Hutcheson Medical Center plans to sell its nursing home, Parkside at Hutcheson, as the publicly owned Fort Oglethorpe hospital looks for a new partner to manage its operations.
"I just hope if anybody buys it, it stays like it is," Wanda Parrish said Wednesday afternoon as she walked into the 109-bed nursing home on Hutcheson's Fort Oglethorpe campus to visit her 88-year-old mother, Verna Bean, who's lived there about five years. "We've been real satisfied. They take good care of her, and it's real clean."
Hutcheson spokeswoman Stacey Kaufmann said the nursing home is profitable and now is 85 percent full. Hutcheson wants to sell it, she said, so it can focus on its core hospital business.
"Many hospitals are divesting of noncore businesses [such as nursing homes or property management] in order to focus on core hospital service lines and operations," Kaufmann said via email.
She declined to say specifically who might buy the hospital or what it's worth. The nursing home is being shopped around by Ken Conner, a principal at Decosimo Accountants and Business Advisors in Chattanooga, who's putting together the request for proposals for Hutcheson to find a new partner as it ends its current management agreement with Erlanger Health System of Chattanooga.
"[Conner] contacted several qualified candidates with nursing homes in Georgia, as well as several large systems who could be competitive in their offers," Kaufmann said via email. "All parties signed confidentiality agreements, and we are in ongoing negotiations."
Hutcheson Medical Center has about $60 million in debt. When Catoosa County commissioners on Tuesday offered to refinance $35 million of that, one of the conditions was that Hutcheson sell Parkside and use the proceeds to fund hospital operations, buy new equipment or pay debt.
A nursing home's value depends on things such as what percentage of patients are private payers versus Medicare and Medicaid users, said Greg Vital, president of Independent Healthcare Properties LLC in Collegedale, which has assisted living and Alzheimer's care facilities in Tennessee and four other states.
"Think of it as a hotel," Vital said. "A 100-bed Budgetel ... is worth less than a 100-bed Hyatt Regency."
Parkside's value will become public information once the sale proceeds, Kaufmann said.
"The bid process is considered strategic in nature and therefore privileged information until the sale is official -- at which point we can release ... the sale amount," she said in her email.
Contact Tim Omarzu at firstname.lastname@example.org or 423-757-6651.