MAYVILLE - Cost-cutting savings for the Chautauqua County Home are "feasible," Don Pryor of the Center for Governmental Research said in a memo sent to the County Legislature.
The letter, originally sent to legislator John Runkle, R-Stockton, and obtained by The Post-Journal, summarizes six cost-cutting and revenue enhancements identified by in a CGR report. Many of those recommendations have been questioned regarding their veracity.
"There were some questions about the report and the savings it identified," Runkle said. "I asked CGR if they could come back and let us know how they came up with their numbers."
The $80,000 CGR report identifies almost $2.3 million in savings and revenue enhancements. Those recommendations were dissected during a recent ad hoc committee meeting in Mayville. Some savings could be realized, said Tim Hellwig, County Home administrator. Other savings, meanwhile, were "overstated," he said.
Pryor's memo, however, solidifies the CGR report.
"It looks like Don is sticking to his numbers," Runkle said. "We have heard some counter assumptions about the savings."
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"All we wanted to do was get all the information," Runkle continued. "At least we have some alternatives (to selling the home)."
WORKERS' WAGES
Two significant savings for the County Home include its workers' wages and benefits - neither of which, however, can be discussed due to the state's Taylor Law. CSEA Unit 6300, which represents home workers, and the county currently are at an impasse with a new labor contract.
Regardless, Pryor's report projects a net 1 percent increase in wage adjustments for County Home workers between 2012 and 2013, and a 2 percent increase from 2014 to 2015.
"These would represent smaller increase - and thus savings - compared to initial County Home projections," Pryor said.
Even with the Taylor Law prohibiting discussions outside the bargaining table, the savings are feasible, Pryor notes.
"... Many of those who shared their views as part of the study process suggested a willingness to consider wage adjustments as a condition for keeping the home under county ownership," he said, adding that $280,000 could be saved annually if a new deal was struck.
LIMITS ON BENEFITS
One of the biggest opportunities for savings is with County Home workers' benefits, which are currently upward of 70 percent of wages. Pryor said scaling back benefits to 60 percent of wages would help the home's bottom line.
"... Our assumption is that significant savings are possible if the county and union are willing to negotiate such benefit reductions," Pryor said.
Savings are projected near $650,000 annually if recognized, although the CGR report notes that existing contractual obligations will make any reductions difficult.
ELECTRONIC MEDICAL RECORDS
Other savings opportunities include implementing an electronic medical record-keeping system, which the County Home lacks. Pryor said a broad EMR system would "lead to much more complete recording of all support services provided, and thus an enhanced ability to capture all reimbursable services."
Pryor also noted that services supporting Activities of Daily Living were "significantly underreported," with lost revenues upward of $50 per resident a day in some instances.
A fully functioning EMR system could net the home an annual savings of $500,000 to $650,000.
"The potential increased revenue would require aggressive training and monitoring at all nursing and supervisory levels," Pryor said, "but we believe this is absolutely doable with such a commitment."
However, according to Hellwig, the County Home Administrator, savings from an advanced EMR system isn't likely to bring in significant savings.
"I find the projected cost savings of $500,000 to be fairly significantly overstated," he said during the ad hoc committee.
PLANNED ATTRITION
Pryor said planned attrition should net the County Home $225,000. He said the CGR report took into account savings included in the home's 2013 budget.
"Having savings already factored into the budget for next year as part of wage savings is excellent news, and an indication that these are realistic savings," Pryor said.
Savings for planned attrition do not include reducing call-in absences, added use of substitutes, reduced overtime and better scheduling techniques.
"... We chosen not to include such savings in order to err on the conservative," Pryor said.
PAYER MIX
The CGR report said the County Home could see enhanced revenues from an improved payer mix system, with potential for $425,000 in additional revenue a year.
But because the home has a significantly higher rate of Medicaid residents, which brings in a lower reimbursement rate, the potential for revenue has been questioned.
In fact, Hellwig said bringing in Medicare and private-pay residents would be difficult, given the fact that the home is near full capacity.
"When we're full, we're full," he said, pointing out that almost 75 percent of County Home residents are on Medicaid.
But Pryor said revenue enhancements are possible in the admission process.
"We argue that it should be possible to shift the mix somewhat of the payer sources of new admissions," Pryor said, adding, "it should be possible to generate at least the additional revenue we projected in the report."