The Centers for Medicaid & Medicare Services was trying to stop the pending sale of a bankrupt nursing home chain in Iowa before CMS and the buyers resolved the issues.

The agency said the chain owes it $1 million, and the sale of five facilities would wind up denying CMS — and therefore also taxpayers — reception of the full amount, according to a local report. The amount paid would only be between $509,000 and $740,000 because of the chain’s eight facilities at the time of bankruptcy, three are excluded from the transaction after closing in the past year.

CMS had asked the bankruptcy court to reject the proposed transfer of Medicare provider agreements for three QHC care facilities to the proposed buyer, Blue Diamond Equities, according to reports.

Wednesday, Sam Haikins, managing partner of Blue Diamond Equities, told McKnight’s Long Term Care News the sale will go through later this month.

“The pending motion to sell free and clear, including assumption of executory contracts with the United States Department of Health and Human Services (which includes CMS) will be conducted on October 28, 2022. We are working with our counterparts at the government to resolve all outstanding issues between the parties,” Haikins said in the statement. 

“We look forward to closing on the sale transaction and having the bankruptcy court approve of any compromise by the parties at the hearing,” Haikins added, clarifying that the statement means “that all parties are working together to get everything resolved.”

State records show QHC owes the Iowa Department of Health and Human Services more than $3.9 million in unpaid fees. The company, owned by a couple of former employees of Quality Health Care Specialists, which bought it in 2011, has more than 300 creditors seeking payment. QHC asked that its debt to the state be treated as a “lower priority,” and the state has not filed any written objections to the sale.

That debt was closer to $2 million before the three closures. One of the facilities, for example, owed CMS $385,000 and it’s unclear whether that debt has been paid.McKnight’s Long-Term CareNews reached out to QHC Tuesday but did not get a response by deadline.