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C-TH sets Valley Meadows deadline

by Sharon Carter

With a score of Valley Meadows staff members in the audience, Carson-Tahoe Hospital officials Thursday gave a proposed partnership between the Gardnerville Ranchos nursing home’s employees and its landlord, PDQ Investments, until the end of the month to come up with a plan to take over the operation.

The deal would be brought back before hospital trustees for approval at their April 8 meeting.

The move was seen as a fail-safe measure to keep Valley Meadows Rehab and Sub-Acute Hospital, formerly known as the Cottonwood Care Center, open in the event an institutional buyer cannot be found.

Hospital officials, who have said they want to be out of the nursing home business by June 30, earlier this month ordered their administrative staff to develop a plan to close Valley Meadows and move its residents if a buyer could not be found.

n Multiple concerns. That directive, which generated concerns about the well-being of Valley Meadows patients, employment security for its staff and diminished property values, led to the joint proposal.

“My concern is the patients… We need a positive arrangement,” Trustee Paul Saucedo told advocates of the proposal. “Get your ducks in a row. We need a policy in place on April 9. If it stalls for a second, (closing down and moving patients) is a done deal.”

Valley Meadows’ court-appointed receiver, Jim Heinzen, who has been the nursing home’s administrator for the past 14 months, PDQ’s managing partner and former Douglas County commissioner Dave Pumphrey and Carson City attorney Scott Heaton are putting together the bid.

“I’d like to have it done tomorrow afternoon, and so would all the employees,” Heinzen said. “It’s important to get it done right away to end the suspense and uncertainty.”

n C-TH losses. The public hospital has reportedly lost close to $5 million operating the nursing home since purchasing it in 1995. Its losses include state-imposed licensing constraints and fines of up to $3,000 per day. An abortive attempt to sell the operation to Arizona-based Premier Care in 1997 resulted in about $1.5 million in losses, two-thirds of which was a hospital-backed credit line for Premier. When Premier failed last fall and the hospital sued, Valley Meadows went into receivership.

“We can’t justify the (loss of) money to our constituents,” C-TH board chairwoman Jo Saulisberry said. “We’ve done our best and tried real hard. If anything could go wrong, it went wrong at Cottonwood.”

n The good news. But, recent achievements at Valley Meadows have the employees and PDQ confident of their success.

Since Heinzen took over in January 1998, Valley Meadows has received its best-ever reviews by state inspectors. Losses are down and, in January of this year, the nursing home would have broken even if it had not been required to pay utility debts left in arrears by Premier, Heinzen said.

Pumphrey said as part of the venture, his group will back the enterprise and will make legally allowable concessions on the rent.

Jamie Filbin, assistant administrator at Valley Meadows, said proof of the nursing home’s potential success is its recent history. He said workers have come to the nursing home because of the potential for employee ownership.

“The only way the facility will operate successfully is through the employees, ourselves,” Filbin said. “We’ve made it work and I believe we can make this work.”

n Help requested. Elements of the tentative plan offered by the landlord, PDQ Investments, and Valley Meadows Living Care Inc., the proposed employee-owned operator, is contingent upon C-TH covering the facility’s first month’s payroll, about $217,000. They are also asking the hospital to sign over the nursing home’s equipment, its accounts receivable and cash on hand. The hospital must agree to transfer its license to the new operators and to refer patients to Valley Meadows as long as it is in good standing with the state.

The referring of patients is critical to the success of the operation, Heinzen said. Primarily because of the recent uncertainties about the future of the operation, Valley Meadows, which is licensed for 110 beds, had 97 patients on Thursday. To be successful, he said, the facility must be operated at near-capacity.

Court approval of the transfer would also be required.

In return, the partnership’s company would assume liabilities the nursing home has incurred since last November and PDQ would release the hospital from its lease agreement.

n Outside support. The employees’ proposal was supported by Babe Brown of Bishop, Calif., a former California state ombudsman.

Brown, whose mother lives at Valley Meadows, praised the facility. Brown said she had investigated complaints about many nursing homes when doing her job and later when looking for a place for her mother.

“Valley Meadows was the best place I found,” Brown said. “Change is very upsetting for the residents, it’s traumatic. Leave Valley Meadows open for as long as it can stay.”