Schenectady County cutting home’s costs

PHOTOGRAPHER: Michael Lamendola

Schenectady County officials continue to find ways to lower costs at the county-owned nursing home as they begin work on its $50.5 million replacement.

The work involves moving approximately 1,450 feet of Hetcheltown Road away from the current Glendale Home to make room for the new facility and making a new sewer connection.

The latest cost-cutting effort involves offering approximately 10 percent of unionized staff at Glendale an early retirement incentive, said County Attorney Chris Garner. The Schenectady County Legislature is expected to approve the proposal at its meeting tonight.

As outlined, the incentive would target full-time Glendale Home employees age 55 and older with at least 15 years of credited service with the county. The pool includes approximately 30 people in the following job classifications: assistant cook, cleaner, food service helper, diet technician, nursing assistant, stores clerk, supervising nurse, licensed practical nurse, maintenance worker, utility worker and laundry worker.

Employees who apply for the incentive between Oct. 1 and Dec. 31 would receive 15 percent of their 2011 base salary, Gardner said. He said the incentive would help accelerate employee turnover at Glendale; the rate there is 10 percent. The county would hire replacements at a salary and fringe-benefit rate that is approximately 20 percent to 50 percent less than the current employee rate, he said.

The savings are the result of a contract signed in July by the county and members of Local 1199, Service Employees International Union, at Glendale. For the first time, the contract established a two-tiered wage system for employees at the home. Starting Aug. 1, new employees are hired at a salary 10 percent lower than the current starting wage. New employees also join the new Tier V state retirement system, which provides additional savings to municipalities. Gardner said the system would save approximately $12,000 per new employee and approximately $1.2 million over three years.

The proposed retirement incentive was not part of the July contract package, Gardner said. He said the county developed the incentive afterwards. “After negotiations, we were looking at ways to get a quick cost savings,” he said.

Gardner said the county expects to recoup the cost of the retirement incentive within several months. The exact savings would depend on how many staff from which job classification take the incentive. The nursing home employs 270 people.

“We are trying to bend the cost curve and make the nursing home more competitive,” Gardner said.

He said the county wants to maintain the nursing home as a safety net for frail elderly while also reducing the county-provided annual subsidy. The subsidy is $4.1 million this year, paid out of the tax levy. It would have been $7 million, but the county received a special reimbursement from the federal government. Gardner said the reimbursement, called an intergovernmental transfer, is not always guaranteed.

As part of its commitment, the county has started work on a replacement for its antiquated facility. By moving part of Hetcheltown Road and making a new sewer connection, the county can build the new facility without having to demolish the old building first. The plan is to complete the new road later this year and open it. Then the existing part of Hetcheltown Road will be closed and removed. County officials said there will be no delays as part of the work.

The new nursing home would contain 200 beds and is scheduled to open in the fall of 2013. It’s expected to operate more efficiently than the current Glendale Home, a hodgepodge of buildings, some dating back to the 1930s. The facility’s annual budget is nearly $30 million.

The county Legislature has authorized bonding of up to $50.5 million for the project, and county officials hope to stay within this figure. The county expects to recoup 85 percent of the cost of construction through enhanced Medicaid reimbursements. Gardner said the remaining $7.5 million would be paid for by increasing the private pay rate to the market rate. Private pay accounts for 11 percent of the coverage at the nursing home with Medicaid covering 85 percent.