After the return of a long dead federal program provided coaxed $2.3 million into Gracedale’s coffers in 2016, Northampton County Council eagerly signed up for another round Thursday.
By an 8-0 vote, Northampton County Council agreed to contribute to another round of the Intergovernmental Transfer program, also known as an IGT. Councilman Mat Benol was absent.
Under the resolution, Northampton County agreed to commit $10.6 million to the program, about $2.8 million more than last year. It was unclear Friday why the county is investing more or expects to see more in return.
Through the IGT program, county-owned nursing homes pool money with the state, which leverages the cash for better Medicaid funding from the federal government. The state then re-allocates the spoils to the nursing homes, which should see a profit on their investments.
The IGT program had been a standard practice for Gracedale and other county-owned nursing homes until Congress phased it out in 1999. During the 1990s, Gracedale consistently ran in the black. It wasn’t until the IGT ended and the state changed its Medicaid funding formula in 2006 that publicly owned nursing homes such as Gracedale began to struggle financially.
“It’s a shame it took … years to bring the program back, because it was sorely needed. It cost a lot of counties a lot of grief,” said Council President John Cusick.
Should the county see a return similar to last year’s, it would almost be enough to plug the home’s projected $2.6 million deficit. State officials could not commit to the program’s future during the 2017 budget process, so Brown did not include it in his projections. County Executive Tom Muller made the same decision in Lehigh County, where Cedarbrook benefitted from approximately $2.4 million in IGT funds in 2016.
“We were happy just to have the program back,” said Councilman Bob Werner. “That money? Wow.”
The program’s re-emergence paid immediate dividends in 2016. Although the county won’t close its books on the year for a few more weeks, county officials acknowledge the nursing home is in better fiscal shape than it has been in years. In November, a cautious Brown said Gracedale may close the year with a $1.6 million surplus, though he has downplayed the possibility.
Aside from the IGT funds, Gracedale also benefitted in 2016 from the sale of 37 excess bed licenses to a skilled nursing facility in Montgomery County for approximately $830,000. The licenses set a cap on how many Medicaid-eligible patients nursing homes and other facilities can accept at any given time. Funding levels, however, are determined based on how many of those beds are filled, discouraging homes from carrying extra licenses.
TShortell@mcall.com
Twitter @TShortell
610-820-6168
Gracedale’s finances improved in 2016 thanks in part to a federal program. Northampton County Council have agreed to participate again this year.
* 2016 county contribution: $7.8 million
* 2016 county return: $10.1 million (net of $2.3 million)
* 2017 county contribution: $10.6 million
