Sonoma Valley Hospital finalizing deal for skilled nursing facility's future

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After several operational moves last year to cut costs that included possibly shuttering its skilled nursing facility, Sonoma Valley Hospital has announced it is finalizing a plan that would keep the unit on the hospital’s grounds.

Hospital administration is working on a proposal with the Ensign Group, a national operator of skilled nursing and rehabilitative care services, to assume operational management of the nursing unit.

Under the proposal, in addition to staying put, the facility would expand services to include subacute care, according to Joshua Rymer, chairman of the hospital’s board of directors. In addition, it would remain under the hospital’s license with administration and board oversight, and the hospital would not be liable for any losses if they were to occur, he said.

“We are in final negotiations and do not have a hard date, (but) I believe it will be done by June,” said Kelly Mather, CEO, Sonoma Valley Hospital, which is an affiliate of UCSF Health.

The next step would be for the board to review and approve the terms, with operations expected to take effect by July 1.

“I firmly believe that this is a positive and necessary step that will strengthen services offered to the community while putting the operation on a more stable financial footing; one which will generate incremental revenue for the hospital instead of the current situation where we are losing money,” Rymer said in the May 9 announcement that followed the May 2 board meeting. “SVH will receive revenue from Ensign both as part of a revenue-sharing agreement, and by providing certain medical and operations services to Ensign.”

Ensign operates 254 health care facilities, including 197 skilled nursing facilities, in 16 states, Rymer said.

“(Ensign) has the expertise and resources to make our SNF financially viable in ways that our own staff, despite their strong efforts, could not,” he said.

Ensign has made job offers to all but one of the existing staff members of the nursing unit, he added.

The skilled nursing facility — which cares for patients who require less than acute care — has a projected $880,000 operational loss for fiscal year 2019, Mather told the Business Journal in late October. The hospital’s board approved a task force last summer to evaluate the facility’s future.

Last year, the hospital closed its obstetrics unit and transferred ownership of its home-health care facility, Healing at Home, to Hospice by the Bay, a regional not-for-profit organization and UCSF affiliate.

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