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Cedarbrook operator outlines future of nursing home

At least one Lehigh County commissioner not pleased

ALLENTOWN, Pa. - On Wednesday night, Lehigh County commissioner Vic Mazziotti was hoping to hear a recommendation from the county administration regarding the future of the Cedarbrook nursing homes, which are losing millions of dollars every year.

He didn't get it, at least not directly.

Instead, Lisa Wilt, president and CEO of LW Consulting, the company that operates the county's nursing homes, began launching into a presentation in response to specifics in another consultant's report about future options for Cedarbrook.

Mazziotti, who chairs the commissioners' Cedarbrook committee, interrupted Wilt.

"Are we going to have a separate presentation from the administration or is this the administration's response?" he asked.

The response Mazziotti wanted was to six options for the future of the nursing homes that were presented to commissioners in April by Complete HealthCare Resources-Eastern, Inc.

CHR's report to the county did not make any recommendation regarding which option it should follow.

Daniel McCarthy, the county's director of administration, told Mazziotti: "The presentation of the administration is to turn it over to Lisa. The response to the CHR report has been put together by LW Consulting. They are here tonight to comment on that CHR report that you heard presented to you some time ago."

Because LW is the managing company for Cedarbrook, said McCarthy, "We think it best that they present it to you because they're on the ground there."

Asked Mazziotti: "So what we're going to hear tonight is going to be the administration's proposal regarding Cedarbrook, is that correct?"

Said McCarthy: "This is the response of the current operator of the facility to the issues raised by CHR." He added the administration is in accord with LW's response.

Said Mazziotti: "I was hoping to hear from the administration whether they reviewed the six options, why they would pick one over another, before we got into specifics about how to go about implementing changes."

The six CHR options for Cedarbrook are:

• Continue existing operations under county ownership

• Implement revenue enhancement - expense reductions

• County builds replacement facility for Allentown

• Lease the facility to new operator (with potential
replacement facility)

• Transfer facility to a community based non-profit

• Sell facility to new operator

If nothing changes, CHR projected Cedarbrook's operational losses will cost the county more than $6 million in both 2014 and 2015 and more than $7 million by 2016.

Last year those operational losses totaled more than $4.6 million, according to CHR.

Wilt said she and her LW colleagues were going to be speaking to Mazziotti's committee about the first option –continuing operation under existing county ownership – and the second—revenue enhancements and expense reductions.

"Those are the two areas we're going to focus on that we believe are the best options for Cedarbrook," she said.

County executive Thomas Muller elaborated after the Cedarbrook committee meeting: "Tonight the people we pay to run the operation and who are skilled in the nursing home business were presenting their position, as blessed by the administration.

Added Muller: "The administration does not support any of the options entailing a change in ownership of Cedarbrook. Doing nothing is not an option. And building a new home is ridiculously expensive. So the option is to improve the situation with enhancements, better marketing and cost-cutting."

Muller said the administration's "formal and final position" on Cedarbrook will be made known when it releases the proposed 2015 county budget in August.

After his committee meeting, Mazziotti said he thought commissioners had requested that the administration respond to the six CHR options.

"If they don't do it, I think our committee should do it," he said. "Somebody should evaluate the proposals."

Responded Muller:"The administration would have no problem with the committee coming to their own position on the six proposals from CHR."

Cedarbrook officials told Mazziotti's committee that they intend to eliminate 11 of the nursing homes' nearly 60 employees in the environmental services department on Sept. 2, to save at least $500,000 a year.

Wilt said some administrative or clerical positions also might be eliminated later this year, because the work those people do manually will be done on computers.

Wilt said she agreed with CHR's report that Cedarbrook "is a little outdated."

She admitted other nursing homes have been renovated and upgraded, which makes it harder for Cedarbrook to compete.

"Everybody in the market has open beds today," said Weil. "It's not like we're the only place to choose. They have a lot of choices amongst all of the facilities, many of which are upgraded, renovated and a little more stately than Cedarbrook."

Ed Keys, interim administrator at Cedarbrook, said he is looking at short-term measures to improve the nursing homes so Cedarbrook "will be a facility of choice for people."

Those short-term goals will include providing "reasonable updates to make the facility more attractive and provide greater appeal to new residents."

He said that includes looking at "what improvements we can make in first impressions."

Keys said he is looking at the possibility of creating a "short-term rehab unit" rather than having short-term residents "scattered throughout the facility."

He said Cedarbrook also may shrink the size of its male dementia unit.

"There's not the demand in the market. We have many more female applicants than male applicants."

Commissioner David Jones asked about the cost of the renovations outlined by Keys.

"We have not had an architect come in and price out some of the ideas we have," said the administrator. But he guessed moving the male dementia unit "would cost thousands of dollars, not hundreds of thousands of dollars." He said the 40-bed short-term rehab unit would cost "far less" than $1 million.

Keys added: "We don't have hard numbers for you. These are wild, ballpark guesses."

Jones made it clear the commissioners are interested in firm estimates. And Mazziotti asked the LW officials to provide commissioners with written copies of the presentations they made to his committee.

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