Casa Olga in Palo Alto to close intermediate-care facility

State cuts force intermediate health care facility out of business

Casa Olga, the iconic residence for nearly 9,000 seniors and disabled persons over more than 35 years, will close in a matter of weeks, owners have confirmed.

The eight-story building adorned with the giant mosaic of El Palo Alto at the corner of Emerson Street and Hamilton Avenue is the latest victim of state budget cuts and a bureaucracy that delayed payments for services to patients for six months or longer, according to its owners.

Weary of the struggle with government and now in their 70s, the four partners who built and managed the building since it opened in 1975 have finally given up and will close the intermediate health care facility in the coming weeks. All 88 residents will be moved to other facilities, homes or will be returned to the care of their families, Wanda Ginner, a board member and co-owner, said.

Casa Olga is the only free-standing intermediate health care facility on the Peninsula and serves disabled and elderly persons from throughout the county and surrounding counties, including San Mateo, she said.

Intermediate health care facilities were created in the early 1970s by then-Governor Ronald Reagan, who wanted a less expensive tier of care for disabled persons who are classified as "ambulatory" and were then residing in costly nursing homes and skilled-care facilities, according to Walter Harrington, co-developer of Casa Olga with his late partner, Alexander Kulakoff.

People with debilitating conditions -- including kidney failure and heart failure -- and treatable mental illness who can function in the surrounding community and walk on their own are eligible for the program. They receive housing, laundry service, three meals a day, activities, assisted-care from nurses and doctors, medication supervision and visits from psychiatrists and psychologists.

But ironically many at Casa Olga will now face placement in the more costly nursing homes, Ginner said.

Casa Olga -- which was named for Kulakoff's teenage daughter, Olga, who died suddenly as plans for the building were being drawn up -- began struggling two years ago, Ginner said.

The state slashed payments for services to Casa Olga's parent company, Care Centers Inc., by 10 percent on July 1, 2008 -- a loss of $250,000. On March 1, 2009, the budget cuts were reduced to 5 percent, but that reduction meant Care Centers received $150,000 less annually.

Out of an annual budget of $3 million, $2 million went toward payroll and $1 million covered everything else for patients, which includes three meals a day, laundry services and all other expenses, she said.

A year ago, Care Centers wrote two letters to the California Department of Health Services protesting the 10 percent cut but received no reply, she said.

Department of Health officials could not be reached for comment on Friday, which was a furlough day due to state budget cuts.

Where full-fledged skilled-nursing facilities receive approximately $160 a day per patient from the state, intermediate health care facilities such as Casa Olga receive only $90 but must still provide nursing care, doctors and many of the same services, she said.

"We were just barely breaking even. The owners went two years taking no profit ... but they weren't going to put up that kind of money," she said of the $150,000 deficit.

"The long-term prospect was horrible. We went through our cash reserves and didn't have a lot of choice," she said.

Ginner estimated nearly $250,000 the state owes Care Centers in back payments will finance shutting down the four floors comprising the intermediate health care facility. A plan was approved by the state Department of Health Services on Aug. 14. Two floors of single-room-only tenancies (SROs) will remain, she said.

Ginner said the future use of the four floors has yet to be determined. The four partners are working with Palo Alto developer James Baer to come up with the best financial solution that would also benefit the community, she said. They might decide to convert other units to SROs, she said.

Baer was not immediately available for comment on his ideas for the site.

Harrington said the building could contain as many as 78 suites for younger people in need of a downtown location, or perhaps be available to Stanford students.

Ginner said Care Centers would work with the city to determine future use, which could include retail on the bottom floor, if that is what the city determines is best for the downtown community.

"I promise you it will not be a massage parlor," she said.

But one of the hardest things for Ginner and Harrington will be the layoffs of as many as 70 employees, they said. Some have worked for Casa Olga for 20 years.

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Like this comment
Posted by Resident
a resident of Another Palo Alto neighborhood
on Aug 21, 2009 at 5:03 pm

This is really sad for the residents. The place is a bit of a dump, but it is home for many who need it. I just hope this does not put them out on the streets with other mentally ill people who have nowhere else to go.

Like this comment
Posted by R U Ready America?
a resident of Midtown
on Aug 21, 2009 at 6:25 pm

This is how costs are cut. I hope everyone is paying attention. In France, the elderly and disabled just stay with their families to the breaking point, until the caregiver or the originally ill one needs to be actually hospitalized for weeks. Are you ready, America?

This is disgusting.

