Evanston-based management company offers $8.1M to buy struggling DeKalb County nursing home

DeKalb County Rehab and Nursing Center

DeKALB - An Evanston-based health care management company wants to buy the financially struggling DeKalb County Rehabilitation and Nursing Center for $8.15 million, DeKalb County officials said this week.

No formal vote is expected to occur before June 15. However, the DeKalb County Board’s Committee of the Whole will begin deliberations on the sale at its regular meeting at 7 p.m. Wednesday in the Legislative Center’s Gathertorium. Evanston-based Illuminate HC LLC, a health care facility management company that states its speciality is skilled care, according to its website, has offered $8,150,000 for the struggling nursing home that is more than $7 million in the hole.

Little is known about the proposed purchase offer as of Tuesday, since published documents ahead of Wednesday’s meeting don’t include a drafted contract or letter of intent to purchase. Those documents are expected to go public Wednesday however, county officials said to the Daily Chronicle.

While documents of the proposal non-binding contract haven’t yet been made public as of Tuesday night, the contract would include stipulations, including that the board could later decide to back out of a deal in the future if they so choose, said DeKalb County Administrator Brian Gregory.

“There are due diligence periods spelled out in the [Letter of Intent],” Gregory said Tuesday.

The nursing facility faces millions in debt caused by what officials have said was years of mismanagement, delinquent billing, falling resident numbers and too heavy a reliance of agency-staffed workers who get paid more than county employees.

Over the past year, the County Board has grappled with the financial future of the facility. In January, the board approved a $10,000 contract with Chicago-based consulting firm Marcus and Millichap to help determine what options lay in front of them to address the nursing center’s longevity.

According to documents released ahead of Wednesday’s committee meeting, the County Board will hear an update on the operations of the facility, a report on its financial health and a presentation on the purchase offer and non-binding letter of intent.

“Since first learning the DCRNC did not have cash resources to operate independently last March, the County Board has committed over $7.3 million of cash flow assistance and has discussed ways to address the challenges at twenty-three different committee or board meetings,” Gregory said in an email.

No vote to approve a purchase is expected Wednesday, although the County Board’s executive committee could decide to place it up for a vote at the next board meeting, as early as June 15.

If the board votes to approve the purchase, there remain stipulations in place before any transfer of ownership would be finalized, Gregory said. He said those stipulations are outlined in the proposed letter of intent.

On Wednesday, board member Scott Campbell, a Democrat representing District 7, alongside colleague Bill Cummings, a Republican representing District 8, are expected to present their findings from a six-week internal investigation into budget options for the nursing facility.

In April, when the board decided to move forward and pursue sale options, Campbell proposed the County Board’s Finance Committee be allowed to review financial records to determine whether the facility could operate independent of county government financial aid. That’s how the facility was meant to be run, officials said, and if given the proper staff cuts and operational tweaks, perhaps it could be so again.

Gregory has said, however, that continued reliance on additional county funds to help prop up the nursing center could cut into government funds meant to go elsewhere, such as to the sheriff’s office or other resources.

The nursing center’s staff, including administrator Maggie Niemi, have argued the facility can rekindle its independence if given time.

The debate over the facility’s future has fueled public outcry for months, as the nursing center’s staff appeared before the board numerous times to appeal for different options instead of a sale.

For about a year, county officials have fielded almost-monthly budget deficits from the facility, which faces a $7.4 million budget hole. According to county documents and testimony, the shortfall is due to issues that include 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 that 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.

County officials, including board chairman John Frieders, have said that if the facility were to be sold, it would remain a skilled nursing facility for residents and those needing rehabilitation. Current center employees voiced skepticism that the level of care would remain the same under new ownership.

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