BEAVER, Utah — In this small rural community in central Utah, construction crews are hard at work on a brand-new Beaver Valley Hospital Wellness Center, with plans for a multi-purpose gym, exercise studios, a recreation pool and a lazy river.
Next door, the city-owned hospital recently received its own renovation, complete with improved operating rooms, specialty clinics and a dedicated helicopter pad. The city of around 3,500 people estimated in 2021 that the project would cost about $30 million.
Beaver Valley Hospital CEO Scott Langford expressed excitement for the remodel in a recent video, stating that it would help “provide better quality health care and state of the art health care to rural residents.”
“And that doesn’t happen very often,” he added.
Both the hospital upgrades and wellness center were funded, in part, with a portion of dollars received through Utah’s Upper Payment Limit program, which allows non-state government entities like cities and counties that own nursing homes to receive additional federal taxpayer dollars to improve patient care for Utah's elderly and disabled residents.
The facts about the Skilled Nursing Facility Upper Payment Limit Program can be found here.
Beaver Valley Hospital, which itself is owned by the city of Beaver, owns the licenses for more than 40 nursing homes across the state under the program. The hospital declined an on-camera interview but said in a fact sheet provided to FOX 13 News that it’s been saving its portion of the proceeds from the program for 13 years and is now reinvesting them for the benefit of its residents.
“Without these administrative funds, Beaver Valley Hospital and other Non-State Governmental Organizations would have little reason to take on the significant work and responsibilities of the UPL program,” the hospital said.
“The result is a win-win: better care for seniors statewide and stronger health outcomes over time for the communities in Beaver City,” it added.
But to some critics, the construction is a tangible representation of their concerns about how the $1 billion that has flowed through Utah's Upper Payment Limit program over the last decade has been spent – and who it’s helping.
"It’s really an unbelievable example of everyone benefiting but the nursing home residents,” argues Sam Brooks, the director of public policy with the National Consumer Voice for Quality Long-Term Care.
An analysis commissioned by the Elder Care Injury Group – a local law firm that’s pursuing litigation against several facilities in the program – recently highlighted worse care at these facilities than at nursing homes that aren’t receiving extra money under the program.
The analysis of publicly available federal data found that, since 2017, nursing homes in the program have had worse overall ratings from the Centers for Medicare and Medicaid Services (CMS), more inspection deficiencies and lower staffing ratings.
The Utah Department of Health and Human Services (DHHS), Beaver Valley and the Utah Health Care Association have all pushed back on the analysis, arguing that it is not a fair comparison.
But amid questions about quality, Brooks argues that the money generated by facilities in the program is meant to benefit residents at nursing homes, and that Beaver Valley “should not be using these facilities to fund other types of endeavors, like health care centers or workout centers.”
Beaver Valley counters that it’s allowed to use Upper Payment Limit funds to improve or build health care facilities, “since those upgrades directly improve patient care.”
But Doni Hunt Webb, a resident at a Beaver Valley-owned facility in southern Utah, agrees with Brooks. She believes that money in the program could be better spent on improving staffing and addressing quality issues in her nursing home and others across the state.
“I have a lot of anger” toward Beaver Valley, she said in an interview with FOX 13 News. “Why do they deserve [the money] when I'm watching my roommates and my neighbors right here suffer and me suffer?”
‘It’s not working’
In 2017, a legislative audit found that nursing homes were using a little less than half of the federal dollars flowing through the Upper Payment Limit, while Beaver Valley collected the remaining 51% for seed funding and administration fees.
In a fact sheet provided to FOX 13 News, Beaver Valley acknowledged that the hospital uses a small portion of funds “to improve access to care and health services provided by the hospital.” But it said the “vast majority” of dollars in the program are used “by nursing facilities to provide patient care,” including attracting and retaining staff and improving “patient dignity and outcomes.”
A video on the program produced with Beaver Valley Hospital and the operators of some of its facilities suggests that capital improvements have also been a priority for spending at these nursing homes in recent years.