Like this comment
Posted by Dave
a resident of another community
on Aug 22, 2009 at 2:46 am

These taxpayers should have saved up! We need government funds to pay for services for "undocumented residents"

Like this comment
Posted by resident of another community
a resident of Mountain View
on Aug 22, 2009 at 1:33 pm

Cash in care stops when cash stops to come in.This is the beginning of the end.

Like this comment
Posted by Speed Cushion
a resident of Another Palo Alto neighborhood
on Aug 22, 2009 at 2:39 pm

I will miss the daily ambulances.

Like this comment
Posted by Sam
a resident of Mountain View
on Aug 22, 2009 at 2:49 pm

Sad to say this will only put more medical and mentally ill patients [who Need treatment], out necessity, forced to live on the streets.

Our government needs to fund wars, other countrys, space programs, politians pork programs than help our own needy;

BTW those residents more than likely paid taxes for years before they became afflicted.

A dimming example of our state taking care of their own citizens.
But isn't that the way of budget cuts....
First cut are the helpless, schools, the elderly and the sick...
way to go arnold....
strange how it is they can keep building bigger and better prisons.

alsoBTW over 80% of the people locked up for crimes are done so because of alcohol and drugs, as well and the ones returning to jails.

Treatment for addiction, another medical issue, is not very accessible or affordable to most Americans, who normally are unable to help themselves.

However, that corner is Prime Palo Alto real estate, just think of the amount of restaurants, condos, shops, offices, and boutiques that space could hold, and citizens won't have to look at the disenfranchised either. I guess it would help PA's image much more if the facility was not there.... yea, let's just get them out of sight from that potentially money making corner.

We can build magnificent weapons to kill other people,
but can't do much to help our own people who paid theirs taxes
for years and years. sad state of affairs.

We can fund immigrants [who have Never paid taxes here] with our tax dollars, but can't help those, or their families, who have lost blood or life for our country.

So kids, when you get old, sick, or helpless, you will be abandoned as well. Yes, it will happen to you, no matter how many dollars you paid in taxes to fund the government. Look where the money goes for Social Security. Which was originally designed to help the aged, retired, survivors, and disabled.]

Sad in a county, read County, that has made so many wealthy beyond their dreams!

"They should have saved up"....[see other post]
If you can't afford to 'save up' especially in our roller coaster economy.... you're in trouble; what if there is nothing left to 'save up' after raising your kids, and keep having to pay such High Prices just to live, go to work, and Eat.

You get left to be disenfranchised... homeless and hungry.. We feed {and kill} a good portion of the world; but can't help those who paid their taxes to fund this mess we call a government. I am pro-American without question, but screasm in terror at the way we treat our own taxpayers.

It is Not someones fault that they are old, sick, or disabled.

God Bless America, it needs it!

Like this comment
Posted by Paul
a resident of Downtown North
on Aug 22, 2009 at 5:54 pm

It's either this or higher taxes. Score another one for our Republican minority.

Like this comment
Posted by Kate
a resident of Duveneck/St. Francis
on Aug 22, 2009 at 8:27 pm

Do I understand that we the people are paying for an apartment for Victor Frost??? And we have a multimillion $$$ "Opportunity Center"? He lived there too. This city has mixed up priorities.

Like this comment
Posted by Mom by Gunn
a resident of Green Acres
on Aug 22, 2009 at 10:21 pm

No, Kate..the people in San Mateo County are paying some of Victor Frosts'portion...and that includes the RICHES people in the WHOLE UNITED STATES that live in that County..ATHERTON. CHUMP change for them.
Why are you so worried that someone actually is paying attention and making programs for the homeless...? Seems you have priorities in the wrong place........

Like this comment
Posted by Sun and Sand
a resident of Embarcadero Oaks/Leland
on Aug 23, 2009 at 1:54 pm

This is very sad, and very telling. Ultimately, cultures are judged on how well they manage the care of their most unfortunate members. Someone wrote, above "America, are you ready?" That's right on. We are now at a crossroad in America; if this continues, the so-called "revolution of hope" that Obama was supposed to represent will turning point only insofar as it represents just another empty promise. Those who have finally had enough, and have the ability to invent productive social policy will take over. My take: we ain't see nothin', yet.

Like this comment
Posted by Mike
a resident of University South
on Aug 23, 2009 at 3:54 pm

9000 over 35 years. How many people does he facility hold?

Like this comment
Posted by Mike
a resident of University South
on Aug 23, 2009 at 3:55 pm

D'oh! That should read, "How many people does THE facility hold?"

