Many skilled nursing providers across the United States have pivoted in recent years to diversify and build up other business lines. Santa Ana, California-based Generations Healthcare has been one such company, focusing on behavioral health – but with a newly opened SNF, the organization is returning to its roots in a familiar market.
The new Tustin Healthcare Center features 48 beds across 47,000 square feet. Located in the town of Tustin in Orange County, California, the former rehabilitation hospital sat empty for five years before getting new life under the Generations Healthcare banner. The grand opening took place on Oct. 15.
After Generations converted its previous Orange County SNF into a behavioral health facility with a special treatment program, hospital partners asked the company to reenter the SNF arena, Director of Business Development Thomas Jurbala told Skilled Nursing News.
So, the company began scouting for a suitable location; the Tustin building came on Jurbala’s radar during the COVID-19 pandemic but it was more recently that the timing finally seemed right to make a move.
“We started looking at it closer about a year and a half ago, that’s when we decided to acquire it,” Jurbala said. “I worked through all the different licensing organizations to get their pre-approval before we actually acquired the property, because it’s been closed for so long.”
Generations operates 35 skilled nursing, behavioral health, mental health, assisted living and substance recovery facilities across California, amounting to more than 3,500 beds. So, the company has no shortage of experience, which helped in bringing the Tustin project to fruition, given the significant hurdles that must be overcome to open a SNF.
“If we can add 48 beds back into the network, that’s huge, because that’s so uncommon,” Jurbala said.
Jurbala said the move made strategic sense not just because hospital partners were asking, but because the demand for skilled nursing is strong and the Orange County market already has embraced the Generations brand.
“Our headquarters is located probably 10 miles away,” he said. “At our Newport Beach facility, we had an unbelievable reputation there of great care and skilled nursing. When we left traditional skilled nursing to go into behavioral health skill nursing, there were a lot of people who were disappointed.”
The new facility also brings more than 300 jobs to the Tustin area. Generations currently employs more than 6,500 people across the state of California, with a target on recent graduates, Jurbala said.
“We have great relationships with all the CNA and nursing schools,” he said. “We really try to work with the younger students to give them an opportunity to learn from the best. … We love giving back to the community through jobs for those who are new graduates working in the industry or somebody who just wants to get a change from working at a local hospital.”
The 48 beds at the new Tustin Healthcare SNF also represent meeting the needs of the growing senior population in California. Jurbala said a lot of facilities are moving to behavioral health care or closing due to aging infrastructure that’s too expensive to bring up to new codes.
“In California, the overall geriatric population is growing quickly, but at the same time, skilled nursing beds are going away,” Jurbala observed. “A lot of the beds have closed down. They’re too old or they’ve been converted to behavioral health, such as we’ve done in some of our beds.”
Building from the ground up is particularly difficult. A Generations building in Temecula, California took four years to develop and two to build, for instance.
“You have a lot of regulations and it just costs so much money that you can’t build new,” Jurbala said.
While there are a few other companies, such as Ignite Medical Resorts, that are still pursuing ground-up development of new SNFs, the trend of SNF closures combined with a dearth of new openings threatens to compromise access to care across the country.
This backdrop makes the Tustin opening particularly noteworthy. And Jurbala added that once the facility is fully operational, the company plans to request an increase to 90 beds to further serve the community.
The new facility will be led by Administrator Devan Bennion.
“We are proud to open the doors of Tustin Healthcare Center and showcase all that this new facility has to offer,” Bennion said in a press release. “Our team is committed to creating a safe, modern and caring environment where patients can focus on healing, families feel supported and our staff can thrive.”
Looking to the future
Generations is looking to double the amount of beds the company has within the next five years. And expansion plans could include potentially reaching into nearby states. As has been the case for the last six years, behavioral health is the focus of Generations’ expansion plans. But growth in the SNF space is desirable as well, if the right opportunities present themselves.
“We would love to add more skilled nursing beds to areas that are in need of care, such as Tustin, because the senior population is growing,” Jurbala said.
But growth is about more than determining the right service lines and finding the proper real estate. The most critical factor, Jurbala said, is people.
Generations’ majority owners – CEO Thomas Olds and CFO Lois Mastrocola – have been driving the company’s growth since its founding 26 years ago, which he said provides a strong foundation for expansion.
“We have a really strong team with a lot of seniority and a lot of talent, and that allows us to continue growing and be able to add talent to the team,” Jurbala said. “Because finding good people is the most critical part of any company, and I think we’ve got some great, great people.”
