Incentive keeps Winchester House operating

Contract modifications and other incentives that could amount to $2 million were authorized Tuesday to keep the Lake County-owned Winchester House skilled nursing home running and a replacement facility on track.

The Lake County Board approved three measures involving the Libertyville facility that has been operated since 2015 by Transitional Care of Lake County LLC.

The main one extends the three-year lease and management agreement into a fourth year, if needed, because of construction or regulatory delays. It also provides added incentives to address revenue shortfalls.

Instead of shutting down Winchester House, Transitional Care will continue working with the county to overcome "operational and development issues" it has faced with the goal of soon moving residents to a "modern, much improved" facility, according to a resolution approved by the board.

Two other measures cut in half the sewer connection fee to $417,182 and provide an easement to connect village water to a new 185-unit skilled nursing home to replace Winchester House. It would be located north of Route 45 - between the former Menards store and the Dover Straits restaurant - in Mundelein.

As the review of that plan continues in Mundelein, Lake County needed to adjust the contract to address a shortfall attributed, in part, to "unforeseen, inaccurate and lower-than-expected" number of residents. And some of those residents have no source of payment identified by a prior management company, according to information provided to the board. Unanticipated expenses for health care and workers' compensation also were cited.

Winchester House's population was reported at 169 when the agreement was struck in 2015 but stood at 126 last fall, County Administrator Barry Burton said.

"The loss of those 40 residents costs them a couple of million a year," Burton said.

About 80 percent of Winchester House residents rely on Medicaid, a federal-state health insurance program for low-income people.

"We want our residents to have a place to go regardless of their ability to pay," he said.

The company, which pays rent and utilities for the building at Winchester Road and Route 21, shut down the west wing. About $500,000 in costs will be forgiven, Burton said.

The contract modification also calls for the county to forgive $1 million in startup capital, provided Transitional Care closes on the Mundelein property and solicits bids for construction. That amount won't be forgiven if construction does not begin by June 22, 2018, according to the agreement.

The hope is ground will be broken this spring, with 18 months for construction, Burton said.


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