Health Care and Insurance and Indiana Health Care Association and Long-Term Care and Government and Health Care & Life Sciences

New president shakes up nursing home group: Three quarters of staff leaves within months of arrival

July 21, 2008
In the sleepy world of trade associations, Steve Smith is like a fire alarm at 3 a.m.

Smith has shaken up the Indiana Health Care Association so much, the group representing Indiana's for-profit nursing homes is hardly recognizable to those who knew it before. And the way Smith tells it, he's just getting started.

Since taking over as president Nov. 1, Smith has dismissed or chased off nine of the group's 12 employees. He even fired 17-year veteran lobbyist Faith Laird less than a month after he arrived.

Smith moved the organization into smaller office space in the One North Capitol building downtown. He had the group's logo redesigned. He even tried to change the 53-year-old group's name-until market research concluded it was highly recognized in government and industry circles.

"It truly is a rebirth of the organization," said Smith, 46, sipping from a can of Rockstar Energy Drink during an interview.

It's unclear whether Smith's hyperkinetic changes will turn out to be a Renaissance or a wreck. But it is clear that he thinks little of how the association was managed before and is determined to make it run more like a business.

A former Affiliated Computer Services Inc. executive who served in Gov. Mitch Daniels' administration, Smith wants to overhaul the way the association brings in money. Eventually, he wants to eliminate dues and generate revenue by selling more group purchasing and revenue-management services and insurance to IHCA members.

The Indiana Health Care Association already did those things through a forprofit subsidiary, but without much profit. Smith thinks he can change that.

He said he has cut nearly $500,000 from the group's $1.8 million budget.

"We looked at everything," Smith said.

The biggest savings by far came from cutting staff. The association has nine employees, down from 12 when Smith arrived. Eliminating Laird's job saved about $100,000.

"I was a high-cost item, I guess," said Laird, 72.

She said she's not bitter, but is confused by Smith's decisions.

"We were highly successful as the leading long-term-care association," she said, adding that efforts to rebrand and reorient the group had happened many times before. "We've been talking about rebranding that association for as long as I've been there."

Oddly enough, Laird will soon land at Smith's former employer. Before joining IHCA, Smith was director of aging at the Indiana Family and Social Services Administration. Later this month, Laird will become deputy director of aging there.

And Smith is now leading the group that butted heads with FSSA in 2005 and 2006 over changes to Medicaid reimbursements, which cover most nursing home patients' bills.

FSSA Secretary Mitch Roob, who oversees the Medicaid program for the state, set a goal to reduce Medicaid rate increases to 5 percent per year. IHCA questioned the plan, drawing criticism from Roob and Smith. Before joining the Daniels administration, the two had worked together at Dallas-based ACS, where Smith was a senior vice president.

The IHCA board pushed out its president, Art Logsdon, in late 2006 and hired Smith a year later. Under his leadership, the group joined two smaller nursing home associations-Hoosier Owners and Providers for the Elderly and Indiana Association of Homes & Services for the Aging-in supporting Roob's changes.

Smith is shifting the association's focus away from reimbursement rates and toward helping nursing homes reduce their staff turnover rates.

His focus gets applause from Greg Smith, a part owner of Morristown Manor in Shelby County-and no relation to the IHCA leader.

"What we've come to understand is that, any metric that you use to measure the successful operation of a nursing home, you can really tie directly back to staffing," he said.
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