Bancroft makes a fine recovery

Raymond Welsh never gave up hope for Bancroft NeuroHealth, the Haddonfield nonprofit organization serving developmentally disabled people from across the region.

The former Bancroft board chairman saw the institution's finances sinking about three years ago and recalled his letter to parents announcing an "extraordinary crisis."

Hammered by expensive lawsuits, record state fines, and long-term investigations by the New Jersey Office of Child Advocate, Bancroft seemed on the verge of closing.

But Welsh said he couldn't let that happen to the school that had been a second home to his son Randy, who lived in the Bancroft residential program for more than 13 years.

Two months before Randy died in 2004 from an inoperable brain tumor, Welsh sat at his son's bedside at the Hospital of the University of Pennsylvania and made a promise: "I told him, 'We will never let Bancroft fail.' "

Welsh, senior vice president of UBS Financial Services in Center City, donated $3 million and subsequently lent $2.75 million more to the financially ailing Bancroft. He also brought in new management that sold off money-losing operations and instituted major administrative and technological improvements.

Today, the institution that lost $13 million in 2004 is profitable again. It ran a $4 million surplus last year, is expected to have another surplus this year, and is fully accredited by the international Commission on Accreditation of Rehabilitation Facilities.

What's more, it meets most requirements set down by the state, which is expected to issue a largely positive report in about a week.

This month, Bancroft is working with the state to develop a videotape pilot program that could be used to ensure the safety of clients.

"It's extremely gratifying that we were able to get through all the problems. I'm thrilled to death," said Welsh, who serves on the institution's development committee and is expected to resume duties as a member of the board of trustees next year.

"Randy had a pretty happy life [at Bancroft], so it's rewarding to have memories of helping save the place."

Toni Pergolin, the organization's president and chief executive, said the "remarkable turnaround" happened "after severe challenges threatened Bancroft's very existence.

"We thought we were not going to make it," she said during a tour of the facility. "But we focused on the culture of the organization and when we saw problems, we acknowledged them and fixed them."

More than 1,300 brain-injured or developmentally disabled children and adults are served by Bancroft's programs in New Jersey and Delaware.

About 300 commute to the Haddonfield campus by bus from homes, supervised group homes, and apartments across the region, some from Pennsylvania, others from as far away as Vineland and Brick Township in South Jersey. About 60 live at the 20-acre Haddonfield site.

At its height, Bancroft had $80 million in annual revenue and was growing rapidly. In addition to campuses and major facilities across South Jersey, it had outpatient operations in Cherry Hill and a subsidiary in New Orleans.

But hard financial times hit in more recent years, stemming from lawsuits involving violence – including a teenager's death – scrutiny from regulatory agencies, reduced state reimbursements for students, and trouble getting some families to pay bills.

State and county authorities were called to investigate a series of crimes on the campus, including the stabbing of a teen resident and the rapes of two teen male residents. One family sued over the death of their 14-year-old son, who was allegedly restrained too long.

Bancroft was cleared of criminal wrongdoing, but drew attention from the Office of Child Advocate, which began a probe in early 2004. It found Bancroft at times had inadequate staffing and supervision and poor coordination of care. It also found tension and hostility between the organization and some families of children being served.

By June 2004, with investigations and money problems pressing, Bancroft was running out of financial options.

That's when Welsh and his wife, Joanne, of Haverford, stepped in with a $3 million donation in honor of their son Randy, who died in August at age 46.

Bancroft "was in such tough shape," Welsh said. "But I was convinced we could save the place."

Bancroft immediately dipped into the donated money to run the institution and its programs while Welsh, a member of Bancroft's board of trustees, looked for new management to streamline the organization.

He called upon a friend, Robert Martin, to be chief executive officer. He knew Martin from the University of Pennsylvania Health System, Martin's previous employer. Welsh was a trustee at the health system's Penn Medicine.

Martin "did a good job in shrinking the senior management team," and upgrading technology, said Welsh, who temporarily took over as Bancroft's CEO in October 2005 after Martin resigned for health reasons.

Welsh soon helped buy more time for Bancroft by providing a $2.75 million loan. And he looked to Toni Pergolin to lead the management team. Pergolin, a certified public accountant, came to Bancroft in 2004, serving as its chief financial officer, executive vice president, and chief operating officer before being named president in June 2006.

"Over the past two years, we've stabilized the financial crisis," she said. "We sold the program in New Orleans and the physicians outpatient operations [in Cherry Hill]. And we got a professional billing company to collect bills from the prior years."

At the same time, Bancroft raised employee salaries by 3 percent, improving staff retention. And it hosted quarterly meetings with family members, hired a family advocate to work with families, and provided information about grievance procedures.

"These are stressful relationships and the best way to build trust is to openly communicate," said Joseph Atkinson, Bancroft board chairman whose 13-year-old daughter is served at the Haddonfield campus. "The tone set with families has been helpful. It's been a great part of the turnaround."

Bancroft largely complied with the terms of a state settlement agreement by November 2006 and was monitored for several more months by the state Office of Child Advocate, which is expected to issue a report in about a week.

"Significant improvements have been made," said Tiffany Ellis, chief of staff at the Office of Child Advocate, who declined to elaborate on the forthcoming report. "We would like to see them sustain the improvements."

Kate Bernyk, a spokeswoman for the Department of Children and Families, said "Bancroft provides an important service for our children. We are encouraged by improvements under the new administration, and look forward to continuing our partnership with the facility."

Bancroft's Haddonfield facility may move to a new state-of-the-art campus elsewhere in Camden County, officials said. The nonprofit, which will celebrate its 125th anniversary next year, hopes to sell its campus on Kings Highway for at least $20 million.

Welsh never had a doubt about Bancroft's future. He promised Randy it would all work out in the end.

Randy "knew the place was struggling," Welsh said. "I wanted him to know that we were going to do everything we could to save the place. And we did with everybody pulling together."

The institution will celebrate its 125th anniversary next year. It has:

1,300 children and adult clients at campuses and major facilities in Haddon Heights, Haddonfield, Cherry Hill, Voorhees, Mullica Hill and Brick.

178 group homes and apartments in New Jersey and Delaware.

1,600 employees.

Classes, including art, music and physical education to help clients with hand-eye coordination and cognitive abilities.

Programs that teach vocational skills, preparing clients for jobs.

A recently upgraded Wawa convenience store at its Haddonfield campus, where clients learn about retail jobs.

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