Hospital District completes acquisition of the Village at the Harbor, starts rolling out staffing and facility changes

On Monday, Feb. 28, the San Juan County Public Hospital District finalized its $4.8 million purchase of the Village at the Harbor, a 36-bed long-term care facility located on Spring Street.

With the sale complete, the PHD now embarks on an ambitious plan to ensure the continued availability and eventual expansion of long-term care services on San Juan Island. The PHD aims to maintain the Village’s existing private-payer model, while at the same time adding substantial capacity for lower-income residents on Medicaid, establishing a program to help seniors age in place, providing stability for the Village’s staff, and improving its facilities.

One of the major staffing changes took place the day following the acquisition, when all employees working 32 or more hours per week were provided medical, dental, and vision coverage, along with retirement benefits and paid time off. None of these benefits had been offered while the Village was under private ownership.

Employees also received wage increases of roughly ten percent on March 1.

Those changes “were an extremely important step in the acquisition process,” according to Nathan Butler, PHD superintendent. “It allows for a higher level of employee retention. Currently, the healthcare field is experiencing an extreme deficit of healthcare workers. To ensure that employees are incentivized to remain at the Village at the Harbor long term instead of seeking employment elsewhere, it was important that the Hospital District offer competitive wages and benefits packages.”

Patient care within the facility and beyond will see improvements in the near future. With funding from the PHD, the Village has been able to add two new full-time nurses to provide more comprehensive care to residents. The District also aims to hire three home healthcare workers in mid- to late 2022 for a new program designed to help Island seniors age in place, instead of at an assisted living facility like the Village.

In addition, the PHD intends to increase its subsidy to Mount Baker Planned Parenthood by $45,000, and to provide $10,000 in support of healthcare needs for the Island’s LGBTQ community – although further details about those initiatives are not yet available.

The PHD has also begun to address deferred maintenance at the facility, which was acquired by way of a $5 million, 20-year bond held by SaviBank of Friday Harbor. New laundry machines have been purchased, more than $70,000 in replacement furniture will be acquired within the next few months, and staff are assessing the possibility of installing new carpet throughout the building later this year.

One of the PHD’s key mandates for the Village – adding capacity for lower-income residents in need of long-term care – will take longer to complete. The initial step in that process involves setting aside for residents on Medicaid the four or five beds that typically go unoccupied due to resident turnover.

“Currently, we are in the process of applying for our Medicaid license, as we just got our license to operate the facility under the Hospital District,” said PHD Public Information Officer Hannah Johnson. “We will have more news on this to come later in the year.”

The PHD aims to eventually expand its Medicaid capacity to between 20 and 30 beds, but that goal is contingent on the sale of an additional 20-year bond for an estimated $2.5 million. The funds would be used to add ten to fifteen rooms to the Village in a major construction project that would start in 2023 and wrap up by the end of 2025.

The expansion is central to the Village’s ability to serve lower-income residents. In the facility’s current configuration, accepting more Medicaid patients would generate substantial financial losses, because it would make those rooms unavailable to residents paying market rates. Splitting the rooms to allow for two occupants instead of one would address that issue, however by law Medicaid patients must be provided a certain amount of square footage, and most rooms at the Village would not meet that requirement after being split. A few of the facility’s apartments are large enough, but according to the PHD the design of those rooms does not lend itself to accommodating multiple residents.

Each of the ten to fifteen rooms added under the expansion project – at an estimated cost of $100,000 to $150,000 each – would be designed with the intention of hosting two patients.

Additional Medicaid capacity was one of the primary goals put forth by the PHD as it sought community support for acquiring the Village at the Harbor. The sale moved forward after a levy lid lift proposition passed with 54.3 percent support in the November 2021 general election.

The lid lift more than doubled the PHD’s regular property tax levy from $0.34 per $1,000 of assessed value to $0.70 – or roughly $180 per year for a property assessed at $500,000. It is expected to yield approximately $1.6 million in additional funding in 2022, of which roughly $325,000 will go toward this year’s debt service for the 20-year bond used to purchase the Village. The $2.5 million expansion bond would require an additional $165,000 in annual debt service.

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