Nursing home, which is losing money, is a part of Porter affiliation debate

MIDDLEBURY — At its first public meeting to discuss a possible affiliation with a bigger health care provider, Porter Medical Center officials last Wednesday answered serious questions about the future of the Helen Porter nursing home, as well as about other aspects of the partnership.
On Aug. 24, the public got its first chance to hear and react to a potential Porter affiliation with the University of Vermont Health Network (UVMHN). It was the first of what figures to be several discussions on how such a partnership might affect Porter’s finances, amenities, employment and long-term future.
As previously reported by the Addison Independent, the Porter board has selected UVMHN from among four organizations that had expressed a willingness to partner with Addison County’s health care hub. PMC includes Porter Hospital, Helen Porter Healthcare & Rehabilitation (nursing home) and 12 physicians’ offices throughout the county.
The PMC board during the next few months will gather more input before deciding whether to pursue affiliation with UVMHN, or keep the organization independent in increasingly choppy financial waters.
Speaking before about 50 people at the Middlebury Regional EMS headquarters in Middlebury, Porter Interim CEO Dr. Fred Kniffin gave a presentation on some of the possible implications of affiliation, and took questions. And some of those questions centered on how a UVMHN partnership might affect Helen Porter, which serves as a nursing home, rehab center and memory loss facility.
Hilary Hatch, a longtime RN at Porter, noted Moses-Ludington Hospital in Ticonderoga, N.Y., sold its nursing home to a large, for-profit organization when it affiliated with UVMHN back in 2010.
“Given the position of the nursing home here, it makes me think that very same thing will happen,” Hatch said.
She also voiced concern about job security for current Helen Porter workers under potential new ownership.
“This doesn’t sound like a position in which you will be able to decide what to do,” Hatch added. “It sounds more like if a marriage is to be made, certain parts of the ‘dowry’ will have to be dispensed with. My concern is that if this is owned by another entity, these Porter employees will no longer be guaranteed the privilege of remaining Porter employees.”
Kniffin conceded that PMC will need to look at “all of its options” when it comes to the 105-bed Helen Porter Healthcare & Rehabilitation. But he added Porter and UVMHN officials believe in the importance of preserving long-term care facilities in Addison County.
“We view it as a core service,” Kniffin said. “We need to maintain it.”
At the same time, Kniffin said “it’s tough to make money in the long-term care business. In fact, it’s tough just to break even.”
He reported that Helen Porter Healthcare & Rehabilitation has been losing money for the past “five or six years.” This year’s loss is expected to be around $2 million, according to Kniffin.
“It’s not sinking the ship, but it is putting a strain on the organization,” Kniffin said of the Helen Porter losses. “We are in fact looking very closely at Helen Porter and how to maintain the high quality (of service) … but turn the finances around.”
PMC officials have discussed the possible fate of the nursing home with UVMHN officials. Those talks have revolved around how to make HPHR solvent. That could mean reassessing the number of beds the facility now offers and making some capital improvements — such as creating more single rooms and putting in air conditioning — to make it more attractive to prospective clients
“In terms of divesting — either finding a company to manage it or finding another company to own it — we are going to look at those options,” Kniffin said. “I should say that’s not really what we want to do. We would have to be presented with a very compelling case from another company to take that kind of action. We would much rather keep it in the family, where we control it and know we can maintain the quality. But we do need to look at that kind of thing.”
Addison County Economic Development Corp. Director Robin Scheu said she hoped an affiliation with UVMHN would result in more of the nursing home’s beds being filled, which would in turn help the facility become financial viable.
During his presentation, Kniffin pointed to what he believes would be some great advantages to affiliating with UVMHN — including having compatible technology.
He noted about half of Porter Medical Center’s patients currently get some of their medical services through the UVM Medical Center, and around half of Porter’s medical staff trained there. Sharing patients currently can cause some bureaucratic delays, he noted, because PMC and UVMMC have different electronic medical records systems.
“So when you go to UVM or Dartmouth or Rutland, they’re starting from scratch,” Kniffin explained. “They are picking up the phone and calling for medical records from Porter, faxing things.”
