‘Please give us a chance’: DeKalb County nursing center employees appeal to board amid sale proposal

Dwindling residents, delinquent billing, mismanagement at center of financial issues, documents show

Chuck Holter, a maintenance worker at the DeKalb County Rehab and Nursing Center and union president for nursing home employees, expresses his opposition to the proposed sale of the center during the DeKalb County Board's Committee of the Whole meeting Wednesday, April 13, 2022, at the County Legislative Center in Sycamore.

SYCAMORE - More than a dozen employees of the financially struggling DeKalb County Rehabilitation and Nursing Center appealed to the DeKalb County Board not to sell the facility this week during a tense discussion as the board weighs options for center’s future amid a $7.4 million budget hole.

County officials, meanwhile, shed more light on the struggling nursing facility’s financial plight. According to county documents and testimony this week, the shortfall is due to issues including delinquent billing dating back to 2017, dwindling resident numbers and what employees allege was years-long mismanagement of the facility.

For the past 24 years up until Dec. 31, the nursing center was run by St. Louis-based Management Performance Associates (MPA), a firm which was under county contract. The firm, responsible for overseeing daily operations and creating the facility’s annual budget for county board approval, declined to renew its contract in December.

During a county board Committee of the Whole meeting Wednesday, a crowded room filled with nursing center staff as discussions began on whether to sell the facility. Up until now, county officials maintained a sale of the nursing center wasn’t imminent, nor a preference. No vote was held Wednesday, though the board’s executive committee agreed to place the matter up for vote at a future board meeting. The next DeKalb County Board meeting is set for 7 p.m. Wednesday, April 20.

Chuck Simpson, a 30-year restorative aid at the nursing home, issued an impassioned plea to the county board.

“Please give us a chance. Let us have a competent management firm to try to right the ship,” Simpson said. “We have a model at the county home and a history of caring...How did the county let this fall like this? Now we’re in the hole over $7 million. How did this happen? You can’t blame the hard workers here.”

County board chairman John Frieders said he empathized with employees and said he knows a county board decision won’t make everyone happy.

“If it is sold, it will still be a nursing home,” Frieders said. “The quality of care will still be assumed through the state and federal government.”

Amid nearly a half hour of public comments by Rehab and Nursing Center staff followed by a nearly three-hour county board debate, questions swirled about the severity of money shortfalls: Why, as records presented Wednesday showed financial inaccuracies dating as far back as 2017, was this issue not brought to light sooner, residents and board members asked?

Nursing facility administrator Maggie Niemi, who was hired in October, spoke up frequently during the meeting in defense. Amid sometimes heated exchanges with county board members, she said the nursing facility remains a viable longterm care option for county residents.

“We are bringing in money, a good amount,” Niemi said. “A lot of the things brought up before have been going on in longterm care for years. Without a management company, we have made more strides to do things properly.”

Niemi said the facility received $100,000 in federal CARES Act funding this week.

“I have a hard time swallowing this because we come out of the pandemic and we have given good care during the pandemic only to be faced with this obstacle,” she said.

Maggie Niemi, administrator at the DeKalb County Rehab and Nursing Center, opines that she believes the center can be fiscally viable during her turn during public comment at the DeKalb County Board's Committee of the Whole meeting Wednesday, April 13, 2022, at the County Legislative Center in Sycamore.

Tracking the money trouble

County officials and nursing facility staff told the Daily Chronicle this week the current DeKalb County Rehab and Nursing Center census sits at about 126 beds. The facility’s budget assumes an annual average census of 175.

From 2017 to 2019, the facility had 183 authorized employees on the budget, DeKalb County Administrator Brian Gregory said. That was bumped up in 2020 to 186. Nursing facility employees said Wednesday, however, that staffing levels fluctuated throughout the pandemic.

Employees argued that losing county ownership of the facility would deprive it of programs they’re able to do, state and federal grants the center’s able to receive, and resources to provide optimal patient care. Workers also expressed fears over what would happen to current employees and employee benefits under an ownership change.

Gregory, who began his position a little over a year ago, said he was first alerted to red flags in the nursing center’s book-keeping that month.

“When I started at the county on March 1 of 2021, I was unaware of any issues at the nursing home and I think by and large the board was unaware of issues,” Gregory said. “Not too long ago they had heard abut the expansion and where we sat and there was no mention of the financial challenges that were there.”

On March 15, 2021, Gregory said he received an email from the DeKalb County Treasurer’s office which was his first inkling that something with the nursing home’s money was off.

“I got an email on March 15 telling me that there was no cash in the nursing home. Zero,” Gregory said. “All the information that we received was that it came from nursing home management company that this is COVID, this is all about COVID. And it made sense...What we learned is very quickly that that wasn’t going to be the case.”

By September 2021, a $2 million loan approved by the county board April 21, 2021 to help offset nursing home finances was exhausted. That was the beginning of nearly monthly payments funneled from the county’s budget to the nursing home’s budget to offset costs and help make payroll.

According to a timeline outlined by Gregory, money woes fall into two categories: a cashflow issue at the center which impacted its ability to make payroll obligations without additional county aid, and a lack of revenue to make up for expenditures because vendors weren’t being billed on time.