Like this comment
Posted by Jim H.
a resident of Duveneck/St. Francis
on Aug 23, 2009 at 6:01 pm

"Out of an annual budget of $3 million, $2 million went toward payroll and $1 million covered everything else for patients, which includes three meals a day, laundry services and all other expenses, she said."

Could that be the problem? Actual expenses for those 88 people was only $11K/person, the rest of it was being paid to the workers/doctors/etc..

Like this comment
Posted by sad
a resident of Another Palo Alto neighborhood
on Aug 24, 2009 at 10:12 am

I'm sorry for the people that have jobs there, will they get retirement benefits?

Like this comment
Posted by Crescent Park Dad
a resident of Crescent Park
on Aug 24, 2009 at 10:35 am

@ Sam: you cannot lay all of this at Arnold's feet. It all started when Reagan cut federal funding for mental health facilities in the early 80's. Further, the CA legislature (both sides of the aisle) have just as much responsibility, if not more, as anyone else.

This issue has been looming for over a decade - and yet the legislature could not (would not) find a way to balance the budget. Instead they chose to spend beyond their means. Try doing that at home and see what that gets you.

I'm surprised this mess didn't materialize years ago.

Like this comment
Posted by patricia
a resident of Another Palo Alto neighborhood
on Aug 24, 2009 at 11:10 am

NO retirement benefits for the people that work here.

Like this comment
Posted by Mike
a resident of Crescent Park
on Aug 24, 2009 at 12:08 pm

Seems to me from the report that the owners were about $100K annually short of break even. What if PA had given them a bridge loan for a year or two to reach better economic times-rather than give all $500K to the Senior Games?

After all it is a matter of priorities.

Like this comment
Posted by LHARPER
a resident of another community
on Aug 26, 2009 at 2:39 pm

I would like to say that my mother is here at Casa Olga , they have done wonders for my mother , before she would not eat , would not take her medicine , she is now very happy and takes her medicine , and she eats , the staff has done a very good job , you see my mother has had mental illness scince i was 10 years old , i'm now 46 years old to see her doing this well bring me great joy .

Casa Olga and staff

Like this comment
Posted by Norm
a resident of Midtown
on Aug 26, 2009 at 4:39 pm

Some of the comments are so lacking in understand the problem, so lacking in compassion, it makes me want to puke.

One of the more revolting is one that seeks to drag the Frost issue and the Opportunity Center into the mix. The poster obviously has a personal axe to grind. Personally, I think they should find a personal place to store it.

There is a chance some of the Casa Olga resident will end up on the street.

Unnormal things happen to unstable people in situations they feel are awkward. They will do unusual thing to regain, seize control over their life. Sometimes it’s the ultimate take away. Some it’s shun outside controls. For some, the only control is a constant, repetitive state of “NO” to any and all of anything.

Some posts allude to families taking over. If there were a family with the space, the funds, and the desire – would that person need to live at Casa Olga? If they were trying to hang on to some dignity, self-respect, self-esteem, probably so. If they have not family, it’s a moot point.

I have to shake my head and chuckle at the naiveté of a few posters who have zero grasp of who they believe they are talking about. Taxpayers, saved up. Are you in need of a mental health assessment?!

Some folks at Casa Olga, through no fault of their own, haven’t worked a full-time job, or any job, in their life. How, from what, were they supposed to save anything??

Does anyone else see a Warhol painting of dollars melting into dimes????????????

Multiple layers of government bureaucracy melted the funds these folks subsisted off of from dollars to dimes. The federal grants filtered through the state to off-set gaps between Medi-caid and SSI were munched on by admin costs (for good or bad, admin people need jobs too), so the State, with an added admin expense, was tasked with the difference. The small dog (the State) lost the fight, and now the puppies need a home.

What strikes me as interesting is that in a number of current and past posts related to Lytton Plaza, there is a reference to the ”scary” people panhandling who are “homeless” and driving people away because of the horrors of the Opportunity Center. The OC is a mile further away than Casa Olga, and many unhoused people find them as discomforting as “real” folks do.

Where and how the Palo Alto residents (yes, some of you hate the idea, but – hey, greet you dog as he greets his buddies) find a place, displacing others is not the best idea. (Regardless of your thoughts about those who are actually housed stabler then the others are.)

I am really uncomfortable with the idea that those who believe they know the answers (in spite of ignorance of the real questions) are going to get hyperly energized to call for action when they have no idea what to do………………….

