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Western Minnesota community rocked by closure of nursing home

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The western Minnesota town of Hoffman is coming to grips with losing one of its largest employers.

Last week the final resident moved out of the town's nursing home, following an announcement the home would close in December, due to financial troubles and a lack of qualified workers.

The announcement in October sent shockwaves through the community.

MPR News reports that the loss of 55 jobs and hundreds of thousands of dollars in salaries will be hard for the community to weather.

Hoffman Economic Development Director, Muriel Krusemark told MPR, "We will have to fight to stay alive. We already lost a school. Now we will have two white elephants."

The facility was built in 1964 and purchased by Sioux Falls-based Good Samaritan in 1993. It had the capacity for 54 residents, but because of staffing shortages administrator Bill Brewer couldn't fill the home to capacity. "We knew that at our staffing level, we had to stop admissions at 27," he said.

Brewer told MPR that the home has lost $1.5 million in the last four or five years. He said the facility was on track to lose more than $400,000 this year.

It's not just a problem in Hoffman. Around Minnesota 65 nursing homes have closed since 2000.

President of the Care Providers of Minnesota, Patti Cullen, said nursing homes all over Minnesota are struggling. She told MPR that, "Over the course of years, there has been a squeezing down of the avenues to make it in the black. The underpay of Medicaid is what the downward spiral is about."

Reimbursement rates for residents on Medicaid are between $23 and $30 per resident per day less than actual care costs.

MPR reports that the state has been trying to limit the number of available nursing home beds. By doing that, they are directing more of the elderly toward less-expensive assisted living facilities and have placed a moratorium on new bed licenses.

According to an October 2013 legislative report, from the Minnesota Department of Human Services, since 1987 the number of nursing homes in the state has decreased from 468 to 392. The number of nursing home beds has also decreased from more than 48,000 to under 32,000.

The report also found that Seniors are spending less time in nursing homes. In 1984, one out of every three Minnesotans 85 and over was in a home on any given day. That number dropped to one out of seven by 2011, according to the report.

As for what's next for the building, there's not a lot known yet. MPR says Good Samaritan is offering to donate the building to the city of Hoffman, but it will spread its bed licenses among its other facilities or will put them on layaway for later. That will make it virtually impossible to open another nursing home in town.

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