In the video, a camera pans across “before” images of dark, run-down kitchens and dining rooms, contrasting them with “after” footage of light-filled lobbies, modern bedrooms and rehabilitation centers with updated equipment.
“Without the program, services that are provided now would be limited,” one nursing home operator said in the video, adding that “facilities would not be able to have the resources to continue to do remodels, refurbs and build new facilities like this."
Thanks to funds in the program, another added, “we’ve been able to replace four buildings with brand-new infrastructure and are in the process of working on a fifth.” Those improvements include “significant open space for the residents, individual heating and air controls, geothermal heating and air” and “generators that provide power to the entire building.”
Brooks, with the National Consumer Voice for Quality Long-Term Care, acknowledged that the nation has an “outdated nursing home system” and said many residents want to live in “updated places.”
"But if you ask most residents, they'd rather have enough staff to feed them, to get them dressed, to have all of those things,” he added.
Pointing to quality metrics in Upper Payment Limit nursing homes, Brooks argues that the priority for the program’s extra dollars should be on direct resident care rather than on capital improvements.
“It would be different,” he said, if after spending money on infrastructure “you saw an accompanying increase in health outcomes. But you don't see that. So what it shows you is that it's not working.”
Capital improvements, he contends, do more to increase the wealth of the owners of a facility and make the nursing home a better investment tool in the future than they help residents.
'More scrutiny'
Acknowledgments that funds have been used to make improvements in Beaver and comments about improvements at other nursing homes across the state provide a window into how Upper Payment Limit money has been spent.
But those who are concerned about the program’s outcomes say they want more oversight and transparency of those federal dollars.
"You would think taxpayer dollars, municipal governments, we could easily see where the money is going,” said Jeffrey Eisenberg, an attorney with the Elder Care Injury Group. “That’s not the case.”
DHHS, which exercises oversight of the administration of the Upper Payment Limit program, told FOX 13 News that it does “not track specific spending related to how UPL monies are being used.” Beaver Valley and Gunnison Valley did not provide the station with specific breakdowns of how money has been spent overall at the facilities they own.
Though Beaver Valley and other government entities involved the program own the licenses for the nursing homes, the facilities are largely operated and run by private management groups. Eisenberg said opaque accounting practices by these for-profit businesses can sometimes make it difficult to follow the money – and can even serve to conceal profits.
One of the goals of his group's litigation, he added, is to better account for facilities’ spending.
“This is a subject that demands some more scrutiny,” he said. “We are now talking about going on close to $1 billion in Utah over a period of a decade or so that has gone into this UPL program, and we don’t see the metrics to show that it has resulted in better care.”
Nate Crippes, an attorney with the Disability Law Center, is also concerned about the conditions at nursing homes in the program and notes that there has been increasing attention nationally about outcomes and spending within for-profit and private equity facilities.
“As the Protection and Advocacy Agency, we have this same concern,” he said, “particularly when Beaver used UPL funds to help with the costs of remodeling a local hospital, instead of improving the quality of care in the nursing facilities it owns.”
Langford, Beaver Valley’s CEO, has pushed back on accusations that federal funds haven't been properly spent for the benefit of nursing home patients. In a statement, he said that the hospital has followed “all state and federal regulatory requirements of the UPL program since its inception in 2013.”
“All funds from this program, which is one of the most rigorously regulated of its kind in the country and provides more than $100 million annually at no additional cost to Utah taxpayers, have been used strictly for their intended purpose of providing care to Utah’s most vulnerable seniors,” he wrote in an email.
Eisenberg said he has had meetings with the state auditor and with some members of the Legislature seeking additional oversight and transparency over Upper Payment Limit funds. The Disability Law Center has also requested a legislative or state audit to explore questions about why these dollars haven’t done more to improve the quality of care at Utah nursing homes.
"If we’re looking for waste, fraud and abuse, I think you might have some,” Crippes argues. “And I think it’s worth taking a look at."
Both the Legislative Audit Committee and the State Auditor’s Office told FOX 13 News that they do not comment on audits until they are complete. They wouldn’t say whether they are currently looking at or may look again at the Upper Payment Limit program.