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State Of Kansas Takes Control Of 15 Financially Troubled Private Nursing Homes

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Tim Keck, secretary of the Kansas Department for Aging and Disability Services, says the state is moving quickly to find a new owner for the nursing homes.

The owner and operator of 15 Kansas nursing homes has consented to be placed in receivership after defaulting on payments to vendors and failing to meet payroll.

Kansas Department for Aging and Disability Services Secretary Tim Keck has been appointed receiver and will oversee operations of the homes, which are scattered across the state.

The owner, Skyline Health Care LLC of Wood-Ridge, New Jersey, previously acknowledged that it had insufficient funds to pay basic utilities and food service vendors.

The 15 Kansas facilities have about 845 residents and 950 employees, according to court documents. Three of the nursing homes are in Wyandotte County, one is in Johnson County and one is in Leavenworth County.

Keck said that Mission Health, a Tampa, Florida-based operator of nursing homes that already operates 14 skilled nursing facilities in Kansas, has assumed day-to-day oversight of the Skyline nursing homes.

“They have done a really good job of getting things organized and back to some level of certainty in the last week or so,” Keck said.

The next step, he said, is to find a new owner.

“It may or may not be Mission Health,” Keck said. “I don’t know if they will be interested in it or not. We have heard from several people that they are interested in some or all of the facilities.”

“Our end goal,” he added, “is to get all the facilities back on sound footing with some certainty and then turn them over to another operator in the next few months. We’ve got a pretty aggressive timeline.”

Mission Health has operated in Kansas since mid-2015, when it took over facilities previously operated by Deseret Health Group, which had become insolvent. In that case too, the Kansas Department for Aging and Disability Services facilitated the takeover.

Northjersey.com, a Gannett-affiliated website, reported Monday that Skyline had received millions of dollars in Medicaid revenues for the care of thousands of elderly residents in eight states. It said that Skyline, which operates out of a second-floor office above a pizzeria and barbershop, had expanded rapidly in the last couple of years, acquiring dozens of skilled-nursing homes from financially troubled chains.

Last month, Nebraska health officials placed 21 nursing homes and 10 assisted living facilities operated by Skyline in receivership. Kansas officials moved to take over the 15 facilities in Kansas five days later.

Keck said that legal action against Skyline could be in the offing.

“I think that's something we will attack on many fronts, probably through some litigation,” Keck said. “And we probably need to take a fresh look at our regulations on that, as to what the state has the ability to look at going forward. … But I can tell you we’ll be very aggressive to make sure that Kansas gets what we're entitled to make us as whole as possible when it's all said and done.”

Skyline is owned by Joseph Schwartz. A bio he provided to the Pennsylvania Department of Health says he was born and raised in Brooklyn, New York, and is married with four children. It says he began his career in 1986 as an independent insurance broker and “has built a profitable portfolio of real estate investments throughout the North East Region.”

The bio goes on to say that Schwartz founded Skyline in 2005 “with the purpose of purchasing and managing health care facilities.” From November 2015 to the present, it says, he has acquired 76 health care facilities, including the ones in Kansas.

Calls to Schwartz were referred to Juda Engelmayer, president of a public relations firm called Herald Strategies. Engelmayer said Skyline was not trying to run away from its problems but it wasn't in a position to discuss them now. 

"I expect within a week you'll be hearing from me," he said. 

Here's a list of the 15 nursing homes: 

  • Chase County Care & Rehabilitation Center
  • Downs Care & Rehabilitation Center 
  • Edwardsville Care & Rehabilitation Center
  • El Dorado Care & Rehabilitation Center
  • Eskridge Care & Rehabilitation Center
  • Kaw River Care & Rehabilitation Center
  • Lansing Care & Rehabilitation Center
  • Neodesha Care & Rehabilitation Center
  • Parkway Care & Rehabilitation Center
  • Pittsburg Care & Rehabilitation Center
  • Spring Hill Care & Rehabilitation Center
  • Wakefield Care & Rehabilitation Center
  • Wellington Care & Rehabilitation Center
  • Wichita Care & Rehabilitation Center
  • Wilson Care & Rehabilitation Center

Dan Margolies is a senior reporter and editor for KCUR. You can reach him on Twitter @DanMargolies.

Dan Margolies has been a reporter for the Kansas City Business Journal, The Kansas City Star, and KCUR Public Radio. He retired as a reporter in December 2022 after a 37-year journalism career.
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