The Neighbors of Dunn County showing $4 million cash deficit

By LeAnn R. Ralph

MENOMONIE  — The county’s nursing home, The Neighbors of Dunn County, has a $4 million cash deficit based on money loaned from Dunn County’s general fund to cover expenses.

April Anderson of CliftonLarsonAllen reported on the audit of the county’s financial statements at the Dunn County Board’s September 20 meeting.

The Neighbors continues to have losses and has no cash available, Anderson told the county board.

According to the audit report, The Neighbors had a deficit of $1.19 million in 2013, and experienced a deficit of $751,000 in 2014. In 2015, the facility had a deficit of $1.049 million, and in 2016, the deficit was $870,000.

The desired ratio of assets available to pay liabilities is one or greater, Anderson said.

In 2013, The Neighbors had a ratio of .77 of assets available to pay liabilities. In 2014, the ratio was .55. In 2015, the ratio was down to .25, and the ratio was .17 in 2016.

Like many nursing homes in Wisconsin, The Neighbors, which opened in 2012, has been experiencing financial difficulties.

Wisconsin has the lowest Medicaid reimbursement rate in the nation, and nursing homes are reimbursed for about two-thirds of the cost of care for residents who qualify for Medicaid.

An austerity fiscal policy, the federal Budget Control Act of 2011 which went into effect in 2013, also reduced Medicare payments by 2 percent per year.

The federal Bipartisan Budget Act of 2015 extended Medicare sequestration until 2025 and continues to decrease Medicare provider and plan payments by 2 percent each year.  

According to past reports from Steve Rasmussen, chair of the Dunn County Board and chair of The Neighbors committee, the facility has been working to increase the percentage of private-pay residents.

The Neighbors has hired a marketing consultant who has developed marketing materials for the facility, including a new web page and social media presence, Rasmussen told the county board at the September 20 meeting.

The traffic to the web page has doubled in the last six months, and the next step is to obtain statistics related to how many of the web page visits translate into visits to The Neighbors or the placing of residents at The Neighbors, he said.

The census at the facility is about 87 percent, and while the revenue for The Neighbors is down, the facility also is controlling expenses, Rasmussen said.

Expenditures

According to the audit report presented by Anderson, the county’s percentage of unassigned fund balance to general fund expenditures is high.

At the county level, a desirable percentage of unassigned fund balance to general fund expenditures is between 20 percent and 40 percent, she said.

In 2013, Dunn County’s percentage of unassigned fund balance to general fund expenditures was 61 percent. In 2014, the percentage was 73.1 percent, and in 2015, the percentage was 75.6 percent.

In 2016, the percentage was 77.6 percent.

Dunn County had an unassigned fund balance of $14.7 million in 2015 and in 2016. In 2014, the unassigned fund balance was $14.5 million, and in 2013, the unassigned fund balance was $12.5 million.

Debt

Most counties have a percentage of the debt limit for general obligation debt of zero to 20 percent, Anderson said.

The debt limit is 5 percent of the county’s equalized value.

Dunn County currently has $38 million in debt outstanding, which is 26 percent of the debt limit, Anderson said.

According to the audit report, Dunn County’s percentage of the debt limit for general obligation debt was 29.4 percent in 2013, and in 2014, it was 32.3 percent.

In 2015, the percentage of debt limit for general obligation debt was 29.1 percent.