Nursing home closure rocks small town of Hoffman

HOFFMAN, Minn. – The rooms at the Hoffman nursing home were empty, the last of 27 residents having packed up and left earlier in the day. A vacant bird cage stood in the corner of the dining room, its leased canaries returned to their owner. Televisions, stacks of bed sheets, piles of medical equipment, books, holiday decorations and even a high-tech, $20,000 bathtub had been spoken for or soon would be. In the resident rooms, blank name plaques at the doors, push pins randomly dotted the walls, once having held family photos, posters and drawings.

Photo gallery: Small town says goodbye to its nursing home

“It started to echo in here two weeks ago and I hated that,” said Bill Brewer, the Hoffman Good Samaritan Society center's administrator for nine years, who also runs a nursing home in nearby Glenwood. He poked his head into the hair salon, with bare purple walls and a few askew dryer chairs. “We just finished this last year,” he said. “We didn’t have a beauty salon.”


Since the announcement in early October that this facility would close because of financial troubles and the inability to hire enough staff, the Hoffman nursing home had been losing residents one by one as they found beds in other towns. Many of the 55 full-time, part-time and on-call people who worked here have also moved on.

The closing of the nursing home, completed last week, has sent shock waves through this town of 700 west of Alexandria. For years, the city has been fighting to remain economically vital and has been held up as an example of how energy and ideas can revitalize a small community facing economic and demographic challenges. Muriel Krusemark, Hoffman's economic development director, has helped usher in new businesses on Main Avenue like a plumbing and heating shop, an updated grocery store with a café and a gift boutique. “In the morning, there will be 20 cars on main street,” she said. “I count them on my way to work.”

Hoffman economic development director Muriel Krusemark called the nursing home a blow but she vows to carry on her mission. (Ann Arbor Miller for MPR News)

But the loss of 55 jobs and hundreds of thousands of dollars in salaries that regularly circulate through town will be hard to weather. Add the nursing home to the list of small-town institutions that give a place its identity but can also fall prey to larger trends in health care, education or the economy. "We will have to fight to stay alive," Krusemark said. "We already lost a school. Now we have two white elephants.”

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The nursing home was unsettlingly quiet last week—like a sprawling, recently vacated house—except when you got to the nurses’ station, where a handful of staff members were busy packing records, answering the phone and trying not to cry. “It was home,” said Jelene Backman, a nurse here for almost 30 years. “The day room was full on a lot of Wednesdays and Thursdays. The coffee pot was always on.”

“It’s a horrible thing,” she said. “People can’t sleep at night. People don’t know what we had here.” At that, Backman started to cry and another staff nurse, Kallie Quernemoen, stepped up to give her a hug. “I love you,” Quernemoen said.

In the hallway near the nurses’ station, a bulletin board listed all the former residents and the nursing homes they had moved to. Most went to towns nearby, the majority to a home in Barrett, seven miles up Highway 55. But for people in their 80s and 90s—many with health problems including dementia—even short moves can be tough.


“It’s very hard on elderly people to be moved,” said Vange Anderson, who ran activities and volunteer and spiritual care services at the Hoffman nursing home for a decade and was on duty when the final resident left. “Especially when they think this is their last destination before heaven. We had several who were well over 90, several who were over 95.”

When the announcement was first made that the nursing home would close in 60 days and everybody had to find new homes, Faye Giese walked into her mom’s room and found her sitting with her eyes clamped shut. “I said, ‘What are you doing?’ She said, ‘I’m praying I’ll die before I have to leave here.’ I was trying not to cry to keep her upbeat. But she meant it.”


Giese talked with her 87-year-old mother, Jeanne Gunderson, for a couple of hours. At the end of their talk, her mom asked her to find a bed in nearby Barrett. “Mom wanted to be as close as possible because I’m busy and if she was too far away, I wouldn’t be able to come see her very often.”  Giese and her family run a corn and soybean farm near Hoffman.

Now, Giese has to drive farther to see her mother. But with the move complete, her mom is starting to like Barrett. “They are getting quite a few from Hoffman up there,” Giese said. “They are all her friends. She likes everybody. She likes her room. She loves the food.”

Still, Giese doesn’t think the closure was very humane. “The Good Samaritan Society was founded by this Reverend (August) Hoeger in 1922,” she said. “It was named after the parable in the gospel of Luke. The motto was, in Christ’s love, everyone is someone. I don’t think he meant everyone but people at the Hoffman Good Samaritan Center, and in Hoffman.”


It wasn’t cruelty that closed the Hoffman nursing home, though, but untenable financial circumstances. The facility, originally built in the 1960s and purchased by Sioux Falls-based Good Samaritan in 1993, had a capacity for 54 residents, or 33 with more private rooms. But because administrator Bill Brewer couldn’t draw enough staff, despite spending thousands of dollars on advertising, he couldn’t fill the home to capacity. “We knew that at our staffing level, we had to stop admissions at 27,” he said.

That made it harder to balance the bottom line. “We lost $1.5 million in the last four or five years,” Brewer said. The facility was on track to lose more than $400,000 this year . “Good Samaritan sustained it longer than most organizations would have.”


Many in Hoffman blame Good Samaritan management and policies for the closing. “There is a lot of anger,” said Backman, noting that the staff pushed for changes but got nowhere. One big hurdle was staff pay, which started for some positions at around $10.00 per hour. “It’s been hard to keep the staff because the state won’t adequately reimburse us,” Backman said. “We went five years without raises.”

