New owner approved for SD nursing homes in receivership

Jun. 21--The transfer of 16 South Dakota nursing facilities in receivership to a new, permanent owner has been approved, with stipulations.

A court ordered June 11 that Black Hills Receiver be allowed to make the move effective July 1.

The receivership was created in May 2018 to financially stabilize 18 nursing homes and one assisted-living center in South Dakota. Golden LivingCenters, in Texas, which owns the facilities, formed it when the former manager, Skyline Health Care, did not have the money to operate the facilities, was delinquent on rent and couldn't pay other bills, according to court documents.

Receivership is a legal process in which a person or group -- the receiver -- is appointed by a judge to oversee business operations and finances. It's sometimes used when businesses have financial issues.

In documents filed April 19, Black Hills Receiver requested that operation of the remaining facilities it manages be transferred to Cascade Capital Group. Cascade is a private health care real estate investment and management company based out of Illinois. The company oversees more than 135 facilities in 23 states, according to its website.

But before the transfer was approved, the court laid out several conditions for Black Hills Receiver.

First, Black Hills Receiver must maintain a detailed accounting of funds received and expenses paid from before and up until the transfer date, according to the documents. The receivership will be permitted to cover payroll, benefits and paid time off through July 1 without further court approval.

Approximate amounts for all of the outstanding expenses were included in court documents. However, if those are significantly more than what is estimated, Black Hills Receiver will have to submit financial documents and obtain approval, according to the stipulations.

Once those payments are made, $247,275 -- the loan interest Midcap is owed, according to court documents -- will be placed into a separate, interest-bearing account for Midcap. Midcap will have 15 days to prove or dispute the amount.

After Midcap is reimbursed, vendors who are owed for services during the receivership will be paid, according to court documents.

Black Hills Receiver also asked the court June 7 to approve the closing of Covington Care and Rehabilitation Center in Sioux Falls, a facility it managed. According to documents, Cascade, the new owner-operator, was unwilling to take over Covington due to its financial and regulatory history. The court approved this, noting the receivership would be allowed to cover operation and closing costs through Aug. 1. That money will be distributed before Midcap receives its interest.

In November 2018, the state approved the closings of nursing homes in Mobridge and Madison while under the management of Black Hills Receiver.

Of the 16 remaining facilities, nursing homes in the local area are in Groton, Ipswich, Milbank, Redfield and Watertown. There's also an assisted- living center in Milbank.

Follow @eballard_aan on Twitter.

___

(c)2019 the American News (Aberdeen, S.D.)

Visit the American News (Aberdeen, S.D.) at www.aberdeennews.com

Distributed by Tribune Content Agency, LLC.