The Archdiocese of Philadelphia has agreed to sell six nursing homes and one assisted living facility for $145 million to the Flushing, N.Y.-based Center Management Group, which currently owns and operates 15 nursing homes in New York and New Jersey.
The facilities included in the sale are Immaculate Mary Home, St. John Neumann Nursing Home, and St. Monica Manor in Philadelphia; Villa St. Martha and St. Martha Manor in Downingtown; St. Francis Country House in Darby; and
St. Mary Manor in Lansdale.
The archdiocese said the sale of the properties is part of its efforts to restore its fiscal footing. It reported a $39.2 million operating deficit for the 2012 fiscal year as well as hundreds of millions of dollars in underfunded balance sheet liabilities. Since the summer of 2012, it has taken steps to remedy the fiscal problems, according to a June 30 archdiocesan statement.
Kenneth A. Gavin, communications director for the archdiocese, said the financial challenges arose due to a series of poor management decisions made at various levels within the archdiocese over more than two decades. The steps to rebuild a firm fiscal foundation included the sale of the archbishop's residence and a New Jersey property. The workforce at the Archdiocesan Pastoral Center was reduced by 25 percent. The archdiocese also entered into a long-term lease with StoneMor Partners for archdiocesan cemeteries.
The Catholic eldercare facilities have been operated by Catholic Health Care Services, which has been well-managed for many years, according to the archdiocese. The archdiocese announced last summer that the facilities would be marketed for potential sale. A closing date hasn't been set, but will likely be before the end of the calendar year, Gavin said.
Archbishop Charles J. Chaput, OFM Cap., who began serving as Philadelphia archbishop in 2011 and has expressed a commitment to financial transparency, said in a statement, "This agreement will serve the archdiocese and its people well by ensuring the nursing homes presently operated by Catholic Health Care Services will continue to be dignified centers of care for the elderly in the Catholic tradition and in accord with the moral and ethical teachings of the Church." Archbishop Chaput previously served as bishop of Rapid City, S.D., and archbishop of Denver.
Under the for-profit Center Management Group, the facilities will operate in accordance with the Ethical and Religious Directives for Catholic Health Care Services; Roman Catholic priests will retain a presence as chaplains and pastoral care departments will continue; an advisory board will assist the management group on issues related to Catholic identity and practices; and Mass and the sacraments will continue to be regularly celebrated at each facility, the archdiocese said.
A stewardship agreement between the archdiocese and Center Management Group is intended to ensure the Catholic identity of the facilities involved in the sale. The archbishop may revoke the Catholic identity if Center Management Group fails to operate a facility or services within the terms of the stewardship agreement, or fails to correct deficiencies in a reasonable time frame.
The archdiocese said current residents will remain in the homes regardless of payer status. Center Management Group has guaranteed fair treatment of current employees, who will retain their current rate of base pay and receive reasonable packages if the employee is not retained in the first year, unless the employee is terminated with cause.