Burlington County’s Buttonwood Hospital latest to privatize due to money woes

Buttonwood hospital in Burlington County, N.J., has been providing nursing home and psychiatric care to largely low-income adults for more than a century. On March 1, the county plans to put the facility on the auction block because it has gotten too expensive to run.

History of serving the poor

Many county-run nursing homes up and down the East Coast were originally established to help people like Aubrey Knox, a 53-year-old diabetic who was living on the streets until he moved to Buttonwood three years ago.

“I’m in there first thing for being homeless,” Knox said, “second thing I’m in there because I’m sick.”

Knox is in a wheelchair and needs help getting out of bed, going to the bathroom and traveling to and from kidney dialysis.

The nursing home section of Buttonwood has 170 beds, and 85 percent of patients are covered by Medicaid — that is much higher than the 45 percent required by the state for any home that accepts the coverage.

Cuts to Medicaid reimbursement rates are hitting all nursing homes, and New Jersey’s 2 percent cap on property tax increases is making it harder for counties to make up the difference with public funds.

Budget forcing tough decisions

Buttonwood has been operating at a loss for years.  The county projects it would need $50 million in taxpayer subsidizes over the next ten years to stay afloat. With the guarantee that all current residents be allowed to stay on, last month the county freeholders announced they would put the facility up for auction.

“They have a really tough choice to make,” said Ralph Shrom, spokesman for Burlington County. “You’re dealing with a big constituency that’s basically paying the bill for 500 people who use Buttonwood each year.”

In the last year and a half, Salem, Mercer and Cumberland counties all sold their nursing homes to private companies. Bergen and Sussex counties are both considering doing the same.

Shrom said the factors that led to those sales are now squeezing Burlington County.

“We heard people say, ‘Can’t you cut other places?,’ and believe me, freeholders have looked everywhere,” Shrom said. “In county government there’s things that are mandatory, statutory, you must do, and there are things that are optional. Nursing homes are optional.”

Some see this wave of privatization as a needed shift, but Buttonwood employees frame it as a fresh tear in the safety net.

At a public hearing on the proposed auction, Buttonwood medical director Ken Goldstein begged the freeholders to save the institution, which he said has been instructed for many years to take residents who have nowhere else to go.

“Sometimes these people are living in filth at home, adult protective services is called in, they cannnot believe what they see.” Goldstein said. “If Buttonwood did not exist, I don’t know where this person would go.”

Safety net still intact in Pa., but worries remain

Privatization is not unique to New Jersey. It is also happening in Pennsylvania, where Mike Wilt, executive director of the Pennsylvania Association of County Affiliated Homes, said at least ten county nursing homes have gone private in as many years. He said so far, the safety net has not disappeared.

“Even though they are privatized they pretty much still act like a county facility in who they admit, and the types of residents that they serve,” Wilt said.

Still, if current trends continue, he worries that privately owned homes may start taking fewer Medicaid patients, or be forced to close outright.

“We just wonder out loud if the reimbursement keeps dwindling and costs keep rising, there’s just no happy ending for that equation,” Wilt said. “If you’re a county home, you know it comes back under the county to use county dollars to subsidize it. If you’re a private facility, you don’t have that many options.”

For now, those with loved ones at Buttonwood are not concerned with the next generation of needy seniors. They worry about their family and friends currently there.

Charlie Hoffman, who has good friends in the nursing home, is convinced handing it over to a profit-driven company will harm the quality of care.

“Anybody who’s been in the hospital has seen the type of people. They’re vulnerable, they can’t shop and go elsewhere and see if they can get the type of care they want somewhere else,” Hoffman said. “So it’s up to us to make sure that they get the best possible care.”

The New Jersey Association of Counties is working on a model referendum that would allow voters to create a dedicated tax to fund county nursing homes, one exempt from the 2 percent increase cap.

To date, there are 33 county-run nursing homes left in Pennsylvania and a dozen, including Buttonwood, in New Jersey.