Trends in Long-Term Care - U.S. Senate Special Committee on Aging

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2900 came to us, and they reported they had never seen such a tremendous number of transfers <strong>in</strong> any one parcel of real property. I might also add that we could have chosen any one of a dozen nurs<strong>in</strong>g homes that we have, that have similar or even more complicated flow; however, this one was chosen for the simple reason that it clearly shows, the State department of health's action clearly shows that this rent is wrong. Senator Moss. Now, <strong>in</strong> 1966, you have the green ownership that goes right on, and then that blue branches off above. Does that mean the renter is operat<strong>in</strong>g it as a nurs<strong>in</strong>g home, and the green is simply the ownership? Mr. MOAN. That is right. They own the physical property, but because they have entered <strong>in</strong>to this lease, and they dom<strong>in</strong>ate the nurs<strong>in</strong>g home, because their costs, is a fixed cost, and it is a major fixed cost, and the $100,000 here is a lot of money to put on this one small build<strong>in</strong>g. I have pictures of the build<strong>in</strong>g, which I would like to admit <strong>in</strong>to evidence, and they show a build<strong>in</strong>g, a three-story build<strong>in</strong>g.* Senator Moss. This build<strong>in</strong>g there? Mr. MOAN. That is right. That is the build<strong>in</strong>g, and the other picture shows the back of it, and this is the <strong>in</strong>stitution that we are talk<strong>in</strong>g about, that underwent all of those transfers, and was mortgaged at one time for $1.3 million. Senator Moss. Did you check its assessed valuation? Mr. MOAN. The assessed value is less than $212,000. Senator Moss. These will be admitted <strong>in</strong>to the files. Did you f<strong>in</strong>d violation of law <strong>in</strong> all of this transfer, anyth<strong>in</strong>g that you thought was violation of law? Mr. MOAN. No, we did not f<strong>in</strong>d actual violations of law. This is legal, all of these transfers are legal. It is a perfectly legal operation. There is noth<strong>in</strong>g unlawful or crim<strong>in</strong>al about it. The problem comes <strong>in</strong> that the exist<strong>in</strong>g medicaid reimbursement formula permits the reimbursement based upon a history of all of those transfers, and if the cost of that build<strong>in</strong>g, and the value of that build<strong>in</strong>g was-bore no relationship to its real value, its assessed value of $212,000, after the $250,000 worth of renovations, so that here we have a build<strong>in</strong>g that we know is worth no more than $300,000 <strong>in</strong> 1957, and a build<strong>in</strong>g that underwent $250,000 worth of renovations, that figure is recorded on the State department of health records, the HE-2, and the total of those is much less, it is even less than half of the amount of mortgages that were entered <strong>in</strong>to on that build<strong>in</strong>g. Senator Moss. What was the end effect, if you have it, what was the end effect of the cost figures that comes out at the end of that formula, by reason of the real estate? Mr. MOAN. Well, aga<strong>in</strong>, we don't know exactly how much the State department of health will eventually reduce the rent <strong>in</strong> the future. We have been told, or I was told that the owners said they would no longer be able to operate the <strong>in</strong>stitution, would have to go out of bus<strong>in</strong>ess, because the planned reduction of bus<strong>in</strong>ess would be too great, and would force them <strong>in</strong>to bankruptcy, so what is probably a fairer rent for the build<strong>in</strong>g was allowed, the <strong>in</strong>stitution would be no longer under the medicaid system, and would no longer bear any relevance to how e See next page.