Solutions only, please! Answers are easy – answers are crap. (i.e. find other housing = answer; who pays for housing regardless of where = answer)

Pardon me for playing on Kennedy legacy, but the day pulls at it –

If a free society cannot help the many who are poor, it cannot save the few who are rich.
John F. Kennedy (1917–63), U.S. Democratic politician, president. Inaugural address, 20 Jan. 1961, Washington, D.C.

To balance, the SSI funding that housed many of those folks was a Nixon legacy (1974), And funding for locally run mental health and related programs (including homeless) was Reagan.

Maybe more later. Process is wearing.

2 people like this
Posted by Kate
a resident of Crescent Park
on Aug 26, 2009 at 6:01 pm

As Margaret Thatcher once stated: "The problem with socialism is that eventually you run out of other people's money [to spend]."
Guess what - Palo Alto is out of other people's money to spend. Get used to it. Those with means are moving.

There is a limit to the public dole. The Opportunity Center was sold to the residents of Palo Alto as a fix it for just this type of problem. Way to go Opportunity Center.

Like this comment
Posted by Josh Walker
a resident of Downtown North
on Aug 26, 2009 at 6:39 pm

Let's see... "Pardon me for playing on Kennedy legacy, but the day pulls at it –"

Pulls at it? The phrase is "desperately scratching at the roof to survive," as in how Mary Jo Kopechne tore her fingernails out trying to survive as the last bubble of air left the car, along with Teddy, already swimming away to meet with his operatives to decide how to save his career in case Mary Jo did not survive. Perhaps his habit of downing a fifth of scotch a day helped Teddy be such a good liberal. I would like to believe he reformed, and that the scotch was a sign of his own recognition of the terrible crime he committed. But he never paid for that crime, and the Kennedy legacy is all about crushing the witnesses to that crime. I wonder if he was not struck down by the cancer at the end of his days he would finally confess and give a true apology not contaminated by political considerations. [Dumb liberals unfamiliar with New England maritime expectations must be instructed: the crime was not so much getting drunk while married and killing a party girl in a DUI, although even true Democrats usually grant that is a crime if one gets caught. It was the unforgiveably unmanly fleeing of the scene, the failure to not leave the scene no matter what so long as the girl was trapped below. No lobsterman, no farmer, no true resident of the Cape will forgive him for that crime.]

Like this comment
Posted by Norm
a resident of Midtown
on Aug 28, 2009 at 3:26 pm

Norm is a registered user.

Gee, Josh, I didn't mean to twang on a raw nerve bring to mind Mary Jo Kopechne through quoting JOHN Kennedy from an address he made BEFORE his goofy little brother - who everyone has said did not live up to his brother's legacy - drove off a bridge several years after John was dead.

Kate - you have, again, mirepresented the funtion/role the Opportunity Center. It was not intended to serve as an "intermediate health care facility" and could not, if they even wanted to, get approve to operate as one. What would you have the OC do "as a fix it for just this type of problem" even if they were allowed?

Like this comment
Posted by Daniel
a resident of Los Altos Hills
on Sep 12, 2009 at 12:21 pm

The owners are turning the building into apartments for Stanford students. It's all about money in the pockets for Walter Harrington and Wanda Ginner. This is their golden opportunity to put it off on funding problems. Not true.

Like this comment
Posted by Just change the subject
a resident of Crescent Park
on Sep 12, 2009 at 7:53 pm

It seems there is no subject so remote that the rightwingnuts can't bring up something irrelevant. This week it's Teddy Kennedy's misdeeds. It's understandable that they would rather do that than grovel in the disgrace the Republicans produce almost daily now.
Josh, what do you think about the Republican legislator bragging to a colleague about spanking+sex with a lobbyist that appears before him, and cheating on her with another one? Quite a prince, I'd say. Or the Florida legislator who solicited sex from congressional male pages, or... well, I won't go on, Kate might have a quote from Maggie Thatcher to make it OK.

Like this comment
Posted by grimmy
a resident of East Palo Alto
on May 3, 2011 at 4:15 pm

Kate, those most on the public dole are federal govt employees. Including benefits, they make TWICE what their equivalents in private companies make.
For example a janitor or clerk working for HP would make half the money of a federally employed janitor or clerk.

Like this comment
Posted by robert jarvis
a resident of Old Palo Alto
on Jan 13, 2013 at 6:50 pm

I was a student artisan on the mosaic mural.

Sorry, but further commenting on this topic has been closed.

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