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Editorial

October 1, 2004
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In Praise of Profit Makers by Richard L. Peck, Editor-in-Chief
editorial

BY RICHARD L. PECK, EDITOR-IN-CHIEF

You might have noticed that articles on "how to choose a nursing home" have become an editorial staple in the popular media. The writers usually recount the experiences they've had visiting various types of facilities and offer guidelines for selection. One thing I've noticed with somewhat startling frequency in these stories: a suggestion that people choose not-for-profit facilities.

I suppose that's easy to understand on the face of it. Not-for-profits have an obvious mission focus, and from this the implication is drawn that they are more committed to quality service than to strict bottom-line performance. A further implication is that facility owners committed to profit making tend to take it out of residents' hides.

That happens, no doubt. And, I have to admit, I've often had to think twice about respecting the profit motive in connection with such a basic service as healthcare. If looked at a certain way, it seems to be putting a price on human life. I have another bias, though-a soft spot for entrepreneurs who lay their money (borrowed or otherwise) on the line to create a business, accept the risk of failure, and are rewarded directly by the market when they succeed. They are, in my view, a breed apart-that is, with the appropriate business focus.

There's the rub. Profits, and the businesses that generate them, can be looked at in a couple of ways. First, they're a way of keeping score, of answering the question "Who's the big winner here?" But another, and I think better, way of looking at them is that profits are a sign that the proprietor knows his or her business, understands customer satisfaction, and knows how to get the word out. The philosophy is, do your business right, and profits will follow.

Needless to say for this audience, the long-term care business poses some special challenges. There is the heavy reliance on government funding (and therefore pricing), the growing intensity of resident need and public scrutiny, and the responsibility of supporting some of the most vulnerable members of our society. Taken altogether, this just might not be the field for profit maximization. Some decisions might have to be made that are less than optimal for the bottom line.

But some profit makers are finding a way. A case in point is this year's OPTIMA Award winner, Kings Harbor Multicare Center of the Bronx, New York. This for-profit organization created a massively coordinated anti-falls program, despite the lack of specific Medicare/Medicaid reimbursement for this type of effort. As experienced administrators know, third-party payment is not geared toward prevention. Kings Harbor administrators say they implemented this program simply to provide good resident care.

Perhaps this is the kind of trade-off that goes with the territory in for-profit long-term care. But that doesn't rule out for-profit care; if anything, it makes the good providers all the more admirable and worth patronizing.

So, much as we admire the mission-oriented, quality-minded not-for-profits, let's not rule out the profit makers in identifying the best nursing homes. Let's look at the real bottom line: resident care that meets people's needs.



To comment on this editorial, please send e-mail to peck1004@nursinghomesmagazine.com.
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