Sell or surrender -- that's the decision Northampton County officials will soon have to make about 37 bed licenses at the Gracedale nursing home, and hundreds of thousands of dollars are riding on the outcome.
A report is due in about a week from the Pittsburgh consulting firm Carbis Walker, which is studying the issue, which was raised Thursday during meetings of county council and council's human resources committee.
Council member Robert Werner framed the question facing the county this way: Should the county sell the licenses and realize a one-time $700,000 windfall, or surrender the licenses and make Gracedale eligible for $300,000 a year in incentives from the state?
Council members Ken Kraft and Tom Dietrich had a different take: Why not both? Why couldn't the county make money selling the licenses and then, with Gracedale's bed spaces reduced from 725 to 688, cash in on the incentives that would bring in the extra state money, they wondered.
Ross Marcus, county director of human services, and council president John Cusick pointed out that it might take a long time for the county to get any money from selling the bed licenses because state has been slow in approving such sales.
"I spoke recently with county council members in Erie, who had a sale [of bed licenses] for a substantial amount of money, and [approval] has been held up by the [state] Department of Welfare for a year now," Cusick said. "If we have to wait a year [for the money], I'm not sure it's worth it."
Cusick said while there is a demand for bed licenses, state officials would like to reduce their number, because the amount of money the state reimburses nursing homes is calculated in part on bed licenses.
Cusick added that while he originally favored selling the licenses, "I've come around to the other side of the issue."
Marcus backed up Cusick's comments, saying, getting rid of the licenses is a way to lower the state's financial obligation to pay for people on Medicaid.
The bed license issue led to a discussion about a recent U.S. News and World Report article called Best Nursing Homes, which used data on health inspections, nurse staffing and quality of medical care from a federal Web site run by the Centers for Medicare & Medicaid Services.
Gracedale received two out of a possible five stars. Cedarbrook, the nursing home run by Lehigh County, scored four stars. (About 23 percent of Pennsylvania's nursing homes and 24 percent of New Jersey's earned a five-star rating.)
When Cusick asked Marcus to respond to the rating, he pointed out that it was based on "limited criteria" and noted the government Web site cautioned people not to exclusively use the ratings in choosing a nursing home.
Council member Lamont McClure said he was "optimistic" that in time Gracedale, too, would achieve a four-star rating, like Cedarbrook, especially with the continuing efforts of Premier Healthcare Resources, the company hired in September 2011 to run Gracedale.
That led to a humorous remark from Marcus that alluded to an earlier council decision to stick with Nazareth Ambulance to provide Gracedale's non-emergency transportation, despite Premier's recommendation to accept a proposal from Lifestar Response Corp. costing $86,556 a year less.
Marcus began by saying Premier is still learning different ways to improve Gracedale. "And if you [council members] continue to support Premier -- no wait, if you start supporting Premier, I'm sure we can get [Gracedale] to three or four stars," Marcus said to chuckles from council and the audience.