Change Coming to Rural Electric Cooperative Governance – Finally!

New Orleans    Cooperatives are something that many of us hold up as models of how things might work in a better – and different – world than the one where we now live and work.   Rural electric cooperatives display their democratic and membership principles as part of the cooperative movement since the 1930s on their walls, websites, bylaws, and membership reports routinely.  As reports issued by ACORN International and the Labor Neighbor Research & Training Center on RECs in the Southern states in recent years have underlined, the actual practice has gone far afield, especially when it comes to governance and democratic practice, self-dealing on pay and benefits, and inclusion of African-American, Latino, and women representation on their boards.

One of the highlights of 2018 in this struggle has been the fact that reporters increasingly in South Carolina and Louisiana have also picked up the trail in some cases using the reports we had assembled as well.  Key issues have been payments to board members as we stressed, but also junkets accompanied by spouses to various logrolling conferences attended by many as perks, which we had not underlined, but certainly where coop members are also footing the bill in their electric rates.

A recent report on coming agreements between the cooperative board associations and the Louisiana Public Service Commission (PSC) indicate that the tide may be finally turning in our direction, at least on some of these issues.  Critically, the early indications indicate that the PSC will mandate term limits for directors, which will be a huge step in the right direction of allowing members to take back control from some of these folks who have been holding on for decades.

There will also finally be limits on so-called “reimbursements” for board attendance.   As our reports indicated the evidence seems to point to manager’s salaries rising for many southern cooperatives in almost a direct ratio to also increasing the pay of directors, as recorded in their IRS 990 filings as 501c3 nonprofit organizations.  These elected positions are supposed to be voluntary, but have become key income sources for many directors, encouraging them to hold on to the posts for years and years.  This PSC action could cap that off.

An issue still unresolved, amazingly, is health insurance, which is a surprising and unknown benefit for volunteer board members, but is all part of this mutual backscratching and log-rolling, and a very pricey benefit at that.  In some cases, the PSC found that family members were also being covered!  All national cooperative recommendations abhor this practice, but reportedly at the expense of the cooperative members, this may be unresolved in Louisiana – and certainly elsewhere – but has to go.

None of these reforms will solve the fundamental issues, but this will be a sea change for many cooperatives, and should be a warning that change is coming, ready or not, to the rest of them.  Now, if we can just hold the Louisiana PSC’s feet to the fire, and get other states to get on board, we will really see some change come as members are enabled to seize back the powers that should have always been theirs.

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Federal Penalties Coming to Middle South Nursing Homes for Care Failures

New Orleans       There are few lobbies as powerful as the nursing home owners’ groups in Louisiana, Arkansas, and Mississippi.  All of which makes the intervention of federal rules extending some of the same accountability standards that hospitals now face, welcome news.  The fact that the penalties go right to their pocketbooks is even better news.

Here’s the deal on the new rules hitting nursing homes across the country now.  Penalties – or incentives for those doing better – will be meted out to nursing homes based on the frequency of readmission of elderly Medicare patients that are returned to hospitals within thirty days of leaving a skilled nursing home.  The financial penalty can reach up to 2% of the individual Medicare reimbursement rate per patient.  Hospitals already have to measure up to this standard and in recent months nursing homes came under the same regime.

Will this affect many homes?  Yes, indeed!

Kaiser Health News reported an analysis of homes in Louisiana and found that 85% of the 277 skilled nursing facilities in the state would be subject to a penalty based on data from 2015 through 2017.  Not that Louisiana was by itself since the figures for nursing homes in Arkansas and Mississippi was almost exactly the same.  Bottom line:  the vast majority of nursing homes in the three-state area are facing penalties.  The Advocate reports that in New Orleans for example, a dozen facilities will face a penalty and only two will receive small bonuses for doing right.  These are not just problems with for-profit providers.  The three homes overseen by the Catholic Archdiocese of New Orleans will each receive almost the maximum penalty for each new admission at 1.98% of the possible 2%.

The question of how nursing homes can provide better care to patients, often elderly, sick, and frail, is a constant concern for families and appropriately for public policy.  Reading the comments from administrators of homes that got the good grades under the new rule, they cite getting more thorough information from the hospitals about incoming and prospective patients is key as well as offering preventive care on site.

All of that sounds right, but given the long experience that Local 100, United Labor Unions, has had in representing nursing home workers and observing care conditions firsthand, it will be difficult to fundamentally improve care until staffing levels are adequate to the significant health demands of patients as a first priority.  Being able to retain professional caregivers also means compensating workers commensurate to the value of the service they provide to families and patients.  In the thirty or more years that we have been involved with nursing homes we still see a conflict faced by many home owners and operators between seeing the facilities as real estate developments with a sideline in healthcare as opposed to healthcare facilities that happen to be built on real estate.

We’ve got a long way to go still, but hopefully the application of this new rule will bring some change now that owners will feel the pain of nonperformance in dollars and cents.

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