Quarry Hill, the Camden retirement community, sustained $4.4 million in operating losses over the past five years, while the Knox Center, in Rockland, lost $5.3 million over the same period, attributed, respectively, to an inefficient business model and an aging building. Those losses have been covered by Pen Bay Medical Center.

Coastal Healthcare Alliance, the nonprofit owner of both facilities and the hospital, wants to stanch the financial bleed. In doing so, proposes to eliminate its long-term, memory care and rehabilitation units at both Camden and Rockland locations and cede those functions to a for-profit company, which is standing ready to build a new longterm nursing home on Old County Road, in Rockland.

Leading that venture is Mike Tyler, a Camden resident and one of three principals of Sandy River Company, a Portland-based real estate business that builds senior care facilities and teams up with nursing home operators to run them.

There are, however, residents of Quarry Hill who are concerned about the disruption of a continuum of care that they said they had expected when they moved to the Camden campus.

“One of the primary reasons we moved to Quarry Hill was they had a complete range of care from independent living to long-term care right here onsite,” said Camden resident Jeff Dodge, who, with his wife, Deborah, purchased a cottage at Quarry Hill. “We feel betrayed by Maine Health. This plan to move these levels of care away from Quarry Hill have been in the planning for a very long time yet Quarry Hill continues to market itself as offering a continuum of care to its residents.”

Dodge is on the board of of Quarry Hill Associates, which includes the 45 cottage owners.

In the proposed development, and as it is being presented to residents and staff, Sandy River would form a limited liability company with North Country Associates, a Lewiston-based nursing home business, and build and operate a stand-alone senior care facility on a 20-acre Rockland parcel on Old County Road that is already owned by Sandy River.

The new LLC would then contract with MaineHealth, the umbrella nonprofit that owns the Midcoast Coastal Healthcare Alliance nonprofit, for a medical director to oversee the new facility. This new facility would comprise three units: Skilled nursing (short-term rehabilitation) and long-term, traditional nursing home for the elderly.

The units would be grouped in “houses,” said Tyler, with living rooms and small kitchen in each house. Those houses would be connected. (See graphic)

Sandy River owns the undeveloped acres on Old County Road, near an old Aqua Maine water tank, on a rise of land overlooking Penobscot Bay and which is bordered by private residences. The parcel has room for the new senior care facility, said Tyler, with room for expansion, if necessary.

He anticipates building and operating a 94-100 bed nursing home at this site, with residents and staff moving there from Quarry Hill and the Knox Center, sometime in 2022. That is providing the agreement is sealed, and all the local and state permits and certificates, which range from those governed by the City of Rockland to the Maine Department of Environmental Protection and the Maine Department of Health and Human Services.

The process would also require obtaining a contract zoning change before Rockland’s planning board and city council to comply with Rockland’s land use ordinance.

Tyler and his Sandy River business partners Daniel Maguire and David Friedman have been in the senior care development business for decades. Tyler first started his career at PenBay Medical Center, working in finance there from 1980 to 1987, before joining the Sandy River Company. 

He knows the Midcoast, and is confident the model his company employs has financial merit and staying power. He was also involved with establishing Windward Gardens, a for-profit assisted living, memory care and long-term care facility in Camden.

“This is what we do,” he said. “It is our business.”

It is harder for a hospital system, which focuses on primary and acute health care, to also cultivate the long-term and senior care business, said Tyler.

When MaineHealth called Sandy River to build and establish a new senior care center in Sandford, they worked out an agreement between the large statewide nonprofit and the private company.

More recently, MaineHealth approached Sandy River to help in resolve the situation in Camden and Rockland, said Tyler. That’s when he and Maine Coastal Healthcare Alliance President Mark Fourre started developing a plan.

The financial issue

According to Fourre, the aging physical building in downtown Rockland that house the Knox Center is inefficient to operate, both with its energy systems and layout.

At the Gardens (skilled nursing) at Quarry Hill, there are inefficient economies of scale: the 39 beds don’t bring in the revenue required to staff and maintain the facility.

Quarry Hill/Anderson Inn comprises the Gardens, Courtyard, a two-story assisted living facility, and a three-story apartment building. All are connected into one structure, and scattered around are cottages, which have been purchased by residents age 55 and older. 

