In a 5-0 vote Tuesday, Oct. 10, the Cape May County Board of County Commissioners decided to end the county management of the Crest Haven Nursing and Rehabilitation Center. Beginning on Monday, Jan. 1, 2024, the 180-bed facility will be turned over to Allaire Health Services, a Limited Liability Corporation based in Freehold.
The last few meetings of the Board of County Commissioners have had extensive public comment from the Crest Haven county workers and the AFSCME union that represents them. The workers say any move to privatize the facility will result in lower standards for patient care. They point to up to 84 current employees whose jobs may be at risk in the transition. They argue that the county did not do a thorough job of looking at ways to keep the facility open while remaining a county operation.
From county officials we hear that the nursing home loses money at a level the county cannot continue to subsidize. Reference was made to an analysis by Ford, Scott and Associates, of Ocean City, the county’s auditor, that showed a $6 million annual loss. At other times the public has heard that the deficit at the nursing home facility is $4 to $4.5 million annually. Whatever the number, it seems that taxpayers have been subsidizing the facility for years.
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According to Ford, Scott and Associates, the county was losing
$6 million annual. That is to become a $1.4 million gain.
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The county believes the facility is overstaffed; it is having Allaire pick up the county employees who have not left or found other positions in county employment..
The union argues that the deficit is a result of mismanagement by the county with slow billing, too low rates and not enough marketing to fill even half the beds.
The county claims Allaire has a stellar rating for long-term nursing home care while the union claims the opposite.
Is it prudent to get the county out of the business of running a nursing home? Allaire Health Services, like every business, must of necessity be in business of making a profit. The company must therefore see a way that an overstaffed and underutilized nursing home facility, which has run deficits each year for several years, can become a profitable addition to its other locations.
The county says it will give Allaire one year free rent for the facility. After that year the company will pay the county $1.4 million a year. The county also says that it will arrange for most, if not all, of the existing county employees at the facility to be employed by Allaire.
How does all of that compute with Allaire turning the deficit-ridden operation into a profitable venture? One has to wait and see since no details have been shared with the public at this point.
Is Allaire Health Services the best company to take over the facility? We assume their bid was the best from an overall perspective. We are told four bids were received, two bidders were not considered and of the remaining two, Allaire was the winner.
On quality care, there is an expected dispute over the company’s reputation based on its other sites in the state.
A quick check of the ratings provided by the Centers for Medicare and Medicaid Services shows inconclusive evidence of care quality. The five-star rating system gives Crest Haven an overall rating of three stars prior to any takeover by Allaire. Three stars is said to be average in the rating system.
A comparison to eight locations where Allaire currently runs rehabilitation and nursing centers in New Jersey shows a range of ratings from a four-star rating at it Fallsview facility in Boonton Township to two stars, a below average score, at its Allaire Rehab & Nursing facility in Freehold. Of eight locations in New Jersey, one has an above-average rating.
The county commissioners have made their decision. While back and forth discussions with the union may continue, it is clear that the days of a county owned and managed facility are over.
If one follows the discussion, the county is making two promises. One is that there will be no decline in care standards at the Crest Haven facility as a result of this transition. The second is that the days of taxpayer subsidy of the facility’s operation are over. The people of Cape May County will now see if these promises are kept. Based upon Allaire’s ratings at their other facilities, it appears at this juncture that the county has made a prudent decision, which will save millions of taxpayer dollars annually while preserving patient care.
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From the Bible: A person’s wisdom yields patience; it is to one’s credit to ignore an offense. Proverbs 19:11
