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Dear Editor;
History
Bloomfield was built in 1962 and quickly became the source for senior and skilled care for the 20,000 residents of the county. There was no competition and the 110-bed facility served the county well. It was profitable and over the years gave money back to the county.
Around 1970 the Mineral Point Care Center was built and it operates 30 beds today under private ownership. Later when Memorial Hospital of Iowa County merged with the Catholic Hospital in Dodgeville they converted the old hospital building into a nursing home eventually moving those nursing home beds to Uplands Hills Health (UHH) where they maintain 44 nursing home beds today. There are now 74 nursing home beds that did not exist in 1962.
In the 80's and 90's assisted living started to take root in Iowa County. Private companies sprouted up. The Grassi home being one of the first assisted living homes. Later Elder Span with Upland Hills began operating an assisted living home as well, known as Crestridge. Sienna Crest, Upland Point, Stonefield and Cornerstone were also added during this time. There are now about 130 beds of assisted living in the county along with the 74 private owned skilled nursing beds. Total beds are 204 (+ or -) privately owned beds that are serving the county in senior (and other) care all were in direct competition with the county's own 50 beds in the recent year's.
Competition
Why did the county bed count shrink, you might ask? Well the county responded to the shrinking share of the market. We could not fill our 110 licensed beds any more. We first reduced to 80 then 65, and finally to 50 in 2021. We had 34 beds filled at closure. These beds are licensed by the state of Wisconsin. The county currently has 50 bed licenses. The way this business works is we are assessed a monthly bed tax of $170 per bed, whether we use the bed or not. That amounts to $2040 per year on an unoccupied bed. 20 beds are $40,800, annually. We simply could not pay tax on unused beds.
There is no such thing as a Medicaid bed (as UHH stated) when it comes to a nursing home. There are licensed beds without a tag on them. The occupant determines the payer source. Medicaid and Family Care under-pay the system by about 40%. Losses are $100 to $130 per day on those beds. $3000 loss per month equals $36,000 loss per year. The UHH letter vaguely referred to Intergovernmental Transfers of money paid to counties to supplement Medicaid and Family Care. This amounts to about $6000 per bed per year, still leaving a $30,000/bed annual deficit. When most of the entity's residents are Medicaid or family care the losses add up. In our case we were losing close to $1 million per year. The solution is to raise the reimbursement rates of all the money streams. I have written every representative about this situation. Nothing has happened.
UHH 2 weeks ago mentioned that they capped their admissions of Medicaid to 25%. They are saying that they need 75% to pay full price for their beds in order to balance the books. They have an advantage of maintaining that payer mix. Bloomfield has been upwards of 60% Medicaid. With only the 34 bed occupants (19 were Iowa County residents) in December of 2021, we did not have enough full-payment beds. When our competitors take the profitable patients, it makes it impossible for us to balance the books without large tax contributions.
Laws and Limitations
State law says we cannot raise the levy more than net new construction. Net new construction means new buildings built within the county valuation. Typically, the increase in revenue runs between 1% and 3% annually. This barely covers reasonable pay increases for staff and increased costs of vehicles, equipment, roads, and energy to run the county.
Merger
We tried to work with Upland Hills on a merged operation in 2014 when it proved to be too difficult, we parted ways only to return to the table in 2018. By 2021 we had a deal in principle until the last minute, when Upland Hills decided to toss another wrinkle in the deal by demanding that Crestridge be bought from them and Greg Griffin for $6.7 million. This would put $3.35 million in UHH's pocket and pay $3.35 million to buy out partner Greg Griffin. But this would leverage the merged operation and leave it with a 20-year-old building. The county's independent analysis showed no economic advantage. We did see the risks of an older building though. But when Uplands Hills Board Chair said it was a "deal breaker" if Crestridge was left out of the final deal, it was time to leave the table.
Tough Decision
From everything that I could gather when meeting with experts, the ideal size for an assisted living/nursing care facility is 100 to 110 beds based on distribution of fixed costs and management costs. In 1962, we had the right size organization. Now we do not.
This has left us operating an old facility with a shrunken market that did not even come close to cash flowing due to a bad payer mix. The 60-year-old building needs new sewer lines which means tearing out almost all the basement floor. The DNR has the sewerage treatment plant on notice for major upgrades. The water flow no longer supports the sewerage treatment plant. The water tower is over 100 years old. The building needs several other upgrades.
The staffing issues of the past year meant we could not staff the facility, so we went to agency staffing at a cost of more than double normal costs. Recently we only had enough staff for 35 patients. When we closed, only 19 of those patients were from Iowa County. We were losing about $800,000 for those 19 patients. Iowa County taxpayers are subsidizing nursing home residents to the tune of $40,000+ per year per patient.
I might add if the merger had gone through, the plan was for 40 skilled nursing beds and 60 assisted living beds. UHH currently has 44 beds. That is 4 more than the merger would have allowed. The future lies more in the assisted living beds as more and more people move in that direction. Summarized, if we merged UHH and the County we were to have 40 skilled beds from the combined 94 beds of the county and UHH. Now since we closed, there will still be 44 beds owned by UHH.
Final Decision
The final decision to close was due to the following items:
• The facility updates that were needed. The old building simply was not worth spending a lot of money on it.
• A new building and an operating levy would add $2 million onto the tax levy (an increase of over 15% to county levy).
• Inability to achieve a fair payer mix.
• Historic losses of $4.1 million over the past 10 years
• Accelerating monthly losses in 2021.
• The inability to find local staffing and the high costs of agency staffing.
• Building costs are up a minimum of 40% according to Contractors.
• Interest rates are on the rise.
• County Nursing homes are not required by law. 38 of the 72 counties in WI do not run nursing homes.

John Meyers
Barneveld, WI