Report: Troubled Former Golden Living Facilities Highlight Oversight Issues

November 18, 2018, Maggie Flynn, Skilled Nurisng News - Nursing facilities formerly operated by Golden Living in Pennsylvania are still plagued with problems — even as Golden Living continues to own the real estate.  That’s according to an in-depth investigation published last week by PennLive, which explored the issues of nursing facilities that the Plano, Texas-based Golden Living used to operate in the state.

As the result of a 2015 lawsuit, Golden Living transferred its 36 nursing home licenses to other chains, but many of those facilities are still offering poor care, according to the report.  A review of property records by PennLive found Golden Living still owns the real estate of all 36 homes it used to manage in Pennsylvania. An analysis of Medicaid cost reports for 20 of its homes led PennLive to estimate that Golden Living received at least $12 million in rent in 2017 from the operators now running its Pennsylvania properties.

The investigation also found that in 2016, at least 465 of Pennsylvania’s roughly 700 nursing homes conducted “related party transactions,” wherein a chain — including Golden Living — sets up subsidiaries that provide physical therapy or pharmaceuticals to its homes.

PennLive found that while cost reports indicated the company appeared to lose about $12 million in 2016, it paid $46 million to Golden Living subsidiaries for staffing, food, and other services.  The new operators of Golden Living’s homes have similarly spent millions on services supplied by subsidiaries, according to PennLive — including Priority and CHMS Group, which also bought Golden Living licenses.

Seven former Golden Living homes were operated by the Wood Ridge, N.J.-based Skyline Healthcare and had to be taken over by the state of Pennsylvania after the operator ran out of the money to run the facilities.  The collapse of Skyline was particularly concerning to advocates, who told PennLive the company’s collapse indicates how poorly states are checking nursing home companies’ financial stability and quality.

Juda Englemayer, a spokesman for Skyline Healthcare, told the publication that Golden Living’s leases were to blame in Skyline’s struggles.  Golden Living also required Skyline to buy certain amounts of goods and services from its subsidiaries, according to Englemayer.

The troubled Skyline chain emerged from seemingly nowhere to control properties across the country before falling apart earlier this year, leaving multiple unpaid vendors, employees, and state agencies in its wake.  Just last week, a receiver in charge of 19 former Skyline SNFs in South Dakota moved to close two properties in the state amid cash-flow issues at the sites.

The PennLive report also focused on issues with facilities owned by Priority Healthcare Group, a New York chain that was founded in 2015 by David Gamzeh and Akiva Glatzer.  Priority purchased the licenses of 11 Golden Living homes in February 2017; Golden Living continued to own the real estate, as it did with the other three chains that purchased its licenses, according to PennLive.

“Golden Living’s ownership interest is largely invisible to an outside observer,” the publication reported.  “Like the other buyers of Golden Living’s licenses, Priority shed Golden Living’s signs and rebranded its homes.”

Elder care researchers and advocates said the issues uncovered by PennLive reflect oversight failures by the state of Pennsylvania.  It’s not clear whether the Pennsylvania Health Department vetted any of the chains that took over Golden Living’s homes before granting them licenses, according to PennLive.

Golden Living declined to answer questions submitted over several months for the PennLive story; a request for comment from Skilled Nursing News was not immediately returned.

Pennsylvania Auditor General Eugene DePasquale said he will conduct a new audit of the state health department’s oversight of nursing homes on the same day the investigation was published, PennLive reported.  The audit comes two years after a similar audit was conducted by DePasquale that contained 13 findings and 23 recommendations.