Chicago nursing home that lost federal funding, may lose license wants nonprofit to take over

Chicago nursing home wants nonprofit to take over

CHICAGO — The owners of a troubled Chicago nursing home say they want to sell or lease the building to a nonprofit that could run it as a mental illness treatment center — a move quickly criticized by advocates of supportive housing.

A nonprofit organization could develop a “state-of-the-art” facility for the treatment of mental illness, Somerset Place administrator Nathan Langsner said in a written statement Monday. The owners have not named a specific nonprofit.

Federal authorities recently terminated Somerset’s government funding following citations for fights, verbal abuse and lack of supervision. In addition, Illinois is acting to revoke Somerset’s nursing home license.

Somerset until recently housed more than 300 mentally ill residents, but some of them have started to move into other facilities. The state’s public health department has a monitor visiting Somerset daily to make sure residents know their options.

A nonprofit could develop a facility with an acute care center, a residential unit and a transitional unit to prepare residents for less structured housing options, Langsner said.

But Janet Hasz of the Supportive Housing Providers Association said the goal should be to move residents into community housing. Supportive housing combines affordable apartments with services that help people manage their lives.

“Repurposing a very large building in this way is not the direction we want to go in Illinois,” Hasz said. The federal government won’t match state payments to such facilities, so Illinois pays twice as much as it would if the residents lived in other types of housing. “That’s way too expensive for the state,” Hasz said.

The for-profit Somerset Place received nearly $15 million in Illinois taxpayer money last year. Illinois taxpayers spend more than $122 million a year to care for the mentally ill in privately run, for-profit nursing homes — a system largely rejected elsewhere over costs, concerns about residents’ rights and quality of care.

Illinois officials said there’s plenty of space in other nearby institutions for residents who want to move.

The Department of Healthcare and Family Services has determined that there are about 120 available beds located in nursing facility Institutions for Mental Disease within five miles of Somerset.

The department said there are an additional 30 beds within six to 10 miles of the facility and an additional 110 beds within 11 to 20 miles of the facility.

This adds up to 260 beds within 20 miles. Department spokeswoman Stacey Solano said an additional 50 IMD beds are located 20 to 40 miles from Somerset.

Monday’s statement from Somerset Place was the first sign of how its owners may address the building’s future. The federal government is insuring a loan to Somerset and would be left holding the bag if the owners can’t make their mortgage payments.

The limited liability company that owns Somerset still owes more than $26 million on its government-insured loan, said Brian Sullivan, a spokesman for the U.S. Department of Housing and Urban Development.

HUD insures mortgage loans to help in the building and remodeling of nursing homes and other health care facilities. The program insures lenders against loss on mortgage defaults.