News Feature

Originally published in Castine Patriot, May 7, 2009
Not out of the woods yet
PNH braces for another fight

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by Faith DeAmbrose

Teetering on the brink of closure for more than a year, the fate of the Penobscot Nursing Home and its residential component, Northern Bay Residential Living Center, is still anyone’s guess.

This past year circumstances have been less than ideal for Elrcare, LLC, whose owner Sifwat Ali, operates six nursing homes in Maine. The problems began last March when, during an annual survey by the Department of Health and Human Services, PNH received citations for numerous deficiencies. A preliminary fine of $35,000 was assessed. After three subsequent visits, all deficiencies still had not been corrected, and, in June, the Centers for Medicare and Medicaid refused to allow the Penobscot facilities to accept patients covered by these programs. In the ensuing months, this reduced the number of occupied beds by 30 percent and income by $130,000 per month, according to Ali. In October, the PNH and the associated living center, along with the other Maine facilities owned by Ali, were taken into receivership by the state due to concerns about the company’s financial solvency.

To date, PNH and the living center are still under receivership, however, according to a letter from the court-appointed receiver Gail Sasseville, that receivership may be coming to a close soon. DHHS officials did not respond to questions about the status or future of the Penobscot facilities.

According to Ali, he wants to have his facilities back; during the receivership, he says, his company submitted three different plans to DHHS outlining a way for the company to regain control and move forward, but none were accepted by the department. He said a court date of May 18 has been established and that he plans to fight to retain control of the facilities in receivership. Ali said that while it is true the company has had financial difficulty, especially in terms of cash flow, a majority of the problem stems from under-funded Medicare reimbursements. Ali said that, like many health care institutions in Maine, he is struggling with the fact that he is providing services that are not being paid for in a timely manner. This, he said, is affecting all areas of the operation.

In the meantime, while this works through the courts, members of the community have begun to discuss what might happen in a worst-case scenario. On May 1, in a meeting room at PNH, a number of people gathered; the prevailing word used to describe the situation was “murky.” Among those in attendance were the town’s board of selectmen, Representative Jim Schatz, the newly hired nursing home/living center administrator Barbara Steller and half a dozen other community members. The group discussed the importance of PNH in the community from both a medical and a financial perspective.

Currently there are 72 patients and 92 staff members at the Penobscot Nursing Home and the Northern Bay Residential Living Center, said Steller. In addition, the combined annual payroll is approximately $3 million and more than $24,000 is paid to the town in property tax. Selectman and PNH employee Stanley Shorey said that the economic impact is far greater than just payroll and taxes, noting that PNH hires local vendors for services, which adds to the money circulating through the community.

While many discussed the dollars and cents of the situation, a number of people in attendance spoke about the effects a closure would have on patients, their families and others in the community who may eventually need its services. With few open beds statewide, relocation of the patient population would be a nightmare, said Steller, adding that many nursing home residents do not survive when they are moved.

Schatz said that, in the event the receivership issue is not settled in the coming weeks, he would push to have it extended in order to develop a plan that would allow for the nursing home and living center to remain open. He asked that those concerned write letters of support for the continued operation as he sought to either extend the receivership or find funding.

“I am encouraged that so many parts of the community have come together around this issue,” said Schatz on May 6, “and I think it is important to show the level of concern. I think we have a good chance of saving it.”

Those wishing to write letters of support are encouraged to do so. Letters can be sent to PNH at 15 North Penobscot Road, Penobscot, 04476 or e-mailed to administrator Barbara Steller at