HomeMy WebLinkAbout2013-09-24 Commissioner Minutes
TUESDAY, SEPTEMBER 24, 2013
The Franklin County Commissioners met Tuesday, September 24, 2013, with the
following members present: David S. Keller, Robert L. Thomas and Robert G.
Ziobrowski. Chairman Keller presided and after calling the meeting to order, a Moment
of Silence, and the Pledge of Allegiance proceeded with the business of the day.
On a motion by Robert G. Ziobrowski; seconded by David S. Keller; unanimously
approved to adopt the agenda.
Chairman Keller announced Commissioner Thomas will not be present for the
morning meeting but will be at the next Board meeting. He also announced that any
questions for Mid-Atlantic should be presented to the Board ahead of time.
Kim Wertz provided public comment that she is disappointed with decision to
move forward with sale of nursing home.
Ken Jones provided public comment that he has covered the points over the last
several months on why the Board should not sell the nursing home, but points were
ignored.
Ken Wertenberg, CEO of Mental Health Association said last week he sent a
letter to Commissioners on ideas of what to do with proceeds from sale of nursing home.
He proposed the idea of establishing a Human Services Trust Fund into which this
money could be deposited and used for mental health needs. He provided the concept
paper which is attached and made a part of these minutes. He said the response from
people has been: this sounds interesting, the devil is in the details, would like to see
more about this, and willing to attend committees about this.
Sheri Morgan said she is in support of Mr. Wertenberg’s idea. It’s not our money,
its tax payer’s money. The Board needs to remember all previous generations paid for
this and did this for future generations so the Board needs to make sure money is put
into a trust fund to help future generations.
Sarah Dickey, a retired county employee, said she agrees with Kenny
Wertenberg’s idea. She worked in Mental Health for 20 years and before that for the
State, so she can certainly affirm there are many needs that could be met from a trust
fund. There are real people with real needs that fall in between the black and white area
of regulations.
The minutes of September 17, 2013 and September 19, 2013 meetings were
reviewed. These will be approved Thursday, September 26, 2013.
The Board reviewed Agreements, Contracts and Reports. Chairman Keller
asked for more explanation of Item #5 grant application with PA Commission on Crime
and Delinquency. Carrie Gray, Assistant County Administrator explained the grant is to
include additional funds for the study being done to improve business processes in court
related offices. This will provide additional money for the Public Defender intake worker
process to continue into 2014. The items will be approved Thursday, September 26,
2013.
Continued on page 2
Steve Malesker from C.S. Davison was present to provide a recommendation for
the 2013 Bridge Maintenance Program bid. The low bid was from Keystruct
Construction for a bid amount of $191,348.00 and project cost estimate was $181,912
which is within 5% of the estimate. Mr. Malesker is recommending Keystruct
Construction as the lowest responsible bid. On a motion by Robert G. Ziobrowski;
seconded by David S. Keller; unanimously approved to award the bid to Keystruct
Construction for a total bid price of $191,348.00. This proposal is the lowest responsible
bidder.
Commissioner Thomas joined the meeting by conference call.
Chairman Keller introduced Dr. Scott Rifkin, Mid-Atlantic Health Care who is here
to answer questions of the Board concerning the sale of the Nursing Home. The other
representatives introduced themselves and their history with the company: Scott Potter,
Chief Financial Officer; Jeff Gerillo, Chief Operating Officer; and Michael Mahon, Chief of
Development. Jay Wenger from Susquehanna Group Advisors was also present.
Chairman Keller requested Dr. Rifkin provide background on how Mid-Atlantic became a
skilled nursing home provider. Dr. Rifkin explained how he got started in his medical
practice and other employment. In 2003 he had an opportunity to buy a facility. When
he took over Berlin Nursing Center, Mid-Atlantic corrected issues carefully and
aggressively and today it’s a five star facility and it serves the community well. Since
then they have acquired a number of facilities in Delaware, Maryland and Pennsylvania.
Dr. Rifkin mentioned all the facilities he owns and how out of the five Philadelphia homes
they own two homes have five star ratings and two have four star ratings. He said in this
business they always struggle to find good folks and one question that comes about is
whether they will keep current employees. He said they always buy good facilities. The
care in the Falling Spring building is very strong, management is very strong, but the
building may need some improvements.
Chairman Keller asked Dr. Rifkin to explain why quality of care will remain the
same or improve for residents. Dr. Rifkin explained that they lead with quality of care
and whatever a patient needs they get. They try to provide best possible care. They
have many four and five star buildings.
Chairman Keller said he has a question from Mr. Sheldon Schwartz: how many
skilled nursing facilities do they own and operate and when did they acquire them? Dr.
Rifkin named and explained each facility and where they are at. They have fourteen
facilities and they now have a certificate of need to build a facility in southern Maryland.
Chairman Keller said Mr. Schwartz asked if they ever sold, closed or transferred
a facility. Dr. Rifkin said they have acquired but never sold. They are not in the
business to flip properties.
