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Paynesville Press - October 10, 2001

Merger discussions made public

By Michael Jacobson

The possible merger of two long-term care facilities belonging to the Evangelical Lutheran Good Samaritan Society into the Paynesville Area Health Care System (PAHCS) took another step into the limelight last week. The two entities announced that a letter of intent has been signed for PAHCS to purchase the Good Samaritan Care Center in Paynesville and the Hilltop Good Samaritan Center in Watkins.

Administrators from both PAHCS and the Good Samaritan Society met with staff, residents, and families of the two affected centers last Wednesday, Oct. 3, to discuss the history of the merger talks, the reasons for considering it, what still needs to be done and decided, and the possible effects.

Pat Kelly, the regional director for the Good Samaritan Society, told the staff, residents, and families at the Good Samaritan Care Center in Paynesville how the crisis in long-term care - staff shortages, inadequate reimbursement, and empty beds - forced the Good Samaritan Society to look at the merger.

In the face of the crisis, the recurring question has been: How do we survive? The best answer they could find has continued to be a merger with PAHCS.

"We know there's a need," said Kelly. "No matter if people don't want to be in a board-and-care facility, they will need us."

Kelly likened the letter of intent to a purchase agreement for a house, with several additional steps needed before a sale is completed. A final purchase proposal has not been reached and has not been approved by the executive board of either the Good Samaritan Society or PAHCS.

The board of directors of the Paynesville Area Hospital District - the government entity comprised by seven area cities and four townships that owns PAHCS - will hold a special session on Tuesday, Oct. 16, at 8 p.m. to discuss the possible merger.

If all goes well, the merger could be completed and PAHCS could take over the facilities as of Feb. 1, 2002.

Both the Hilltop Good Samaritan Center in Watkins and the Good Samaritan Care Center in Paynesville were running in the red, administrator Tom Kooiman told the Press last December. Finances in long-term care have been tight because the state sets the daily reimbursement rates for facilities who face rising costs in staffing and medicine.

PAHCS operates a 64-bed Koronis Manor and a 30-unit congregate housing apartment facility for seniors, 700 Stearns Place. While the crisis in long-term care has hurt the financial performance of the Koronis Manor, PAHCS' diversification has helped it to remain profitable despite the losses in long-term care. PAHCS also has a 30-bed acute-care hospital, employs nine doctors and has 65 outreach physicians that visit, has six clinics, and has radiology, laboratory, and physical therapy departments.

"By merging the two organizations together, it brings health care services in this area under one umbrella," said Kooiman, who could become the chief operating officer at PAHCS. "This will allow for better coordination of services. I believe both organizations have similar missions and this merger will allow the facilities to move forward to better meet the needs of the residents, staff, and the local communities."

"It's something none of us really wanted to look at," said Willie LaCroix, the chief executive officer (CEO) for PAHCS, "but in the end it's best for residents at Hilltop in Watkins, at the Good Samaritan in Paynesville, and at the Koronis Manor."

PAHCS has applied for a $30,000 grant from the state that will be used to study the facilities and examine the long-term care options, said LaCroix. The long-term care industry has pushed for better state funding to remodel facilities, and this grant money was appropriated by the Legislature in the last session to study such moves.

"What will happen with this facility?" asked LaCroix in meeting with the Good Samaritan staff in Paynesville last Wednesday afternoon. "I can't tell you right now."

One of the underlying causes of the long-term care crisis in the state is an abundance of beds. Minne-sota, as a state, was one of the best supplied for long-term care facilities. But in recent years the trend has been for more in-home care and other types of senior housing that have led to an oversupply of nursing home beds. Empty beds cost long-term care facilities and the state.

The study could look at the need for assisted living in Paynesville and reducing the number of beds. Currently, Hilltop has four beds on layaway, and the Good Samaritan has six. Because of the excess beds in the state, downsizing is rewarded.

Few immediate changes would occur once the merger is complete, but more changes most likely would eventually be made. Some could be minor changes, like improving the efficiency of operation. The study could recommend the need for more fundamental changes .

"At this time, we have no intention but to run the homes as they are now," said LaCroix. "We intend to utilize the staffs that are here."

PAHCS has over 300 employees, and the addition of 110 employees between the two Good Samaritan facilities would increase that to nearly 450 employees. Job losses due to the merger would be rare, said LaCroix.

Kooiman said he supports the merger and believes it is the best thing to do. "I'm behind it 100 percent," he explained. "Now the question is to do it right."

A 16- to 18-member team of employees - half from PAHCS and half from the Good Samaritan facilities - will help with the transition. Kooiman said that he and nursing director Jay Ophoven brainstormed one day about the details needed to be addressed by the merger and came up with a 25-page list.

Ophoven would assume the position of patient care administrator for long-term care in a reshuffled administrative layout for PAHCS. PAHCS is also working on a new administrative plan to prepare for LaCroix's retirement in May 2003.

At the meeting with Good Samaritan Care Center employees on Wednesday afternoon, administrators went over the differences between Good Samaritan policies and PAHCS policies.

In the evening, after two meetings in Watkins, administrators met with residents and their families. One concern was the loss of a stated Christian purpose in changing from a private provider (the Good Samaritan Society) to a public entity (PAHCS). The Good Samaritan Society is the nation's largest not-for-profit provider of senior housing, with more than 240 facilities in 25 states, according to a joint press release last week. The Good Samaritan Society operates in 47 locations in Minnesota.

Kooiman said they have every intention to keep the morning devotions, the Bible studies, the songs, and the prayers at the facilities after the merger. "Spiritual care is a huge part of health care, and there's no reason to stop it," he said.

PAHCS can learn from the Good Samaritan Society's emphasis on spiritual care, according to LaCroix. "I know we're going to grow as an organization," he said. "We're going to have our eyes open. We can take things from you."

The merger would also help PAHCS to afford to hire a full-time chaplain to work in long-term care. Local pastors from all denominations would still be welcome, said LaCroix, but a full-time chaplain would be able to hold services on Sundays and to dedicate more time to counseling grieving families.

A second concern was choice, which proved to be a little trickier. While Kooiman reassured the residents and their families that they would still have choice in long-term care facilities, the choices will be different if a merger is finalized.

Right now, local residents have the luxury of two nursing homes in town run by different entities. In the future, the only local choice will be PAHCS. Residents will have some choice about which facility they want to be in, but this will be subject to their ability.

Eventually, PAHCS may offer different levels of care at each facility. So residents would have more choice about what type of care they need - congregate housing, assisted living, a dementia unit, or a nursing home - but less choice about where they get it, with PAHCS as the only local provider.

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