Lytton Gardens shrinking nursing facility Lytton Gardens shrinking nursing facility (June 11, 2003)

Staff blames state for large deficits

by Bill D'Agostino

Seniors requiring the assistance of a nursing care facility will have 50 less beds in Palo Alto to recoup in by the end of the month.

Struggling to keep their heads afloat, Lytton Gardens -- a nonprofit senior facility located near downtown Palo Alto -- is in the process of reducing the number of beds in its health care center.

The result will be local seniors must endure extended hospital stays before finding a nursing facility to take them for longer-term care, according to Lytton's President and CEO Vera Goupille. Some might even have to move out of the area entirely, she said.

Last month, Lytton announced it was no longer accepting new MediCal patients. None of its current patients who have MediCal, though, are affected by the change although residents who live in Lytton's apartments and have MediCal won't be able to transfer to the nursing facility, as was common in the past.

Restructuring at Lytton's nursing care facility goes deeper than simply the MediCal cuts. Staff has been reduced, including eight employees who were laid off. And the top floor of the nursing unit is being closed to build a new, non-nursing facility that will serve seniors. In total, the number of beds will decrease from 145 to only 94 by the end of June.

"I'm really concerned," said Kathy Espinoza-Howard, the director of the city of Palo Alto's Human Services Department. "It's a major cut to an already poorly served population."

The reason for the changes is multifaceted, Goupille said. The state is requiring an increasing number of nurses per residents this year. Reimbursements from both Medicare and MediCal are decreasing and insurance rates have quadrupled since 2000.

"In a way, our hands are tied," she said. "It's very similar to what the schools are facing."

Every time the state requires an additional .1 hour of nursing per patient, it costs Lytton an additional $250,000, she noted. That has happened three times in the last three years.

"Those are big numbers for a business that runs on a small margin," she said of the increasing costs, which are exacerbating the problems from an already existing nursing shortage crisis.

In the last fiscal year, which ended April 1, Lytton ran on a $1 million deficit out of its approximately $12 million budget. That was on top of a $600,000 deficit the year before. The new changes will try to minimize the shortfall, Goupille said.

On top of that, a law passed in 2002 by Gov. Gray Davis allowed patients with private funds to impoverish themselves, giving money to their heirs, to become MediCal patients, even though they could afford to pay.

"In all other states, this is considered fraud and is illegal," Lytton Gardens Board Chair Wende Hutton said, pointing out that 30 percent of Lytton's private pay patients converted to MediCal after the law was passed. "I consider this another unfunded state mandate."

Any one of these factors could have been managed, Hutton said. But with all of the funding problems, the choice was either to decrease the quality of the 24-hour nursing care or reduce the number of the people served.

"We're not prepared to lower the standard of care," Goupille added. "I hope that there's an understanding from the state that some of these decisions truly impact people's lives."

Nursing care is only one tier of Lytton's service. It serves more than 500 seniors with affordable apartment-style complexes, an assisted living facility and the nursing care.

The need for Lytton's services among the area's booming population of seniors is great and growing.

Two of the brown-shingled apartment complexes downtown recently opened up its waiting list for the first time in many years. More than 300 people applied in the first three days.

E-mail Bill D'Agostino at bdagostino@paweekly.com