Chairman Keller asked what their impression was of Falling Spring. Dr. Rifkin
said members of his team went through the building and came out with a good feeling.
Building itself has been taken good care of but it does need a new roof. He said Falling
Spring staff is strong, quality of care is good, has good surveys and ratings are good.
Auxiliary was there roasting hot dogs and they will try to preserve that. Mr. Gerillo said
they were impressed with care provided by staff, auxiliary member’s involvement and the
level of resident activity in the facility, natural light coming into facility, and court yards
were beautiful. They are building a building in Maryland and want to use Falling Spring
as an example.
Continued on page 3
Chairman Keller asked about payer mix. Dr. Rifkin said the Philadelphia facility
is around 90% Medicaid. They want the Medicaid population; it’s the bread and butter of
what they do in the facilities. They do not turn Medicaid patients away ever.
Chairman Keller asked what the average employee turnover was with prior
acquisitions. Mr. Gerillo said the biggest challenge is concerns of the facility and staff.
It’s all about quality of care and putting quality first, can’t stay committed to that if have
turnover of staff. They want to do everything can to retain staff and make sure there is
minimal turnover. Sometimes people have left but they leave on their own accord. Their
retention rate is better than 90%. When they took over Care Pavilion retention rate was
98%.
Commissioner Ziobrowski said one fear expressed by constituents with our
nursing home being there since 1808 that we’re losing an asset. He’s been asked what
happens down the road if the company taking over goes belly up and adults needing
care will not have a place to live or new company will sell to another provider that does
not normally take Medicaid patients. Dr. Rifkin said he’s in it for long haul, he enjoys
and loves what he does. Mid-Atlantic is also doing some creative things since the
federal government is changing the way healthcare is focused now. They are trying to
keep people healthier, national average for people going back to hospital is 25% but
Mid-Atlantic is 10-15%. If someone has a problem they can take care of it. They are
investing in facilities so that they are successful 10-20 years from now.
Commissioner Ziobrowski asked what is future of private nursing home versus
county nursing homes. Dr. Rifkin said there is a move by counties to get out of
business for several reasons. In some counties they are losing their shirts.
Reimbursement versus inflation over 10 years is likely to get worse and not better. It’s
harder for Counties to compete with purchasing and negotiating contracts with providers.
Reimbursement per patient is not going to go up. They need to make money in areas
that never did before. Mid-Atlantic is trying to intervene in medical problems early and
have developed “step-up” units which provide advanced care and act as a step between
the nursing home and the hospital. Dr. Rifkin said the real way to stay stable is to be
fiscally solid, well run, retain great people and put new things in place to create revenue.
Commissioner Ziobrowski asked when they purchased the Philadelphia
properties they used Real Estate Investment Trust (REIT). He would like Dr. Rifkin to
explain how the Real Estate Investment Trust works. Dr. Rifkin said REIT helped them
purchase these facilities and they have a 29 year lease with REIT. REIT has no control
over operations, or healthcare provided. They have no rights at all and it’s similar to
bank financing.
Commissioner Ziobrowski asked who owns Mid-Atlantic? Dr. Rifkin explained he
is the majority shareholder but each gentleman present has invested interest.
Chairman Keller said Mid-Atlantic nursing hours, per patient day, 5 star ratings
and Department Of Health surveys all compared well, how do they maintain high quality
of care without cutting corners. Dr. Rifkin explained the best way to provide great care is
to have good solid business that is ran well, have dollars available to take great care of
residents, and also to not bleed the companies. They have constant construction on
buildings, units being built, they invest in buildings, and invest in staff.
Commissioner Ziobrowski said he was impressed that a private company is
willing to match 5% on retirement for the employees. Why does this benefit him? Dr.
Rifkin said he encourages staff to participate because 25-30 years from now they need a
retirement in place. He fears that his generation is not putting away for their retirement.
Continued on page 4
Chairman Keller thanked the representatives of Mid-Atlantic for their attendance
and participation in today’s meeting, and the press was invited to ask questions of Mid-
Atlantic. Mid-Atlantic responded to several questions from the press.
The Board recessed and will adjourn at 6:30 p.m. to take up the issue of the
2013 bond refinancing.
John Frey and Gregg McLanahan from Public Financial Management (PFM) met
with the Board regarding the re-financing of approximately $10 Million of the 2004 bond
issue. Mr. McLanahan reported that marvelous things happened today when selling
bonds and results were spectacular. The results are in part because feds have moved
away from discontinuing Quantitative Easing III, the way Franklin County is being run,
and the County’s credit rating has been maintained at AA, per Standard & Poor’s. Mr.
