Other counties’ experiences suggest that selling DeKalb County Rehab & Nursing is unlikely to provide a quick fix


The Executive Committee of the DeKalb County Board has voted to place a resolution authorizing preparations for a sale of DeKalb County Rehab & Nursing Center (DCRNC) on the agenda for next week’s regular meeting of the full board.

During discussion of DCRNC’s plight, the chair brought up the sale of the nursing facility once owned by Rock Island County (Hope Creek) and what he called a “sale in process” of Stephenson County’s (Walnut Acres). It was an “everybody else is doing it” type of argument.

It’s true that the Rock Island, Stephenson, and DeKalb County facilities share similar stories involving struggles to pay their bills. They’ve seen serious management turnover and chronic staffing shortages and hits to their CMS star ratings, exacerbated by pandemic impacts and all affecting bottom lines. It’s also true that selling a county-owned nursing facility is an option that must be considered in hard times. But could DeKalb County really sell DCRNC in six or seven months, as the county administrator and the consultant are saying? And could we get a fair price for it? The experiences of Hope Creek and Walnut Acres suggest the answers are no and no.

Rock Island County voted to sell Hope Creek in June 2019. From that point, it took a full year to finalize a sale. The county had listed the property at $19 million to pay off its mortgage and short-term debts, but the first offer, in February 2020, was only $6 million. Nevertheless, Rock Island accepted the offer — but then the deal fell through. Finally, the county sold the facility for $4 million in mid-2020.* Residents of Rock Island County had been paying property taxes to help support Hope Creek, and though they don’t own it anymore, they will continue paying until the facility’s remaining debts are paid.

Stephenson County authorized a sale of its nursing facility almost exactly a year ago, and still hasn’t succeeded in selling. Walnut Acres is smaller than Hope Creek or DeKalb County at 145 beds. (DCRNC has 190.) Stephenson listed the sale price at $5 million and received an offer of $2 million in June 2021 that was approved by the board, but the sale was not finalized. Another offer, of $1.6 million, was rejected by the board three months later.

Last month Stephenson voted on a resolution to close Walnut Acres, but it required a supermajority and the motion failed. Luckily, its nursing facility committee — a standing committee of the county board — had already worked out an alternative option. It includes downsizing to 75 or 80 beds, carefully maintaining a payor mix that will cover costs, and repurposing part of the building for office space. Also, the rehab company Walnut Acres uses for in-house therapies now offers outpatient services on the site as well, creating another revenue generator.

Hope Creek and Walnut Acres show the trend is not our friend, the current reality of the buyer’s market suggesting that selling is unlikely to be quick, nor offer a real fix to what’s ailing our nursing facility. I recommend DeKalb County Board members take a cue from Walnut Acres and develop a Plan B, regardless of any pursuit of a sale.


Forbes (March 2020): Why are so many nursing homes shutting down?

Most of my sources are meeting minutes obtained from county websites.

*To add a bit more context here, Hope Creek has 245 beds; in early 2019, Champaign County, with 220 beds, had sold for $11 million.