Valley High Operating Community administrators told members Oct. 3 that the new Heart of the Valley memory-care unit reached full occupancy within weeks of opening and is already improving the facility's financial position.

The administrator said all 21 beds in the memory-care unit were full and that the facility's August revenue was about $150,000 higher than July, narrowing a mid-year operating shortfall. "In August, our revenue is a $150,000 more than it was in July," the administrator said, adding the organization's net loss fell from about $257,000 in June to about $129,000 in August.

The unit opened June 23 and, according to the administrator, reached a stable resident census faster than projected. "We filled it in 2 and a half months," the administrator said. Staffing for the new unit was at full complement from the start, the administrator said, and managers reported high family and referral-source interest following community events showcasing the unit.

Administrators provided payer-mix targets and current case-mix figures used for budgeting. For the overall facility the target case mix is roughly 58 percent Medicaid, 25 percent Medicare and 16 percent private pay. For the memory-care unit the targets are 57 percent Medicaid, 24 percent Medicare and 19 percent private pay. The administrator said actual percentages were close to those targets and that short-term rehabilitative (Medicare) cases have been an active source of admissions to the unit.

Project costs tied to the memory-care build were described as essentially on budget. The administrator said construction- and start-up costs are close to forecasts, noting two remaining items that will be charged to the project budget: adjustments to the Wander Guard installation and repairs to an irrigation system damaged during construction. When those final invoices are processed, administrators expect the project to end approximately at the originally approved budget.

The administrator cautioned that a pending state-level change in Medicaid reimbursement rates could materially affect revenues if enacted. "If one big bill cuts Medicaid reimbursement, well, it would be the downstream impact of that bill," the administrator said, adding that the board will reassess case mix and rates if the legislature reduces Medicaid payments.

Members asked for periodic updates on occupancy, payer mix and the operating effect of the memory-care unit; the administrator said the next regular report will include finalized August financials and further detail.

The meeting recorded no formal board vote specifically on the memory-care unit at this session; financial figures and budget forecasts were presented during the administrator's report.