“I would not say that assisted living is lucrative although it is possible to make ends meet,” Fourre said. “Assisted living has less demand for highly skilled personnel and is much less regulated than long term nursing care and skilled nursing (rehab) care.”

The landscape of senior care and nursing home facilities has changed over the past 40 years, said Tyler. More stringent licensing requirements coupled with resident expectations have contributed to a model that rests on at least 75 to 100 beds in a facility, not 39 beds.

“That’s a difficult size to run and make work,” said Tyler. 

The Quarry Hill long-term care and skilled nursing units, “are too small to operate cost effectively,” said Fourre.

With the proposed Old County Road facility, there would be 94 to 100 beds, all in private rooms, and one medical director contracted from Pen Bay Medical Center to oversee quality of care. The balance is in, however, not making room for more beds than needed.

Not so fast, some residents say

The news of the potential development has been roiling through Quarry Hill and the Knox Center for the last two weeks, and meetings with residents and staff at both places have taken place, with more to follow.

Residents, especially those who have purchased cottages or rent independent apartments at the Camden campus with the expectation of living our their years in one location, are asking questions.

“Moving longterm care and skilled [nursing care] miles from Quarry Hill will affect couples the most,” said Jeff Dodge. “For instance, if I have to go into longterm care and my wife remains living at Quarry Hill, we will be separated by miles and that will require transportation. If my wife can’t drive any longer, she will have to depend on transportation from Quarry Hill and that would be problematic at night and during weekends and holidays. What would happen if on Saturday night I went into a critical condition at this long term care facility some 6-7 miles from my wife and she couldn’t get to me because transportation was not available?”

Leigh Smith and her husband, Ron, purchased their cottage in 2003, after looking into retirement communities in Maine, Massachusetts, Connecticut, Washington state and California. They ultimately chose Quarry Hill because it, “had the most positives,” said Smith.

They bought their cottage on paper, before construction began. 

“It was one of the smartest decisions/moves we ever made,” she said.

Quarry Hill had just opened one year prior, and the cottages were still under construction in 2003.

The Smiths had anticipated being able to make, “lateral moves across campus, keeping the same phone number, etc.,” said Leigh Smith. “That was important to us. Many of those facilities in other states required several moves as senior needs increased. We want to be able to visit whichever one of us might require additional care at the Anderson Inn.  The present situation allows for a short walk from our cottage to Quarry Hill’s Longterm Care Unit.  So to have this situation change is disappointing to us.”

But Smith said that while the proposal was, “initially a dismaying surprise, we know life is filled with change.”

A former nurse in Massachusetts and California for 42 years, and worked in neurology/neurosurgery, oncology, urology/kidney transplants (living-related donor), post-op day surgery, and hepatobiliary/liver transplants (living-related donor) at the Lahey Hospital and Medical Center, she has watched leadership changes at medical facilities.

No hard decisions, yet

To Fourre, Coastal Healthcare Alliance and MaineHealth, the finances are glaring evidence that changes must be made.

“The Knox Center incurred $5.3 million of operating losses over the past five years due to an aging facility that is not designed to operate in an efficient manner,” said Fourre.

He said the conversation will continue. And, he said, that conversation will include what to do with the Gardens and Courtyard space, should Coastal Healthcare Alliance do away with skilled nursing.

“We have been asking the groups at both the Knox Center and Quarry Hill for ideas about how we could best use the Knox Center and the open space at Quarry Hill if the proposal goes through,” he said. “We have no definite plans as yet.”

As for the need for a new parking lot at the Camden campus, which the Town of Camden just approved for Quarry Hill, Fourre said: “I would anticipate needing to address parking issue going forward regardless of the outcome of the proposed new facility.”

For Dodge, however, there are lingering questions.

“Maine Health admits that they lose millions of dollars on long term care and skilled nursing,” he said. “Maine Health is a nonprofit. How can Sandy River and North Country, both for-profit companies, make money operating a long term care and skilled nursing facility without increasing the daily rate from about $383 per day that Quarry Hill now charges. Many of us would be priced out of this care.”

Leigh Smith said she and her husband are not leaving Quarry Hill.