Skyline's implosion continues with Pennsylvania takeover

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Dr. Rachel Levine, Pennsylvania Secretary of Health and Physician General
Dr. Rachel Levine, Pennsylvania Secretary of Health and Physician General

The Pennsylvania Department of Health has installed temporary management at nine nursing homes owned by Skyline Healthcare, the latest group to fall in the growing collapse of the New Jersey-based operator.

Skyline had moved into at least 100 nursing homes across seven states since 2015. But since the end of March, most of those skilled nursing operations have been taken over through receivership or rapid-fire sales.

Pennsylvania officials appointed new operators when it became clear that Skyline  “could no longer fiscally operate the facilities,” which was just a day after South Dakota placed 19 Skyline buildings where residents were at risk of running out of food and medication into receivership.

Skyline, also doing business as Cottonwood, is owned by Joseph Schwartz, a former insurance broker who specialized in long-term care.

Last month, he made headlines when he failed to make payroll at 36 nursing homes in Nebraska and Kansas. Skyline cooperated in the receivership process there.

Skyline spokesman Juda Engelmayer said the company had been communicating with Pennsylvania for the past couple of weeks. Combined, the facilities taken over in that state have 1,053 beds and average 814 residents per day, according to federal data cited by the Philadelphia Inquirer.

“We have installed temporary management at all nine facilities to ensure residents will continue to receive safe care,” Pennsylvania's Secretary of Health, Rachel Levine, M.D., said in a press release. “We are taking this action to ensure residents have continuity of care and their needs are met.”

The department declined to identify who is overseeing the homes or when they took over.

Although Pennsylvania officials did not detail the kinds of financial pressures the state's Skyline facilities were facing as a whole, at least one union said Skyline owed it about $25,000.

The organization representing workers there told LNP Media Group that Skyline paid half half of $49,000 the union said it was owed, but not the remainder due April 20.

In a statement emailed to McKnight's, the company said it has been “working tirelessly for several months to transition from the nursing home and managed care industry. The process of this seamless transition has begun in various regions. As with any transition, there have been hurdles. Although a few obstacles were created by an individual property owner with locations in South Dakota, Kansas, Pennsylvania and Nebraska, Skyline is pleased to report that these issues have been addressed thoroughly and corrected.”

The message seemed to cast blame on Golden Living, which was its landlord in those states.

Golden Living did not immediately respond to a request for comment from McKnight's.

Skyline took over the Pennsylvania homes operated by Golden Living at the beginning of 2017.

According to NewJersey.com, Skyline is also the parent company for nursing homes in Arkansas, Tennessee, Massachusetts and Florida. Schwartz himself also owns three nursing homes with 635 beds and an adult day care center in New Jersey.

The New Jersey Department of Health told the Philadelphia Inquirer “there is no indication that there are any difficulties with the provision of care” at those facilities. A spokeswoman said the department received applications last month for the sale of the facilities to Chaim Scheinbaum, who is the owner of two nursing homes in Andover, NJ.

Pennsylvania also is not getting involved at Skyline's Scranton and Bloomberg locations, which the newspaper reports Schwartz bought from Geisinger Health in February for $21.5 million.

Though some reports yesterday indicated that Skyline would “dissolve,” Engelmayer told McKnight's the company remains in business as it finds more buyers and sells the rest of its nursing home assets over the coming months.

“Ultimately, they are looking to get out of the nursing home industry completely,” he said. “Skyline and its owners, their intent is to make sure that as they divest and transition, that their employees are taken care of and the residents are taken care of.”