Monday, July 20, 2009

Who Knew HHC Owned A Chain Of Nursing Homes

It's called the Health & Hospital Corporation of Marion County, but it operates nursing homes throughout the State of Indiana. Huh? That's right. I discovered that HHC owns and operates dozens of nursing homes in places like Anderson, Brownsburg, Evansville, Lafayette, Mooresville, Wesfield, Noblesville, Ft. Wayne, South Bend, Valparaiso, Bedford and Franklin. At the same time HHC went on buying spree of at least 23 nursing homes, it recently closed Lockefield Villages, a nursing home it built in the 1990s adjacent to Wishard Hospital, one of about ten it operates within the county. The Star's Dan Lee explained the closing just months ago:

Wishard Health Services is closing Lockefield Village Health and Rehabilitation Center, a restructuring and cost-cutting move that will displace the 178 residents of the Downtown long-term care facility.

Dr. Lisa Harris, chief executive of Wishard Health, said the move will allow Wishard Health to focus on the growing need for acute and primary care services. Wishard, operated by Marion County Health and Hospital Corp., is a nonprofit hospital and health system that cares for many of the region's poor and indigent.

"Closing Lockefield Village, while a difficult decision, will allow us to focus resources on our core mission," Harris said this week in a Wishard memo.

Lockefield Village, which opened in 1996 at 980 Indiana Ave., has stopped admitting new patients and plans to cease operations by May 13. The facility's residents include stroke and Alzheimer's patients and others who require skilled nursing care.

Wishard said it is working with American Senior Communities, an Indianapolis-based nursing home provider, to help place Lockefield Village residents in other locations.

Dr. Harris' claim that it was closed to focus on the growing need for "acute and primary care services" rings hollow when it has extended its nursing home acquisition to every corner of the state. Lee's story indicated that HHC had no plans for the vacated Lockefield Village, even though we now know just months later that HHC planned all along to swap property with IU to build its new Wishard Hospital facility at a cost of at least a quarter of a billion dollars. Although HHC's CEO Matt Gutwein has boasted about the productivity and quality of care at Wishard, Lee's report notes that Lockefield Village scored just 1 out 5 possible star on its Medicare rating. Virtually all of the residents at Lockefield Village were Medicaid/Medicare patients. [Go to the State of Indiana's interactive map to locate the various nursing homes owned by HHC]

In a short period of time, HHC has been converted from a Marion County-only provider of indigent care and enforcer of the county's health and building codes into a statewide provider of health care services. Did I miss some public discussion where it was decided that HHC should broaden its services statewide? It is hard for me to appreciate how its mission is furthered by owning a nursing home in Bedford or Ft. Wayne. It's difficult to gather any real information about how these decisions were made by the HHC's Board of Trustees because the Board's minutes have such abbreviated statements about issues it discusses. An October, 2002 minute entry exemplifies the brevity of these discussions:

Mr. Elwell began the meeting by discussing the possibility of HHC purchasing certain assets and acquiring certain leases for nursing homes in the State of Indiana. Leah Mannweiler, from Krieg DeVault, outlined for the Board the reimbursement issues involved in such a transaction. Discussion followed.

Mr. Elwell outlined the plan for the first acquisition and explained HHC hoped to acquire more nursing facilities through December 2003. The Board asked about potential liabilities associated with these transactions and asked about an exit strategy. Discussion followed. Mr. Elwell noted that this meeting was to explain the general idea behind the transactions and informed the Board that they would receive more detailed information at the next Board meeting on October 15, 2002.

The Board gave approval for Mr. Elwell and staff to further pursue the purchase and acquisition of certain nursing facilities and asked him to report back to the Board, with more detailed plans, at the October 15th Board meeting. Discussed followed.
At the following meeting in November, 2002, there is this brief enty concerning approval of nursing home purchase agreements:

Ms. Hebenstreit next presented, "Resolution No. 11-2002, "Purchase of Assets and Acquisition of Leases." Mr. Gutwein asked if there was a motion to approve the Resolution. Mrs. O'Laughlin made the motion to approve. Dr. Bock seconded the motion. Mr. Gutwein asked if there was any discussion on the motion. There was none, therefore Resolution No. 11-2002 was unanimously approved.
If you hadn't read the minutes from the meeting the month before, you would have no idea that the "Purchase of Assets and Acquisitions of Leases" involved nursing homes. I see nothing in the record that discussions were held with the City's Mayor, City Councilors or County Commissioners to seek their input before going on a buying spree of nursing homes outside Marion County. Where were the public hearings? There is simply no transparency in the actions of HHC's Board of Trustees. Hidden from public view, it has been converted into a statewide corporate health care giant. Why does it need these nursing homes? Is it bilking Medicare/Medicaid dollars from these nursing homes to finance its big corporate hospital center in Indianapolis? Who knows.

