July 17, 2008
Spotsy Nursing Center is Sold: Carriage Hill Nursing Home Has Been Sold to a Partnership of Two Roanoke Companies
By Jim Hall, The Free Lance-Star, Fredericksburg, Va.
Jul. 17--Carriage Hill Rehabilitation and Nursing Center, the region's second largest nursing home, has been sold.Officials of MediCorp Health System said yesterday that two Roanoke companies have agreed to pay $13.35 million for the Spotsylvania County home. The transfer is expected within 90 days.
Commonwealth Care and Smith/Packett Med-Com will share equally in the ownership of the real estate. Commonwealth Care will operate the facility.
Employees, residents and families learned about the sale at meetings Tuesday and yesterday.
Deborah Petrine, president of Commonwealth Care, said yesterday that Carriage Hill will continue to operate as a nursing home. The company also will retain its Alzheimer's unit and its rehabilitation wing, she said.
The staff of 132 people will keep their jobs at their current salaries, she added. Nicole Threatt has agreed to stay on as administrator, and Rod Coleman will remain as director of nursing, she said.
"We think it's a very quality facility," Petrine said.
Carriage Hill is one of five nursing homes in the region and the only one that is locally owned. It opened 22 years ago off State Route 3. At present, 101 people live there.
Both Commonwealth Care and Smith/Packett are privately held, for-profit companies. MediCorp is a nonprofit company and the parent company of Mary Washington Hospital and the planned Stafford Hospital Center.
Founded in 1982, Smith/Packett bills itself as one of the nation's largest developers of senior housing.
In March, Smith/Packett received permission from the Stafford Board of Supervisors to develop a 22-acre retirement community on Berea Church Road.
The project will have 436 units, divided among condominiums, independent-living apartments, assisted-living units and a nursing home.
Commonwealth Care, founded 7 years ago, operates seven other nursing homes in Virginia, with an eighth soon to open. Its closest homes are in Manassas and Gainesville.
The two companies have worked together for more than a decade.
MediCorp began considering offers for Carriage Hill earlier this year.
Walt Kiwall, executive vice president and chief operating officer, said yesterday the company set three conditions for prospective buyers:
That the home continue as a long-term care facility.
That residents receive quality care.
That employees be treated fairly.
MediCorp chose Commonwealth Care and Smith/Packett from among several bidders. MediCorp's board of trustees approved the sale last week.
Carriage Hill ran into regulatory trouble last year. The home lost its Medicare and Medicaid funding in May after a series of inspections found numerous problems, including the apparent accidental strangling of an 83-year-old resident. The home was reinstated to both programs earlier this year.
Despite the loss of government funding for seven months, the home had revenue of $6.3 million last year, according to MediCorp's audit.
The home remained open with about 100 residents, and expenses totaled $10.8 million. The loss for the year was $4.5 million, according to the audit.
In most years, Carriage Hill showed a small profit on revenue of about $10 million, said Fred M. Rankin III, MediCorp's president and CEO. Annual revenue for MediCorp and all of its subsidiaries is about $500 million.
"It was an important part of our operation but a small part," Rankin said.
Rankin said the regulatory troubles and the work needed to restore Carriage Hill to the government programs taught MediCorp officials that the long-term care business is unique.
"The lesson for us is that it's a different business," Rankin said. "The best we could do was find a company that knows that business."
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