PEORIA — Peoria County is turning to OSF HealthCare to help stanch the multimillion-dollar deficits at the Heddington Oaks nursing home.
Board members voted 13-2 to approve a proposal authorizing county administrator Scott Sorrel to enter into a potential agreement with one of the the health organization's subsidiary arms.
Final details are still being worked out, but the initial, 120-day pact would permit the OSF entity to bring in a full-time, licensed administrator to run Heddington Oaks. The home has had multiple full-time or temporary administrators in the past few years.
Although spending is under budgeted amounts, revenues are also coming up short, Sorrel said. Heddington Oaks has only filled 165 or fewer of its 214 beds each month in the past year.
Because of that, the home is projected to see a cash burn this year of $2.9 million, and at the current rate could lose a further $1.9 million next year, Sorrel said.
If those deficits continue, he cautioned, the nursing home's fund balance will be negative by late next year or early 2020, forcing the county to use other taxpayer funds to prop it up.
OSF managers will be charged with doing what officials have described as a financial deep dive, intended to find ways to bolster the number of residents, as well as to improve collections on aged bills, improve care quality and work on improving the facility's CMS Medicare Star Rating.
The county is also pursuing a "master services agreement" with OSF, essentially setting the framework under which any future agreements would be negotiated. At the end of the 120-day period, county officials are likely to bring forward a new proposal on how to implement the recommendations.
It's not yet clear what OSF HealthCare's role would be beyond the initial, 120-day contract.
But many board members were quick to praise the organization, with board member Jimmy Dillon emphasizing its role as a partner that "believes in the same mission of care over profits."
After he met with OSF officials, board member Jim Fennell labeled himself cautiously optimistic they could improve the number of residents at the home.
Sorrel said some 90 percent of existing Heddington Oaks residents were referred through OSF facilities, and that similar referrals from UnityPoint Health facilities had dried up after the company opened its own skilled-care location.
Meanwhile, member Steve Rieker challenged the rest of the board that any decisions after this 120-day process need to look at costs over the long term.
"The outcome needs to be that we have a business plan for the long term, for 20-plus years out, that will say this is what it will cost the taxpayers of Peoria to provide this service," he said.
Not all board members were eager to move forward. Brad Harding and Greg Adamson expressed concerns about entering the agreement without competitive bidding.
"In my opinion, it would've been best to look at all of our options," Adamson said.
Board members have been told at different times in recent months their options are limited, though. The board cannot sell the facility outright or have it operated by a profit-making entity without costs being added to the government bonds issued to pay for constructing the $48 million home.
Losing the facility is not an option for residents like Carol Holford. The longtime Peoria neighborhood advocate said in her short time at the facility she's been treated with the utmost dignity and respect by all staff.
"It would be a shame if this place folded, not just for the people who get paid and work here, but for all the people who don't have any other place to go except to here," she said.
Holford also took a dim view of officials who would sound off about the home or be critical of its role without first-hand knowledge.
"It just blows my mind that all these County Board people want to make an issue of this place, but you don't see many of them out here," she said.
The changes proposed Tuesday are the outgrowth of committee work that for the last several years has included representatives from OSF HealthCare and UnityPoint Health.
Sorrel said the cost for the agreement is likely to be no more, and perhaps slightly less, than the amount the county had budgeted for pay for a full-time administrator over the 120-day period.
The proposal won the support of all members present except Harding and Adamson. Members Barry Robinson and Brian Elsasser were absent.
Chris Kaergard covers politics and government. He can be reached at firstname.lastname@example.org. Follow him on Twitter @ChrisKaergard.