DeKalb County nursing home bidders to join forces after pending sale

SYCAMORE – Once the approximately $8.3 million sale of the DeKalb County Rehab and Nursing Center is finalized, possibly later this year, both health care companies who sought to buy it will now have a hand in running it, county officials have confirmed.

DeKalb County officials learned a few weeks ago that Evanston-based Illuminate HC intends to work with the leadership of Skokie-based Saba Healthcare once the nursing home sale is final, County Administrator Brian Gregory said. Principals of the two companies have created DeKalb Healthcare Holdings LLC, records filed online with the Illinois Secretary of State’s office show.

“The principals of Illuminate and Saba have joined forces to acquire and operate the facility,” county officials wrote in documents released ahead of the board’s meeting set for Wednesday.

Neither Illuminate or Saba healthcare companies could immediately be reached for comment.

DeKalb County Board Chair Suzanne Willis, a Democrat from District 10, said she was taken aback when she first heard about the collaboration but also said she can see why the partnership formed.

“The idea that they would join forces is not – strikes me as not – outlandish, particularly when apparently what happened is that Illuminate was not able to raise their money on their own and they needed to do something about that,” Willis said. “So to find a partner in these people who are basically next door and also had an interest in the nursing center in the first place certainly would make sense for them.”

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In July 2022, the DeKalb County Board voted to sell the DeKalb County Rehab and Nursing Center after years of alleged mismanagement, delinquent billing and falling resident numbers created $7 million worth of county debt. During the bidding process, DeKalb County Board members expressed interest in how the company would operate after the sale, including if it would continue to work with American Federation of State, County and Municipal Employees No. 3537, the union that represents the nursing center’s employees.

During deliberations last summer, an Illuminate HC official texted a DeKalb County official and said the company would “welcome the union with open arms.” Now, according to county documents, however, county staff and legal counsel have had conversations with Illuminate HC to reaffirm the representations made to the County Board last year will continue to be accurate given the combined operating ownership that’s expected.

It’s clear that we need to proceed with the sale, there is not really a sensible alternative at this point.”

—  Suzanne Willis, Democrat and DeKalb County Board chairperson

Gregory said Illuminate HC’s intention to bring in Saba’s company leadership doesn’t change status of the agreement the county made for the pending sale of the rehabilitation and nursing facility.

“With these types of transactions there’s a single purpose entity or an LLC that’s established so the make up of the LLC – it could be different principals. Now one of them was someone that we’ve been familiar with throughout this process and there may be other principals that we were unaware of and may not know who those names are,” Gregory said.

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Chuck Simpson, President of AFSCME Local 3537 and a 33-year nursing center employee, spoke against the partnership between Illuminate and Saba healthcare companies in a statement provided to the Daily Chronicle.

“We’re disturbed to learn that Illuminate HC, the potential buyer of our county home, has entered into a partnership with Rothner-affiliated Saba Healthcare,” Simpson wrote, noting that the board voted 19-3 against selling it to Saba. “... With the news of Illuminate’s partnership with Saba, the board should stop the sale.”

County officials said they were given verbal assurances of the buyer’s continued cooperation with the union, documents show.

Gregory said county staff members asked several questions when they found out Illuminate HC and Saba Healthcare had partnered together. Those questions were based on concerns brought up by the public during meetings regarding the sale.

Gregory referenced comments made during a July 2022 DeKalb County Board meeting where Saba Healthcare representative Moshe Blonder addressed concerns about Saba’s potential business connections to a property management company that has been the subject of controversy in DeKalb.

Evanston-based Hunter Properties, once DeKalb’s largest landlord, was at the center of legal troubles with the city of DeKalb. Hunter-owned rental properties faced hundreds of DeKalb code violations. In 2021, the city of DeKalb entered into a contract with Hunter Properties, mandating the company sell its largest DeKalb properties.

County Board members in July 2022 asked whether Saba Healthcare does business with Hunter Properties, after concern was raised as to Saba’s association with Eric A. Rothner, who is listed as a manager for Hunter Properties LLC, according to state business records.

“In full transparency, I do have some financial investments, not with actual Hunter Properties,” Blonder said in response during the July 2022 County Board meeting. “I’m not affiliated with that. I do have some financial investments tied in with one of the people from the Rothner family who happens to be related to that. But I operate completely separate.”

Blonder and Aharon Singer are both listed as managers for Saba Healthcare LLC, according to state business records.

Willis said she thinks the decision to bring in Saba Healthcare’s principals was done in good faith.

Willis – who last July voted against Saba Healthcare’s bid in favor of Illuminate’s offer and in favor of a failed bid to place a referendum on the ballot regarding the nursing center’s future – also stressed how transparent she thinks the process to sell the beleaguered nursing facility has been.

“I like the transparency, it could certainly have happened with much less transparency than it has, and I feel that we are now fully aware of what’s going on on the buyer’s side, and who the buyers are and what their contributions are ... it’s good that we have that transparency,” Willis said.

Gregory said there isn’t anything unethical about the partnership between Illuminate HC and Saba Healthcare. Gregory said out of an effort to be transparent about the Illuminate HC and Saba Healthcare partnership he’s proposed a resolution that authorizes him to execute the final steps of the sale.

According to county documents, the resolution confirms the company’s revised structure and will be up for consideration at Wednesday’s County Board meeting.

“We were being transparent,” Gregory said of the resolution. “Throughout this process we’ve been very transparent since day one.”

When will the sale close?

The County Board voted to approve the sale last October. The process also needs approval from the Illinois Health Facilities and Services Review Board, which next meets May 9.

Gregory said documentation is ready to go if the County Board votes to authorize him to sign it. The closing likely will happen on the first of a month and could be as early as June 1. Gregory said it’s more likely the state review board won’t consider the application until June 27, however, which could push the closing date back to Aug. 1.

Within the resolution is a clause that says if the closing date occurs after Aug. 1 DeKalb Healthcare Holding LLC will cover up to $200,000 in losses per month to the county. Gregory said that number was decided upon because it is roughly the amount of debt the county takes on through the facility each month, but the clause would only be activated if the sale were slowed by Illuminate HC.

Despite the uncertain closing date, the sale is expected to move forward as planned, Willis said.

“It’s clear that we need to proceed with the sale, there is not really a sensible alternative at this point,” Willis said.