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March 2, 2020

New Britain’s Jerome Home eyes $10M expansion, debt refi

Contributed rendering A rendering of Jerome Home's planned 19,000-square-foot assisted living expansion in New Britain.
By Matt Pilon

Seeking to bolster its finances and meet rising demand for dementia and Alzheimer’s care, New Britain’s Jerome Home hopes to break ground next month on a $10-million expansion.

Administrators of the 88-year-old nonprofit skilled nursing and assisted living facility, located along Corbin Avenue, are pursuing a borrowing as high as $20 million through the Connecticut Health and Educational Facilities Authority (CHEFA), a quasi-public agency that issues tax-exempt bonds.

The money would fund the construction and furnishing of a 19,000-square-foot, two-story addition containing 20 new memory care assisted-living apartments and a 5,000-square-foot rehab gymnasium.

The borrowing would also refinance approximately $8.8 million of debt related to a 2008 expansion that represented Jerome Home’s initial foray into assisted living. The 62 units built at that time included 16 memory care units.

The assisted living portion of Jerome Home is known as Arbor Rose.

When the new project is complete early next year, Arbor Rose will have 39 memory care units and 84 total assisted living beds, in addition to Jerome Home’s existing 120 skilled nursing and residential care beds.

Matt Pilon
William Menoche and Lori Toombs, the executive directors of Arbor Rose and Jerome Home, respectively, at the entrance to the facility's dining room.

In an interview last week, William Menoche and Lori Toombs, who are executive directors of Arbor Rose and Jerome Home, respectively, said expanding on the facility’s 12-year-old memory care units, which are often fully occupied, meets a demand and represents a wise financial move.

Jerome Home, which is owned and operated by a trust and has a longstanding management services contract with Hartford HealthCare,  is relatively healthy, usually posting positive operating income, but rising costs -- minimum wage hikes totaling hundreds of thousands of dollars in added costs, as well as health insurance and building maintenance expenses -- have pressured trustees to take action to ensure things stay that way.

“Arbor Rose has been a great resource to Jerome Home because we’re able to move residents from one level of care to another, so it kind of does help us financially a little bit,” Toombs said. “We’re not looking to make a huge profit, but, looking 10 years down the road with expenses, we wanted and needed to do something.”

The project, which has been in the works for over five years, will also bring Arbor Rose into line with others in the assisted living industry, where 80 or 90-unit facilities are more common, Menoche said.

“Unfortunately there is a need,” he said. “Occupancy for memory care is pretty much full all the time.”
Menoche said the campus had enough space to build as many as 40 new memory care apartments, but trustees were mindful about taking on too much debt.

Over the years, Jerome Home acquired several residential homes on the northeastern edge of its campus, along Hamilton Street. Those homes are now demolished, which make way for the larger facility and a new parking lot.

As is common in assisted living facilities in Connecticut, virtually all of Arbor Rose is private pay. Most people and families pay out of savings or out of pocket, with a handful covered by private long-term care insurance.

A memory care unit at Arbor Rose can run approximately $6,000 a month, so it’s not cheap, but Menoche said trustees, mindful of that cost, chose to limit the size of the new units to keep the price as low as possible.

It remains a challenge for residents and Jerome Home alike, he said, as some spouses or families, wanting to keep a family member with dementia home as long as possible, wait long enough that the patient is sometimes no longer a fit for assisted living, but must seek more comprehensive (and more costly) skilled memory care.

Jerome Home doesn’t offer skilled memory care, but it’s an option its overseers are weighing for the future.

As the state’s population ages, Menoche is convinced the state will be forced to step in at some point -- perhaps in the next decade or two -- to subsidize assisted living.

“They’re going to have to,” he said. ”Because it’s cheaper to stay in assisted living and get the care than it is to go to a nursing home.”

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