Frey informed the Board that today from 12:00-12:15 bids were received through internet
auction by nine different bidders that submitted 69 different bids. Mr. Frey said good
things happened because absolute interest rates came down, spread to index came
down and also due to the excellent credit rating of the County. Mr. Frey reported that
the winning bidder is Fifth Third Securities, they bid 15 times during the auction period
so every time they did they lowered their bid and our savings went up. The payment
agent will be Fulton Bank as before. He said the demand in the market for these bonds
was greater than he expected. Commissioner Ziobrowski asked if the bidders were
aware of the windfall that the County will have because of selling the nursing home and
we will be in more secure financial position than were before. Mr. Frey responded that in
grand scheme of things this wouldn’t affect the bid process, it’s more of a supply and
demand phenomenon. This action is taking 9.4 Million of the 28 Million bond and will
have 19 million remaining. The call date for the 19 million will be in October 2014. With
this lower interest rate will result in a savings of $1,002,394.90 which is 10%. Mr. Frey
thanked Teresa Beckner, Fiscal Director and John Hart, County Administrator for all their
hard work during this process
Chairman Keller echoed the sentiment of Mr. Frey and thanked Ms. Beckner and
Mr. Hart for their hard work on the bond re-finance.
On a motion by Robert G. Ziobrowski, seconded by Robert L. Thomas;
unanimously approved Ordinance #2013-01 authorizing the incurrence of nonelectoral
debt of the County by the issuance of $9,410,000 aggregate principal amount of general
obligation bonds, Series of 2013.
The meeting was adjourned at 7:10 p.m. with a motion by Robert G. Ziobrowski;
seconded by Robert L. Thomas.
FRANKLIN COUNTY COMMISSIONERS
IMF I Health
CONCEPT PAPER
Introduction
Following a bidding process the Falling Spring Nursing Home, operated by the Franklin County government is
being sold to Mid- Atlantic Healthcare for 11 Million dollars. After sale- related expenses and retiring the debt of
the Home approximately 9 million dollars would be realized from the sale. The question of how sale proceeds will
be utilized is as yet unannounced.
In looking at current funding of various human services a combination of sources such as block grant funding,
medical assistance, grant funding and line item funding is utilized. The level or frequency of this funding can be
questionable dependent on different variables such as tax revenue, political climate and competition.
Purpose
A suggestion is being put forth to utilize proceeds to create a Human Services Trust Fund (HSTF) that would
ensure a dependable, perpetual source of funding be available to help meet the needs of those most in need. The
intention of this fund is not to replace existing funding.
The suggested purpose is to:
1)provide funding to fill gaps in existing services not currently funded through traditional state or
county sources;
2) develop and utilize a consumer outcomes data system as a determinate to provide start-up
funding for new evidence-based services to meet identified unmet human service needs;
3)provide funding to meet emergency-based human service needs.
Description
Form and function for this type of fund can vary. Counties, municipalities and school districts in the
Commonwealth have the ability to invest utilizing different fund mechanisms with varying terms and restrictions
or guidelines. Often funds are invested using PLGIT- the PA Local Government Investment Fund which earns
interest. Some counties have funds that are continually refreshed through tax revenue such as the Dauphin County
Public Works Trust Fund that is referred to as an "infrastructure bank" and funded with a portion of gas tax
revenue. York County has a Community Health Fund funded by the Albert S. Weyer Community Health Fund
that provides community health services. Pittsburgh has an Animal Welfare Trust fund funded by both private &
public funds. Many PA counties have Affordable Housing Trust Funds and Public Land or Open Space Trust
Funds. These are funded with public monies. They are overseen by committees of up to 15 stakeholders; mostly
appointed by the County Commissioners. The Commonwealth also has several Trust Funds funded by fees or
taxes &restricted for specific uses. Examples are the PA Children's Trust Fund and the Sport Fish Restoration
Program & Boating Safety Trust Fund. Invested properly this fund could be self-refreshing- the interest or
dividend earned could be invested back into the fund to build up principal for a set number of years prior to
dispersal of funds or the fund could be kept at the initial amount of investment with dispersal ensuing on a yearly
basis. For example, 9 million dollars invested at 1.5% and compounded once annually would produce about
$135,000 for funding purposes.
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Benefits/Anticipated Outcomes
In the current climate, funding has become less than certain. Economic recovery on both a
level have
national and state
been slower than desired. With tax revenues lagging many budgets have been flat funded after the
significant decrease d several Predictions of the resultant impact of implementation of the
Affordable Care Act varies dienceependent upon years the ago.source.Predictio
Anticipated benefits are as follows:
1) The HSTF would provide a dependable source of funding to help meet local needs;
2) An additional level of flexibility with local management and control would be available;
3) A consumer outcomes data system will provide accurate quantitative and qualitative data for planning
purposes.
Conclusion
Whether this particular suggestion or another is ultimately determined to be the best avenue by which to utilize
the proceeds of the sale of the nursing home it is clear that the public has an interest in the outcome and many
have expressed an interest in exploring this idea and a willingness to participate in the process. One suggestion
to do so would be to engage a volunteer panel made up of concerned citizens and local experts to fully examine
all options, making recommendations on various options to the Commissioners much as other existing advisory
boards within the county do currently.
Respectfully Submitted,
A. Kenneth Wuertenberg, CEO
Mental Health Association
September 24, 2013