Wall St. Journal article on “Green Houses”

Below are excerpts of an interesting article about “Green Houses”.  A new approach to taking care of the elderly.  The article is called: “Rising challenger takes on elder-care system” (06/24/08 Wall Street Journal) By Lucette Lagnado

In the spring of 2001, Bill Thomas, dressed in his usual sweat shirt and Birkenstock sandals, entered the buttoned-down halls of the Robert Wood Johnson Foundation.  His message: Nursing homes need to be taken out of business. “It’s time to turn out the lights,” he declared.

Cautious but intrigued, foundation executives handed Dr. Thomas a modest $300,000 grant several months later. Now the country’s fourth-largest philanthropy is throwing its considerable weight behind the 48-year-old physician’s vision of “Green Houses,” an eight-year-old movement to replace large nursing homes with small, homelike facilities for 10 to 12 residents.   “We want to transform a broken system of care,” says Jane Isaacs Lowe, who oversees the foundation’s “Vulnerable Populations portfolio.” “I don’t want to be in a wheelchair in a hallway when I am 85.”

The foundation’s undertaking represents the most ambitious effort to date to turn a nice idea into a serious challenger to the nation’s system of 16,000 nursing homes. To its proponents, Green Houses are nothing less than a revolution that could overthrow what they see as the rigid, impersonal, at times degrading life the elderly can experience at large institutions.

Green Houses face a host of hurdles.  Plus, experts say the concept faces stiff resistance from many parts of the existing nursing-home system. Traditional nursing homes, many of which care for 100 to 200 patients, are predicated on economies of scale — the larger the home, the cheaper it is to care for each individual resident.

“Robert Wood Johnson is making an important investment to try to make sure there is a sufficient cadre of early adopters of the Green House model — and research to make sure the model is actually working,” says Thomas Hamilton, who oversees nursing-home quality and regulatory issues for the Centers for Medicare & Medicaid Services. He says his agency is trying to coax nursing homes into changing their cultures and adopting more humane, “patient-centered” models such as the Green House.

The $122 billion nursing-home industry arose from the 1965 birth of Medicare and Medicaid, the government health-insurance programs for the elderly and poor that provide billions in government reimbursements. Made up of both not-for-profit and for-profit companies, the industry still generates most of its revenue from Medicaid and Medicare.

Ms. Lowe and her foundation colleagues began to shift that stance after their meeting with Dr. Thomas. A native of upstate New York, Dr. Thomas headed to Massachusetts to get his degree at Harvard Medical School, then returned to work as a doctor in a local nursing home. He says he was troubled by the experience. “I was distressed by the amount of emotional suffering that people were encountering even when they had good medical care,” he says.

But it was Dr. Thomas’s electric delivery — officials liken him to an evangelist — that got the group’s attention. “Our energy needs to be around how to replace nursing homes. Not replace the building but replace the idea that older people can be taken away and put into an institution,” Dr. Thomas recalls saying. He described his vision of homelike places where elderly residents could gather, dine together and sit before a blazing fire.

In 2003, Ms. Lowe traveled to Tupelo, Miss., where the first Green House had just opened, and says she marveled at how different it was from a well-regarded nursing home she’d previously visited. “Instead of thinking, ‘I don’t want to be here,’ it was, ‘How can I move in?'” she recalls.

Rebecca Maust, chief of the Division of Quality Assurance at the Ohio Health Department, says in a statement that the agency “fully supports” person-centered care but that Green Houses have to be on the same lot as the main nursing home to “ensure proper care of residents.”

Mr. Hamilton of the Centers for Medicare & Medicaid Services says his agency doesn’t think existing rules “represent any serious barriers” to the Green House model. He added that he wants to “maintain open lines of communication” to any parties who believe that a regulation is a barrier.

“There are providers who don’t want to change because of the capital investment they’ve made,” adds Larry Minnix, CEO of the American Association of Homes and Services for the Aging, which represents not-for-profits. But he says they need to. “Forty years ago, the paradigm was the ‘minihospital’ and that is what became the modern American nursing home,” Mr. Minnix says. “That is not what is needed now.”

Robert Jenkens, who is spearheading the Green House project at NCB Capital for Robert Wood Johnson, says that some not-for-profits and at least one for-profit believe the model to be financially viable. St. John’s Lutheran Ministries in Billings, Mont., operates both a nursing home and some Green Houses. In an internal review, officials found that it cost $192 a day to care for a resident in the traditional nursing home versus $150 a day in their Green Houses.

Based on this “first round” of Green Houses, they believe that it is financially doable, but they are rigorously testing the model and developing software that should help providers determine whether they can handle Green Houses financially.   “Green House belongs to the tradition of finding the better product, of building the better mousetrap,” he says.