One year after a IndyStar survey, Indiana’s largest nursing home owner, has taken further steps to increase staffing and the quality of its facilities statewide.

Paul Babcock, who took the lead of the Health & Hospital Corp. from Marion County last year, said the public health agency planned to nearly double the amount of money it was spending on its system of 78 nursing homes across the state.

HHC also added two new provisions to its contract with the private company that operates the homes.

The first introduces performance incentives to improve quality in nursing homes. The second requires the company, American Senior Communities, to hire a compliance officer to respond to allegations of illegal or unethical behavior.

Yet these changes do not respond to recommendations from an audit the agency commissioned last year following IndyStar’s investigation and the rise in coronavirus deaths at its facilities.

“Obviously, it’s going to take a while,” Babcock told IndyStar. “It’s not something that happens overnight.”

What the IndyStar investigation found

An IndyStar survey last year, titled “Careless,” revealed how dismal staffing levels have left the state’s roughly 530 nursing homes woefully unprepared for the coronavirus pandemic, despite Indiana’s status as the nation’s largest recipient of additional Medicaid funding for nursing homes.

Indiana is eligible for these additional funds due to a mysterious program that provides enhanced Medicaid funds to nursing homes owned by local government agencies.

Negligent:Nursing home residents suffer as county hospitals rack up millions

County hospitals across the state have acquired more than 90% of Indiana nursing homes – at least on paper – to access the extra money. But IndyStar found that state and federal authorities had allowed these hospitals to divert much of the money for other purposes such as building hospitals.

More than 20 public hospitals across the state – including HHC, which operates Sidney & Lois Eskenazi Hospital in Indianapolis – participate in the program. Together, they embezzle hundreds of millions of dollars every year.

The practice has raised concerns because even before the pandemic, Indiana ranked 48th in the country in total nursing hours. This includes highly trained nurses as well as practical nurses who provide much of the practical work in nursing homes. Staffing is widely viewed as a top quality indicator.

Lack of staff, failed reforms:How Indiana Failed Nursing Home Residents

The human toll has been detailed in inspection reports and malpractice claims involving injuries or deaths that could have been avoided with adequate staff: bed sores left to rot until limbs had to be amputated, repeated falls that left residents with broken bones or fatal head injuries; and violent attacks among unsupervised residents.

And that was before the pandemic. As the virus swept across the country, it killed residents of Indiana nursing homes at higher rates than in most other states, the IndyStar survey found.

The system also enabled widespread fraud. IndyStar investigation revealed a secret report which detailed previously unknown fraud charges involving former American Senior Communities executives and their associates.

Negligent:5 were prosecuted for US Senior Communities fraud. A secret report accuses 20 others.

The report, compiled by American Senior Communities in 2016, claimed that 25 people in nearly two dozen programs defrauded HHC’s nursing home system by at least $ 35 million. Only five of those people were prosecuted and $ 15.5 million recovered on behalf of taxpayers.

Investigation requires review

IndyStar’s investigation and rising death toll from COVID-19 led HHC’s board of directors to order an external review of its nursing homes in May 2020. The agency’s longtime chief, Matthew Gutwein, also resigned in September under pressure from the board of directors.

HHC paid $ 865,000 to the Atlanta law firm Constangy, Brooks, Smith and Prophete LLP to perform the nursing home review. It was completed in April, but HHC did not provide a copy of the review findings to IndyStar until October, despite repeated requests.

Auditors found that HHC had not fully developed or implemented policies and procedures to enforce its contract with American Senior Communities.

“Consistent compliance with all contractual provisions is of crucial importance when one considers that 78 nursing facilities represent a large and multifaceted business operation within a complex and heavily regulated industry,” the 27 report states. pages.

The report also found that pre-pandemic staffing levels at HHC nursing homes were below state and national averages.

“This created operational challenges during the sudden onset of the pandemic, both in terms of access to available employees and the significant financial obligation to immediately adjust staffing patterns due to COVID-19,” indicates the report.

Staffing issues were not unique to HHC, the report notes, “as the entire health sector nationwide has been plunged into crisis management.”

The report recommends that HHC set regulatory compliance and workforce ratio expectations for U.S. senior communities and require the company to notify HHC when these staffing targets are not met.

The report also suggests that HHC should consider spending a larger portion of its nursing homes’ Medicaid funds on staff upgrades.

“An incalculable loss”

Babcock, who replaced Gutwein in September last year, said he was aware of the stakes.

His office at HHC Headquarters at 38th and Rural Streets is relatively unadorned with one exception: a framed copy of the Front page of the New York Times from May 24, 2020.

“Almost 100,000 deaths in the United States, an untold loss,” says the headline.

It’s a reminder of the importance of HHC’s public health mission, Babcock said.

Today, more than 800,000 people have died from COVID-19 in the United States. Over 1,100 of these were residents of HHC nursing homes.

Babcock said he can relate the devastation felt by these families. He lost his own grandmother to COVID-19 last year. She was a resident of a dementia unit at a non-HHC facility.

“The mission, personally, means a lot,” he said.

“I think what this report just shows is that there is always more to be done to improve it,” he said. “And that’s what we’re working on. That’s our goal. It’s our mission. And, you know, patient care is paramount to me and the team.”

More money for retirement homes

But when Babcock took over at HHC last year, the agency was spending less, not more, on nursing home care.

As the coronavirus ravaged nursing homes across the country in 2020, HHC actually slashed the amount of money it was spending on its nursing homes, according to spending information IndyStar obtained via a request for public records.

Although HHC nursing homes generated about $ 186 million in additional Medicaid funds, the agency spent just $ 47 million, or about 25%, on its nursing homes in 2020. The 139 millions of dollars left went to the hospital.

This was a significant decrease from the previous year, HHC spent around $ 65 million on its nursing homes in 2019. It was also a much smaller amount than what the agency had. told Indianapolis city council she would spend on nursing homes in 2020.

Babcock said he couldn’t comment on what the previous HHC administration told the city-county council. He attributed the reduction in spending for nursing homes to an influx of funding from the federal government’s CARES Act.

But he said HHC plans to spend significantly more on its nursing homes this year and in 2020, in a bid to attract and retain more staff.

“In 2022, we plan to put in around $ 80 million to try to make sure we have the right levels in this tough market,” he said.

Recruitment remains a challenge

Raising staff levels will be an uphill battle. Employers in all sectors are struggling to fill vacant positions. This is especially true in healthcare settings. And it’s an even bigger problem in nursing homes in particular, Babcock said.

Average salaries for registered nurses and practical nurses have increased by about 30% at HHC facilities over the past two years, according to information provided by the agency.

However, the numbers continued to decline. HHC did not provide comparable system-wide numbers, but for the agency’s 14 nursing homes in Marion County, the number of nursing home employees rose from 2,138 in 2019 to 1,674 currently.

American Senior Communities is trying to increase those numbers with employees from contracted agencies, according to HHC.

Babcock hopes the continued investment will pay off.

“We are looking at increasing salaries to try to retain staff, potential incentive programs – we are doing everything we can to maintain high staffing levels,” he said. “But it’s just a challenge in the industry at all levels.”

There remains one key audit recommendation that HHC has yet to attempt: establish the required staffing ratios for America’s senior communities.

“Unfortunately,” Babcock said, “due to the difficulty of finding staff, we are not able to do this.”

IndyStar reporters Emily Hopkins and Tim Evans contributed to this story.

Contact IndyStar reporter Tony Cook at 317-444-6081 or tony.cook@indystar.com. Follow him on Twitter: @IndyStarTony.