State cuts to Medicaid reimbursement rates and a large number of vacancies in the Vashon Community Care Center’s assisted living facility have made it necessary for the center to double its annual fundraising goals, care center administrators said.

The center has also made several cost-saving changes in recent months, has created new programs expected to bring in additional revenue and is evaluating all its programs in light of the current financial picture, according to Susan Tuller, the administrator at the Vashon Community Care Center (VCCC).

The financial picture has never been easy in her six years at the institution’s helm, Tuller said, but this situation is the worst she has had to face in her tenure there.

Truman O’Brien, president of the organization’s board, concurred. Like Tuller, he believes continued community support will be vital to VCCC facing this challenge successfully. The care center hopes to increase private giving this year from $150,000 to $300,000, he said.

“Our situation is dire,” he said. “But we have the skill and the heart and the talent to weather this, and I think the community will come together and make this thing work. They’ve done it before, and I believe they’ll do it again.”

Earlier this year, because of the state’s troubled financial situation, the Legislature passed a supplemental budget for April, May and June that called for a 10 percent cut to Medicaid funding for nursing homes. Because 80 percent of VCCC’s residents receive Medicaid, that cut hurt deeply. In July, when the state’s new two-year budget goes into effect, the Medicaid reimbursement rate will actually improve a bit but will still be 6.5 percent lower than what the center had budgeted and 4 percent lower than the reimbursement rate a year ago. Typically, Medicaid has covered 72 to 75 percent of the cost of a resident’s care at VCCC, Tuller said. Now it will cover only 68 percent.

Compounding the Medicaid funding problem are the openings in the center’s assisted living facility — a trend affecting such facilities nationwide, Tuller said. Out of 39 units, eight are now empty. Tuller and others at VCCC attribute this vacancy rate to the economy. Some elderly people are having a hard time selling their homes, while others are facing diminished savings and home values — and considerable economic uncertainty.

Last winter, when VCCC officials realized the state funding picture was bleak, staff and administrators knew they needed to create a revenue stream independent of Medicaid funding — a program that would serve people as well as bring in money.

Out of that process, the center has begun an orthopedic rehabilitation program for those with Medicare Part A — government-funded health insurance for people over 65 as well as some people with disabilitites. The rehab program serves people after they have been hospitalized for a hip or knee replacement or other orthopedic problem and need inpatient follow-up care. Clients live at VCCC and receive physical therapy and occupational therapy five days a week, Tuller said. Staff can accommodate two to three people at a time.

With a full census, the program could bring in $5,000 to $10,000 a month, but it will not be full all the time, Tuller noted, and costs of the program will eat up some of the revenue.

VCCC staff are also looking into whether they could offer case management to people hoping to stay in their homes, a program they hope to launch this summer. As part of this program, VCCC staff would offer caregiver coordination, informational referral and in-home assessments and planning in many areas important to remaining at home, including health, home safety and finances.

Some longterm insurance plans cover this service, according to Naomi Goldick, a social worker at VCCC, and some large companies offer it as a benefit as well.

Over the past months, staff have also been trying to cut costs — from turning out lights to cutting their hours. Overall, hours have been cut 15 percent, most of them voluntary, Tuller said. Patient care has not been compromised, she said, because the center has created some better systems and undertaken a lot of cross training, ensuring staff are trained to handle multiple tasks.

“Their work is harder now,” Tuller said. “It requires all the staff to do a little bit extra, and now we’re asking them to do a little bit more.”

Staff give in other ways, too. Two staff members write a donation check each month, Tuller said, and staff member LoAnne Forschmiedt is running for unofficial mayor to raise funds and awareness about the needs at VCCC.

Administrators are also examining each of VCCC’s programs, including its popular foot care and adult day health programs, to reduce costs or bring in more money.

But even with new income-generating programs and cost-cutting measures, the picture is far from rosy.

“I don’t know what it’s going to take to weather this yet,” Tuller said. “As this downturn extends, what’s going to happen next January? Next June? The issue is sustainability over time.”

“Obviously, it would be great if someone just gave us a lot of money,” she added. “But we expect (the solution) to be a lot of different things.”

To that end, O’Brien said board members will be doing more fundraising, meeting with donors, especially those able to make large gifts. Rep. Sharon Nelson (D-Maury Island) has offered to work on fundraising with the board, which will meet with her soon to determine her role, O’Brien said.

The annual report is being mailed out this month to every Vashon household. Instead of only looking back, as most annual reports do, this one will look forward and discuss ways to address this financial crisis, according to Linda Milovsoroff, the director of development.

She hopes also to keep VCCC firmly in the public eye at special events on Vashon to help people remember it and its mission. Community support has already made a difference, administrators noted.

Initially, Gov. Chris Gregoire proposed more dramatic cuts to the Medicare reimbursement rate; lawmakers, after hearing from Islanders, found a way to partially restore funds to the program.

At VCCC, staff will continue searching for solutions as they continue to care for the elderly — many of whom have lived here for decades, owned houses on the Island and are part of the fabric of Vashon, according to Tuller.

“We’re hoping folks will step up and help,” she said.