This is just one of the many issues I plan to raise in the coming months as voters of Marion County are asked to approve construction of this new hospital to replace Wishard Hospital. Something doesn't add up when HHC officials tell the public it can borrow all of this money and not raise a dime in taxes to pay for it. A big hat tip to the Advance Indiana reader who brought this matter to my attention. Keep the tips rolling in, and I'll be happy to share with everyone else.


artfuggins said...

Let the nursing home profits build the new Wishard.

Sir Hailstone said...

Let's say just for the sake of argument that Wishard's building is in fact falling apart and not a result of management allowing maintenance (or not spending the money for maintenance) to go the he**. I've seen this mentality over in the Land of Lincoln with schools. If the school boards quit maintaining schools, the voters will approve building us a new one.

The timing couldn't be worse in this case. Here the federal government is proposing a massive revision in the entire health care system, with a likely increase in federal government dependence for health care finance. We have no idea what the final product will be of said legislation even if any Representatives or Senators bother to read it (that is if it passes). What if under the new federal system that health care reimbursements across the board are lowered to the levels that Medicare currently pays? Is there a guarantee from the federal government of a set amount of revenue for what would be mostly traumatic injury and indigent care?

Any revenue projections the HHC is doing now might as well be tossed out the window with this federal reform on the horizon.

I assume the rhetoric with HHC claiming "no taxpayer money" is used to pay these bonds is similar to what the Airport Authority used to sell us on the new terminal - "No taxpayer money" but we pay for it through increased fares. Granted we don't have a government program paying for our airfares. We could, however, soon have a government program paying for our healthcare. If the federal payments for services rendered at the new hospital fall short of present projections then what? a HHC bailout??

Yeah. That's what I thought.

Paul K. Ogden said...

This is an absolutely unbelievable revelation, Gary. The fact that these muni corporations have been allowed to operate without hardly any oversight is evident from the fact I bet that not a single member of the Council knew what HHC was doing owning these nursing homes throughout the state.

I would have to wonder though whether laws have been broken. As a muni corp, the legislature has granted health and hospital certain authority to carry out a mission. That mission does not include owning nursing homes throughout the state, I guarantee you.

I can't thank you enough for breaking this story.

Paul K. Ogden said...

Gary, look at IC 36-1-4-18. Thatstatute limits the power of a "muncipality" which, includes a municipal corporation, to 4 miles outside its corporate boundories. That 4 mile limit statute specifically includes the powers municipal corporations have to acquire real and personal property (IC 36-1-4-5) and to develop, maintain, etc., that property. (IC 36-1-4-6)

I just don't think it's legal for HHC of MC to just go around the state purchasing nursing homes. Of course, HHC employs B& know they would fail to look up the law would they? FYI, that was written with sarcasm.

Septly said...

What I find to be "amazing" are the the strange insinuations by the author and the bizarre comments left so far. Artfuggins, you left an unintentionally intelligent comment. The HHC owns a chain of nursing homes largely to be able to fund its LEGAL mandate to provide indigent healthcare. The plan IS to build a new Wishard without raising taxes. Do you know that the nursing homes the HHC owns are cash cows and that these profits WILL help build a new Wishard by allowing the bonds issued to be paid off? Also, the fact that the HHC owns nursing homes is no state secret. Anyone who pays attention to their local government rather than writing gossip-monger blogs would ALREADY know the HHC owns a chain of nursing homes. They are discussed at public meetings and the Star has in fact reported this fact before in various other articles. Of course, it comes as a "revelation" to the clueless. I can always rely on Hoosiers to live up to my expectations to be some of the most stupid, paranoid people on the planet. Nonetheless, I still have confidence that enough people in Marion County will see the light and pass these bonds to get a much needed new facility built. I will personally work to help get this measure passed through, whatever it takes, and I know so will many other community members. When you have that kind of determination behind you, you are unstoppable.

Gary R. Welsh said...

Septly, you describe the nursing homes as being cash cows. I've spoken to private nursing home operators who complain about the difficulty in turning a profit these days. Census counts are down at many nursing homes because of policies pushing people into alternative care and inadequate Medicare/Medicaid payments to cover actual costs.

Paul K. Ogden said...

Septly, what authority does a Marion County Municipal Corporation have to buy nursing homes all over the state?

Unknown said...

Paul K. Ogden said...

Septly, what authority does a Marion County Municipal Corporation have to buy nursing homes all over the state?