Through affiliation, UVMHN would foot the bill of upgrading PMC to a compatible “Epic” electronic medical records system, according to Kniffin. And he said UVMHN would also commit to erecting a new medical office building to consolidate four downtown Middlebury physicians’ practices on the Porter campus. Porter currently pays $400,000 annually for rented space for those practices, Kniffin said.
Affiliation would also net Porter cheaper bond rates, lower insurance rates and discounted legal services — reductions projected to save Porter $1 million to $2 million per year, according to Kniffin.
“This is a big deal,” Kniffin said.
Wednesday’s crowd of around 50 people included several Porter physicians, nurses and administrators, some of whom expressed concerns about how affiliation might affect their jobs.
PMC has more than 800 employees. They are divided among the hospital, Helen Porter Healthcare & Rehabilitation, and 12 physicians’ practices throughout the county. Approximately 60 of those workers are providers who would remain PMC employees for 18 months into affiliation, at which time they would transition to the UVM Medical Group, according to Kniffin.
“Wages and benefits won’t change,” Kniffin said. “There won’t be any material impact from affiliation.”
Kniffin believes affiliation would not result in job cuts at PMC.
“There are probably a few areas where you can imagine there might be some efficiencies, and yet other places that have gone through this process, it has not been an area of big savings,” Kniffin said. “I’m telling people that, within the realm of predictability, their jobs are secure.”
Having a vibrant Porter Medical Center would in turn lead to a stable workforce, he said.
“What’s best for everyone’s job security is for Porter to be as robust as possible,” Kniffin said. “In other words, it’s best for us to be as busy as possible.”
He used the example of Central Vermont Medical Center in Berlin as a recent UVMHN affiliate that did not shed any workforce in the aftermath of its partnership agreement.
“They are busier than they used to be; they have not laid off employees,” Kniffin said.
PMC would keep its board of directors following affiliation, and place one of its own on the UVMHN board, which in turn would have a spot on PMC’s panel. Appointment of the PMC president/CEO would require approval from the UVMHN board, which would also have the final say on large purchases, Porter’s annual budget and other major decisions, officials said.
Affiliation would not result in any change in core services for five years, and any change in such services would require “collaborative strategic planning” between UVMHC and Porter, according to Porter officials.
PMC’s “core services” include medical and surgical care, obstetrics, laboratory and radiology, long-term care and rehabilitation, emergency and primary care, women’s health, infusion services, cardiology, orthopedics, podiatry, ophthalmology, otolaryngology (ear, nose and throat), and urology.
“We really want to preserve all the services we currently provide, and would like to add more services,” Kniffin said.
He cited oncology and neurology as examples of services that PMC currently doesn’t offer, but might be able to offer through a partnership with UVMHN.
“We are committed to having oncology here,” Kniffin said.
Kniffin acknowledged people’s concerns about PMC being able to maintain as much autonomy as it can for as long as possible, if affiliation is approved.
“We will work to get the best terms that we possibly can,” he said.
Porter officials reiterated their views on how affiliation could remedy Porter’s financial troubles.
Officials said PMC would have to find significant cuts and/or revenue enhancements amounting to $857,000 in fiscal year 2017, $1.75 million in fiscal year 2018 and $2 million in fiscal year 2019 to achieve a total margin of approximately $8 million and remain independent and financially capable of delivering the services local patients have come to rely upon. But even then Porter would be unable to make necessary investments in new technology and improved facilities, officials said. Affiliation with UVMHN, according Porter officials, would allow PMC to achieve a total operating margin of just under $10 million, a threshold they said would allow the organization to “thrive.”
Some at Wednesday’s meeting asked if an affiliation with UVMHN might provide a convenient path for local physicians to move to UVM Medical Center.
Dr. Steve Koller, medical staff vice president at PMC, said he believes affiliation would not result in a “brain drain,” but rather help Porter in retaining and recruiting providers.
“This will be a good conduit to get people down here,” Koller said.
Kniffin agreed.
“It’s hard for me to imagine a scenario where they would pull a provider out of our community,” Kniffin said. “It seems very unlikely.”
Reporter John Flowers is at [email protected].

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