Financial problems continue for Neighbors of Dunn County
By LeAnn R. Ralph
MENOMONIE — Over the past year, county officials have been seeking solutions to the financial problems of the Neighbors of Dunn County that resulted in financial losses of $1.05 million in 2015 and $750,000 in 2014.
When Dunn County was building the Neighbors of Dunn County to replace the Dunn County Health Care Center, “we thought it would be financially self-sufficient,” said Tony Manzella, nursing home administrator, at the Dunn County Board’s November 15 meeting.
The Tuesday meeting was the annual budget meeting when the county board approves the budget for the following year.
Manzella presented the annual report of the Neighbors to the county board.
Over the past year, CliftonLarsonAllen LLP has been making recommendations to help the Neighbors minimize deficits, he said.
According to financial statements for 2014 and 2015 issued by CLA that are available on Dunn County’s website, in 2015, the Neighbors had an operating revenue of $11.64 million and expenses of $13.02 million.
In 2014, the Neighbors had an operating revenue of $12.34 million and operating expenses of $13.76 million.
In 2015, Dunn County subsidized the difference in operating revenue and operating expenses by approximately $900,000, and in 2014, Dunn County subsidized the difference by approximately $800,000.
The budget for the Neighbors in 2014 also included the last year of $500,000 in revenue from the additional tax levy that had been approved by Dunn County voters during a referendum five years earlier.
According to the budget summary published in the October 23 edition of the Dunn County News, the Neighbors had an ending balance of a negative $4.4 million for 2016.
The Neighbors started out 2016 with a beginning negative balance of $3.8 million.
Because of changes in the Neighbors’ dietary division, the facility will save about $100,000 in 2017, Manzella told the county board.
Some of those changes will include reducing the number of full-time employees due to retirements and adjusting hours worked, he said.
The Neighbors also is expecting to have savings in food costs for 2017, Manzella said.
One tiny bit of good news is that the Neighbors will see a small increase in Medicaid rates for 2017, he said.
Other changes in the “case mix index” (CMI) and in restorative nursing are expected to result in $100,000 to $200,000 more per year in increased revenue, Manzella said.
The Neighbors also has decreased the private pay rate, which has helped the facility attract more residents. The private pay rate is expected to remain competitive in 2017, he said.
The Neighbors has a marketing plan as well that was developed by The Blue Group to help with advertising and marketing the facility, Manzella said.
Marketing will help improve the facility’s census (the number of residents), and if the census can remain at 93 or 94 percent occupancy, the financial challenges will become much more manageable, he said.
Manzella reminded county board supervisors that Wisconsin “is the worst state in the nation for nursing home reimbursement.”
Manzella said he and Steve Rasmussen, chair of the Dunn County Board, had met with Governor Scott Walker recently about nursing home reimbursement rates and also noted that state Senator Sheila Harsdorf is “well aware of the situation.”
Some nursing home facilities in the state are limiting the number of residents that will be accepted because the facility cannot find employees, Manzella noted.
The Neighbors has been able to retain employees at a better rate because of the Certified Nursing Assistant training offered. The Neighbors also works with local high schools obtain employees, and the facility has a resident-centered culture, he said.
