Albany Care & Nine Affiliates: Not as "Unprofitable" as They Seem…read moreWarning: this is a true deep dive. If you are curious about what the heck is going on over at Albany Care, I think you'll benefit from understanding more about its business structure. To do so, anyone can access Albany Care's finances on IDPH's website via their annual cost reports. A quick glance and you'll see its net income in 2023 was a big loss of -$3,217,144. Ouch. And yet, as will be outlined through this post, the owners made at least $700k in profit from 2023 operations, not counting additional equity captured through $2.8 million in lease payments to related parties.
The reality is that Albany Care and its nine nearby "sibling" Specialized Mental Health Rehabilitation Facilities & Nursing Homes are part of a united ownership group who pulled at least $6.3 million of total profit out of their 'unprofitable' Illinois mental health rehabilitation clinics in 2023. I'm not saying that these are shady community members egregiously stealing money - not at all. If anything, they have built an impressive system to care for patients and make money through Medicaid reimbursements. The reason I'm shining a light on this is because 82% of their $110 million revenue came from tax dollars (Medicaid/Medicare) and they provide vital health care to vulnerable populations --- they can handle a modicum of public financial scrutiny. My intention is not to disparage anyone.
How do you make profit on a conglomerate of healthcare businesses that ran a $10.9 million net loss in 2023 via the IDPH filings? They do it through related-party rent payments, "consulting fees," and other line items IDPH flags as not related to patient care. It's legal and common in this line of work.
This post is just one Evanstonian's attempt to unpack the financial operations that underpin Albany Care for community awareness. I'm happy to share the spreadsheet of data, links to IDPH cost reports, and will make edits if anything here is misstated or miscalculated.
Who am I and why care: I live a few blocks away, have an MBA, and got curious when I saw Albany Care's 2023 cost report on the Illinois Department of Public Health (that's IDPH) site. The "related-organizations" page sent me down the rabbit hole. I pulled every 2023 filing for the ten linked organizations, stacked the numbers, and here we are.
The complexity of Albany Care's organizational web: Via the public cost reports, Albany Care is part of at least 10 IL healthcare facilities that share owners / management companies (I'm leaving off the non-IL entity in my analysis b/c I can't easily research it):
Albany Care - Evanston
Greenwood Care - Evanston
Decatur Manor - Decatur
Generations at Applewood - Matteson
Generations at Neighbors - Byron
Generations Oakton Pavilion - Des Plaines
Generations at Regency - Niles
Generations at Rock Island - Rock Island
Bryn Mawr Care - Chicago
Wilson Care - Chicago
The ownership map centers on a small circle of inter-locking family trusts. All are named in the IDPH filings. The Rothner family sits at the center. Close behind are the Wolff family, the Barrish family, the Giannini family, the Robinson family, the Vales family, the Matthew family, the Gesualdos, and the Winters. Scattered beneath the major blocs are a long tail of sub-one-percent holders.
Those same families also control a lattice of related-party entities that channel money out of the operating facilities like Albany Care. Albany Care LLC and a collection of property-specific landlord shells (Neighbors Property LLC, Oakton Arms LLC, Bryn Mawr Care Inc, etc) own the real estate and receive roughly $15 million in total annual rent payments from all orgs. Over that sits Generations Properties LLC and SIR Properties LLC, master holding companies for multiple buildings, while Generations HC Network LLC and the legacy SIR Management LLC bill each facility for "administrative and consulting" services. Vertical integration extends to vendors such as MAC Rx LLC (pharmacy), LTC Lab LLC (lab work), and Big Ten Supply LLC (medical supplies), all disclosed as 100% related orgs. Together these affiliates absorb rent, management fees, and supply margins --- allowing the operating companies (like Albany Care) to show paper losses even as cash flows into the same ownership circle. It's a complex web and it's all openly viewable in the public record and legal. Its also not inherently "bad." It's just business.
Method I used to create a financial summary of this conglomerate of related businesses:
I opened 2023 IDPH cost reports for each separate entity, which conveniently lists every related business with overlapping ownership for public awareness, and dumped key lines into Excel.
I added the numbers together so the 10 IL facilities look like one business.
I wanted to see what the owners actually pocketed, so I added up three things:
Cash paid to owners / relatives / board - this is literally listed in admin costs for each facili