“They were not billing properly,” Niemi said of past management. “...For five months at the end of 2021, there was no billing going on. They switched to a different billing company and in the process no billing was occurring.”

County home residents who qualify for Medicaid can in turn often have services provided to them by the facility, whether its Medicaid covering daily expenses or nursing bills. The facility would bill the state, and the state would in turn pay the bill. Delinquent billing meant lost revenue for months, Gregory said. The state of Illinois also requires Medicaid bills to be sent within a certain amount of time of services rendered, leaving unpaid bills and uncollected revenue.

In 2019, the nursing home’s budget anticipated $15.9 million in revenue from patient services, but received $13.9 in actual revenue, with a $2.09 million shortfall. That trend continued in 2020, with $16.65 million budget for expected revenue, but $13.83 collected, records show, creating an additional $2.8 million shortfall.

In August 2020, the county board approved a sale of $13 million in bonds to cover the nursing home’s expansion, meant to accommodate what officials said at the time was a growing population and expand the facility’s transitional care unit capabilities. The bond is a 30-year deal, averaging $661,500 the county is liable to pay, or $19.8 million for the next three decades.

“MPA managed this home for 24 years, right, wrong, however you want to look at it,” Gregory said. “But it’s a mix of management company but...there are some things on the county side that our employees are responsible for. And following through with Medicaid funds, that stuff was not happening.”

Gregory said the nursing home had its own finance office of county employees tasked with doing bills.

“The staff members that were part of it are no longer here,” Gregory said Thursday. “The staff that are there have stepped up and worked very hard to ensure all the current billing is correct, but there’s been a turnover of staff.”

On Oct. 15, 2021, the now-defunct nursing home’s operating board notified MPA that it would bid out alternative management firms in the new year. On Oct. 29, MPA told the county it intended to terminate its contract at the Dec. 31 expiration. On Oct. 27, the county board approved another $1.5 million to the nursing center for invoice payment aid, another $1 million in November for invoices and payroll, and another $800,000 in December. On Feb. 4, $100,000 was again funneled over to the nursing center from the county budget, and $1 million again on Feb. 18, documents show.

Gregory said county staff estimate another $500,000 is needed to be funneled to the nursing home from the county’s own reserve budget as of mid-March.

As of April 13, the county nursing center has $1,405,000 in the bank, according to documents, but anticipated monthly expenditures show that another $525,000 could be needed to offset that cost. That includes two rounds of payroll totaling $320,00 each, $375,000 worth in already approved lawsuit settlements, and $915,000 in written checks.

In total, the county’s put in $7.4 million in unplanned financial aid to the nursing facility to help offset financial constraints brought to to its attention nearly a year ago.

“So the conclusion is that...COVID did not have that profound impact on our revenue as we were being told,” Gregory said.

Where to go from here?

Before the county board now lies three options: Find a new management company, find someone to lease the nursing facility, or sell the facility to a private buyer.

If a sale was authorized by the county board, Gregory said he estimated the pursuit could take up to seven months, but provide instant debt relief to the county.

Niemi said she believes if given one to two years still under county ownership, the facility could right its financial wrongs. Gregory told the county board that continued need to flow money into the nursing home would mean less funds able to be used elsewhere in county government, which also oversees the DeKalb County Sheriff’s Office and funnels money to the DeKalb County Health Department.

Don Gates of Sandwich, who’s granddaughter works at the center, which his mother has called home for three years, said he believes the decision on whether to rekindle a tax referendum to aid the nursing home should have been left to the voters. In mid-March, the county board voted down that referendum which would have posed the question to the voters on the June primary ballot.

Gates called into question the changing census numbers over the years.

“Five years ago, I tried to get my mom into the county home for six weeks,” Gates said. “It was a 30-people waiting list.”

Board vice chairwoman Suzanne Willis said she was concerned that the county’s annual audit didn’t uncover the nursing home’s plight sooner.

“How many other things are sitting out there?” Willis said. “Why didn’t anyone tell us about this? I’m very upset about this.”

Gregory said audits inspect accurate bookkeeping but don’t necessarily point out budget constraints unless there’s overspending. In the nursing home’s case, the spending wasn’t over budget, but the revenue collection fell short.

Board member Scott Campbell suggested the facility be given a chance to have its budget rewritten to accommodate for 130 beds instead of 175, to allow the board to better understand its financial viability.

“I don’t think we know what it would cost to operate the nursing home at 130,” Campbell said. “And I think that’s what we should be asking.”

Gregory said that would be about one-third of the facility’s budget, which could impact personnel and in turn patient care.

Chuck Coulter has worked in maintenance at the nursing facility for six years and is the union president of the American Federation of State, County and Municipal Employees 3537. AFSCME 3537 represents about 220 county employees from the nursing center, government offices and health department. About 2/3 of the members work at the nursing home, Coulter said.

“You guys almost unanimously voted down the one that that would’ve helped us,” Coulter said, referring to the failed referendum. “The operating board was in place to oversee us...Well, that same operating board in five years destroyed the nursing home by their lack of efforts. You’re sweeping your mistakes and we’re paying for it.”

Have a Question about this article?