6:53 AM EST

IC 16-22-8-6
Creation; powers
Sec. 6. (a) There is created in a county containing a consolidated

city a distinct municipal corporation known as "The Health and Hospital Corporation of _________ County".
(b) The municipal corporation, in its corporate name, may do the following:
(1) Sue and be sued in a court of competent jurisdiction.
(2) Enter into contracts.
(3) Acquire and dispose of real, personal, and mixed property by deed, purchase, gift, grant, devise, lease, condemnation, or otherwise.
(4) Make and adopt appropriate ordinances, regulations, orders, rules, and resolutions.
(5) Do all things reasonable or necessary to carry out the work and perform the corporation's duties under this chapter.

IC 16-22-8-37
Territorial extent of corporate powers
Sec. 37. The powers, authority, and duties conferred on the corporation and the corporation's officers and employees under this chapter extend throughout the county and may extend outside the county on terms and conditions the board prescribes that are consistent with this chapter.

Anonymous said...

Gary, not everything is a conspiracy in Marion County. I know how much you despise Bob Grand and I don't blame you one bit. But, as a former Wishard employee and someone who still gets his health care at Wishard, i can tell you that the need for a new facility is a no-brainer. And no, the other hospitals in the county cannot absorb the 120,000 ER visits annually. 100 year old hospitals simply cannot provide care effectively. You may not need Wishard, but those who do and those who are saved by the world-class trauma and burn teams are sure thankful Wishard does what it does. I'd be happy to show you around the facilities sometime and you can see firsthand why the need is so great. Look not at the lawyers and politicians, Gary, look at the tens of thousands of patients and 4200 employees who need Wishard.

Paul K. Ogden said...

Thanks D, I'll look it up. The only problem first blush is that I could not find anywere in the set of statutes I cited that muni corps in Marion County were excepted out. Therefore, the 4 mile statute could still apply to HHC-MC unless there is a specific statute in the chapter you cite that says the 4 mile rule doesn't apply to a Marion County muni corp. Just the fact that it isn't listed in the Marion County muni chapter (which I'm assuming it isn't) wouldn't necessarily mean the legislatures intent is the 4 mile rule doesn't apply to Marion County.

jabberdoodle said...

Thanks for bringing this into the daylight, Gary. I would like to know how this fits into their budget - income and expense. I cannot say that I have heard any discussion on this nursing home investment at the Council's muni corp committee hearings on H&H budgets. I must be one of Septly's condemned.

Regardless, it does seem a stretch for it to own Homes outside of its treatment area. Those cannot be claimed as adjunct to their core mission.

Septly said...

Oh, the paranoid continue in imagining phoney violations of law and in criticizing a public institution for actually finding a way to raise revenue WITHOUT raising taxes. It is really amazing, usually this blog and its readers gripe about public institutions always running to the taxpayers for extra funding (nevermind that they ARE taxpayer-supported institutions...), but here we have an institution raising significant funds to help support itself and this blog thinks its a conspiracy worthy of a James Bond novel. The nursing homes are investment properties. The HHC is duly authorized to own investment properties located outside of Marion County, and in fact, it is not the only municipal entity to own real assets located outside of the county it serves. Also, I would refer individuals back to its state authorizing statute cited by "D" which gives the HHC very broad authority to "do all things reasonable or necessary to carry out the work and perform the corporation's duties under this chapter." Owning investments which produce funding to support its core mission most certainly would fit within this last broad grant of authority. But, here's the final nail in the coffin for to any claim of a supposed violation of law: Please read Indiana Code 16-22-8-37

"Territorial extent of corporate powers
Sec. 37. The powers, authority, and duties conferred on the corporation and the corporation's officers and employees under this chapter extend throughout the county and may extend outside the county on terms and conditions the board prescribes that are consistent with this chapter.

Septly said...

So, just in case my last comment got clipped. I want to again post the clear and unambiguous grant of authority in the state law which specifically allows the HHC to operate OUTSIDE of Marion County:

Indiana Code 16-22-8-37

"Territorial extent of corporate powers
Sec. 37. The powers, authority, and duties conferred on the corporation and the corporation's officers and employees under this chapter extend throughout the county and may extend outside the county on terms and conditions the board prescribes that are consistent with this chapter."

There is no conspiracy. There is no violation of the law. I would like to see Advance Indiana acknowledge this.

Gary R. Welsh said...

Septly, I've never questioned the legality of owning the nursing homes. I don't think that a taxpayer-supported nonprofit created for Marion County residents should be engaged in competing against other nursing home owners across the state. Clearly, they have a big advantage over privately-owned nursing homes because of their tax-exempt status, leveraged with the tens of millions in direct cash grants it receives from the government annually. Every time they purchase another one of these nursing homes, they take it off the property tax rolls and the income tax rolls.

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