2901 much the reimbursement formula would or would not allow, so we do not know what the sav<strong>in</strong>gs would be. Senator Moss. You say that <strong>in</strong> 1973, they are us<strong>in</strong>g 1973? Mr. MIOAN. They are us<strong>in</strong>g 1973 records to present 1975 reimbursement formula. Now, I have one other chart. I apologize for the number of charts I have used, show<strong>in</strong>g the <strong>in</strong>creases that were permitted on other <strong>in</strong>stitutions when transfers were made. 45-716 0 - 75 - 3
Page 1 and 2: TRENDS IN LONG-TERM CARE 45-716 0 H
Page 3 and 4: CONTENTS 'Page Openin</stro
Page 5 and 6: 2874 First. Our Nation and our Fede
Page 7 and 8: 2876 Senator Domenici, of New Mexic
Page 9 and 10: 2878 (5) Dealings
Page 11 and 12: 88o Did we leave any out? Mr. HoMFI
Page 13 and 14: 2882 Mr. HALAMIANDARIS. May we have
Page 15 and 16: 2884 designed to secure publicity,
Page 17 and 18: 2886 down at that poin</str
Page 19 and 20: 2888 [The letter referred to above
Page 21 and 22: - HE-2 HE-2 OPERATOR'S STATEMENT OF
Page 23 and 24: 2892 Senator Mloss. Now, equity, is
Page 25 and 26: 2894 It is technically at the actua
Page 27 and 28: 2896 However, there are very few, f
Page 29 and 30: 2897 A year later, she sold it back
Page 31: 2899 The cost of the sale was $246,
Page 35 and 36: 2903 There is no change in<
Page 37 and 38: 2905 to perhaps crowd more patients
Page 39 and 40: 2907 Senator Moss. I wonder if, s<s
Page 41 and 42: $23 22 21 I., 19 18 17 16 15 14 2 2
Page 43 and 44: 4duI . LINEN/LAUNDRY COSTS PER BED
Page 45 and 46: 2913 matter, they do act, and they
Page 47 and 48: 2915 Senator Moss. Is that when it
Page 49 and 50: 2917 Food was not covered or <stron
Page 51 and 52: 2919 MS. JARVIS. Yes; I am. Senator
Page 53 and 54: 2921 We went through the rooms, and
Page 55 and 56: 2923 I would like to start with a s
Page 57 and 58: 2925 I do feel that bed rest and th
Page 59 and 60: 2927 Did he do everythin</s
Page 61 and 62: 2929 Rooms that could be used-such
Page 63 and 64: 2931 UNITED STATES OF AMERICA QCong
Page 65 and 66: 2933 submit it, and we will see tha
Page 67 and 68: 2935 No impropriety of any k<strong
Page 69 and 70: 2937 Did I understand you to say th
Page 71 and 72: 2939 made clear we were submitt<str
Page 73 and 74: 2941 Senator Moss. Thank you. I wou
Page 75 and 76: 2943 was married, I thin</s
Page 77 and 78: 2945 Rochdale Park, not known to me
Page 79 and 80: 2947 Dr. BERGu.rAN1. No. not plesen
Page 81 and 82: ado . 2949 Dr. 3EoG31AN. Very rarel
Page 83 and 84:
2951 A couple of housekeepi
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2953 I think we ca
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2955 Congressman KOCH. But give us
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2957 Mr. NAFTALIS. Mr. Bergman, and
Page 91 and 92:
APPENDIXES Appendix 1 LETTERS RELAT
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Appendix 2 BERGMAN FAMILY NURSING H
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1-4 2963 E. Frank Klein</st
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2965 1X. Busincs.s
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2967 includ<strong
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2969 and may be deemed, in<
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2971 On January 31, 1968 First Conn
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2973 Appendix 3 SUBPENAS ISSUED DUR
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2975 UNITED STATES OF AMERICA Congr
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2977 UNITED STATES OF AMERICA iongr
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2981 UNITED STATES OF AMERICA Eongr
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2983 UNITED STATES OF AMERICA onffr
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2989 UNITED STATES OF AMERICA . IIo
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2993 UNITED STATES OF AMERICA Conre
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2997 - UNITED STATES OF AMERICA Con
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3005 UNITED STATES OF AMERICA QCong
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3007 UNITED STATES OF AMERITCA (Con
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3011 UNITED STATES OF AMERICA Ctong
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3013 UNITED STATES OF AMERICA ¢ong
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3015 d. Reason for patient's admiss
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3023 UNITED STATES OF AMERICA Conqr
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3027 UNITED STATES OF AMERICA Conay
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3031 STATE OF NEW YORK OFFICE OF TH
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Appendix 4 LETTER FROM EUGENE HOLLA
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