In 2011, voters overwhelmingly decided to keep Gracedale, the Northampton County-owned nursing home that originally served as its poorhouse. In an effort to make the aging facility more efficient and cost-effective, the county decided to replace in-house administrators with Premier Healthcare.

That has resulted in improved quality of care, as recently reflected by a zero-deficiency survey recently performed by the Department of Health, a first in forty years. In addition, Premier has been able to vastly reduce the county's contribution. But in an extensive presentation made to the Finance Committee on Feb. 19, Premier warns that the county's annual cost may be as high as $11.5 million by 2018. Moreover, more than $14 million in capital repairs are needed.

This presentation came from D. Freeman, the Premier administrator working at Gracedale. He was assisted by John Belko, Premier's vice president of operations. Freeman did most of the talking.The biggest change under Premier has been a significant increase in residents at Gracedale. The census has grown from 590, when Premier first took over, to a high of 681 at the time of the presentation. The more patients, the more revenue.

Administrator Freeman has also aggressively pursued accounts receivable. There are bi-weekly accounts receivable reviews going through each file. A collections law firm has brought in $1.4 million, and payment plans are in place for some accounts that were written off in the past.

Through effective us of risk management, workers' compensation claims have dropped from $2 million in 2011 to just $166,000 last year.But labor still eats away at 67 percent of the operational costs, compared to an industry standard that varies between 25 and 35 percent. "This is the killer for us," remarked Freeman. He said the facility is about as full as it can be, so that revenue is already maximized. In addition to these high labor costs, the nursing home is at the mercy of declining reimbursements from the state and federal government.

In 2014, Northampton County budgeted $5.85 million to support Gracedale. It spent $6.7 million.