Archdiocese of Philadelphia sells nursing homes for $145 million

The Archdiocese of Philadelphia announced July 1 that it is selling six nursing homes and one assisted living facility operated by archdiocesan Catholic Health Care Services to a Flushing, New York, health care management company for $145 million.

The company, Center Management Group, owns and operates 15 nursing homes in New York and New Jersey. Under the agreement, the company has pledged to maintain the Catholic character of the nursing homes.

The date for the sale has not been set.

Under terms of the agreement, current nursing home staff members will become employees of Center Management Group at their current rate of pay when the agreement closes. They will receive health benefits under the new company's health care plans. The management group also has agreed to retain all residents currently living in the facilities.

The sale does not affect nursing facilities owned and operated by religious congregations, but only those directly owned by the archdiocese.

Under an agreement with the archdiocese, Center Management Group will operate each facility in accordance with the moral, ethical and social teachings of the church outlined in the "Ethical and Religious Directives for Catholic Health Care Services."

The health care management group will keep Catholic priests and chaplains and a pastoral care department at each facility. Existing chapels and places of worship will remain and Masses will continue to be celebrated.

The sale of the nursing homes, placed on the market last August, is part of the ongoing effort to address the financial problems that built up for decades which have jeopardized the ability of the archdiocese to cover employee and priest pensions as well as the deposits by the parishes into the archdiocesan-operated Trust and Loan Fund.

The $145 million sale price for the nursing homes will be decreased by certain obligations under the terms of the agreement. Coupled with the initial payment of $53 million for the long-term lease of the archdiocesan cemeteries, both deals will go a long way toward easing the financial crisis.

"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 Charles Chaput said in a statement. "I did not arrive at this decision lightly. It came only after a great deal of consultation, discussion and prayer.

In describing the archdiocese's financial status, he said: "We become a little more stable with each step we take. We still have a way to go, but everything is being done so that we can best fulfill the church's mission of evangelization and service to those in need."

"We are enthusiastic about the future and grateful for Archbishop Charles Chaput's confidence in our ability," said Charles-Edouard Gros, the CEO of Center Management Group, which he founded in 1999.

"We have the experience of maintaining Catholic presence in skilled nursing communities," he said. "Part of Center Management is to service the residents and the staff and to give the residents what they need to live optimally and happily and part of that is that they are able to practice their religion appropriately and have the love and support associated with that. We are very excited to be working with the archdiocese to maintain the same level of religious conviction and religious ability as to the residents of the facilities."

Gros received his master's degree in public health service management and policy with a concentration in gerontology from New York Medical College in 2001. He trained as an EMT/paramedic and still volunteers as a paramedic.

"I want to bring a high level of professionalism to the industry, coupled with my love for medicine," he said. "I have also always loved hotels and another dream I had as a child was owning hotels. Even if I haven't owned hotels, I've taken that philosophy of hospitality and brought it to the nursing environment. We hope to bring that to the forefront coupled with the strong Catholic basis in the community. It will be a special and wonderful environment for the residents."

Although the sale is generally expected to close before the end of the year, there are several conditions that must be met including Vatican approval for the sale, which has already been requested.

Center Management Group also must obtain the necessary licensing to operate the nursing homes. Both conditions are not expected to be problematic.