“They blame me and that’s fine,” said Brewer grimly. But he said decisions about pay were made further up the ladder. He tried to get raises for a year before they finally came through last spring. “But I didn’t get the OK… I wish we could have given salary increases sooner, but it wasn’t my call.”

Dan Hanson, Good Samaritan’s director of operations for western Minnesota, blames federal and state Medicaid patient reimbursement rates, which were frozen for several years before getting a bump last legislative session. “The payment rate is set for every facility by Medicaid,” he said.

Nursing homes are having trouble all over the state, according to Patti Cullen, president of Care Providers of Minnesota, an association representing hundreds of nursing homes and senior housing and hospice facilities. “Over the course of years, there has been a squeezing down of the avenues to make it in the black,” she said. “The underpay of Medicaid is what the downward spiral is about.”

She said reimbursements for nursing home residents on Medicaid fall short of actual care costs by between $23 and $30 per resident per day. "That falls on the backs of the employees," she said. "If you can’t give increases and don’t have good starting wages, you are at a disadvantage. ”

Cullen said nursing homes that are making it tend to subsidize care with money from other, less financially-challenging facilities. “If they don’t have apartments or home health or some other revenue stream to keep them afloat, they can only keep open for so long.”  She said 65 Minnesota nursing homes, both rural and urban, have closed since 2000.

To some degree this is by design. The state is trying to limit the number of nursing home beds available, in order to direct more elderly people toward less-expensive options like assisted living. There is also an emphasis on services that keep seniors in their homes longer, an emphasis largely favored by seniors themselves.

nursing home beds chart
Source: Minnesota Department of Human Services

This strategy, which includes a moratorium on new bed licenses, has led to a decrease in the number of nursing homes. In 1987, the state had 468 nursing homes with 48,307 beds, according to an October 2013 legislative report from the Minnesota Department of Human Services. In 2012, the number had dropped to 392 nursing homes with 31,996 beds. That's a 34 percent drop in beds over 25 years. In fact, the report said, “Between 1995 and 2011 Minnesota reduced its bed capacity by 27.92 percent, more than any other state."

Seniors are spending less time in nursing homes, preferring other options. In 1984, one out of every three Minnesotans 85 and over was in a home on any given day. But by 2011 that figure was one out of seven, the report said.

These trends meet the ground in places like Hoffman, where people feel they were caught off guard by the closure and now have to contend with a big hole in the local economy. State statutes restrict how much can be said publicly in advance of a nursing home closure, in order to protect residents from prolonged worry. But Krusemark thinks the city could have raised money for the facility or drawn a grant to train workers, possibly keeping it open. “There was no opportunity to save it,” she said.

“This community would have rallied behind this facility and raised funds if it had to rather than lose 50 jobs,” said Krusemark. “This community was not aware of the financial condition until they were called together on October 7th and told it was going to close on December 6th.” (The nursing home closed earlier, after all the residents found new homes.)

“People call me at home,” she said. “They want me to be able to fix it. I’m going to fix it as good as I can. I don’t know what we can do.”

Good Samaritan’s Hanson thinks the nursing home was too far in the red to be saved. “With the losses we’ve had since 2008, I doubt there would be enough money to fund it.”


Last Thursday evening, the city hosted a meeting about the nursing home at the Hoffman community center. Around 60 people braved the cold weather to drink coffee from Styrofoam cups and hear an economic report prepared by University of Minnesota Extension’s Ryan Pesch. Emphasizing that his analysis was based on estimates, Pesch suggested the overall economic impact of the closure could be as high as $2.8 million annually in Grant County, when factoring in the many ways money circulates through a community.

People discussed businesses that will suffer from fewer customers. They talked about the social impacts of not having the nursing home as a gathering place, and the fact that its closure changes the way many Hoffman residents had planned to finish out their lives.

But what people really wanted to talk about was what happens now, with the nursing home building and local senior services in general. “Why are we beating a dead dog?,” one man in the audience called out. “Good Samaritan is gone. What’s next?”

The Good Samaritan Society has offered to give the building to the city, but with restrictions. The organization will distribute the Hoffman bed licenses among its other facilities or put them on layaway for later, making it virtually impossible to open another nursing home in town. And if the city were to take the building for free, it wouldn’t be able to use it for assisted living, senior housing or hospice care.

Hanson said Good Samaritan, a nonprofit, isn’t crazy about the idea of paying property taxes on an empty building. “I met with the city and have encouraged them to come up with a plan, so we can gift that building to them before the first of year,” he said. “We are not going to let a nursing home go in when we have one in Glenwood and one in Battle Lake. We are hopeful the community will come up with a solution.” If nobody wants it, he said, “The only thing we can do is demolish.”

Buying the building isn’t an option for Hoffman, according to Krusemark, who said the nursing home would be too expensive to purchase and remodel. Yet she’s not ready to let senior services go. She is surveying people in Hoffman to see if they would like the city to "encourage and facilitate" the building of a new assisted living facility in town. So far, the results point to yes.

When she first heard the news of the closing, she worried all her efforts to rebuild downtown would be undone. “I thought, we are back to square one,” she said. “But you pick up your bootstraps and go on.”