Area Healthcare District has seen its levy increase several times — including a 55-percent hike one year. In the past eight years, the levy has more than doubled.

While that levy also helps pay for the hospital’s operations and capital improvements, the bulk of the funding is used to cover shortfalls from the nursing home.

It’s worth noting that nursing homes are in crisis because the state has failed to adequately increase reimbursements to nursing homes for years. Instead of making nursing homes a statewide priority, legislators and the governor have shifted that responsibility to local units of government. That means that the cost of maintaining these vital services falls onto the most regressive form of tax available. Far better that the state make up that gap through fairer methods of taxation.

The state’s failure to fund nursing homes leaves local communities with increasingly difficult choices. It boils down to whether the importance of keeping a nursing home in your community justifies the added taxes. The Cook-Orr Area Healthcare District has made its choice. It may be Ely’s turn next to face that decision.