Western Pa. nursing home group defaults on $30M loan; workers unpaid, patient safety concerns voiced

An outside administrator will operate Western Pennsylvania nursing homes owned by Bonamour Health Group LLC, according to documents filed in federal court in Pittsburgh.

The company owns six nursing homes, including ones in East Huntingdon, Jefferson Hills, Beaver County’s Hopewell Township and Clearfield, Jefferson and McKean counties.

Bonamour defaulted on its mortgage in December and caused a “serious risk” that left workers unpaid and endangered patient safety, according to court papers.

Michael Flanagan, a Downingtown-based health care expert, was appointed to administer the facilities’ financial records and has the power to retain, hire and fire employees, according to federal Judge Kim R. Gibson’s order Thursday.

Residents of Jefferson Hills Healthcare and Rehabilitation Center on Clairton Road were moved to unidentified “neighboring facilities” on the morning of March 2, according to a March 5 letter Bonamour CEO Shaya Zidele sent to the state Department of Health.

Zidele could not be reached for comment Friday.

The state Health Department said it is working with the new operating company, Everest Management Solutions LLC of New York City, to ensure residents’ health and safety, said Mark O’Neill, a department spokesman. Bonamour did not object to the appointment of the receiver that hired Everest Management, according to court documents.

The lawsuit that Revere Tactical Opportunities of Dallas filed against the Jefferson Hills, East Huntingdon, Beaver, Ridgeview, Lakeview and Mulberry health care and rehabilitation centers, and the entities that own the properties, claimed a receiver is necessary to prevent a closure. The suit alleged Bonamour did not have the money to continue operating the facilities and the state Department of Health would shutter the nursing homes because of continuing violations.

The lawsuit was triggered by Bonamour Health Group and four owners in New York and New Jersey defaulting on the $30.59 million mortgage. The ownership group received the loan in June 2022 and failed to make payments since December, according to lawsuit.

The Health Department issued five statements of deficiencies against three of the nursing homes, including one against the Scottdale Healthcare and Rehabilitation Center in East Huntingdon.

Courtney Boord, nursing home administrator for the 35-bed East Huntingdon location, could not be reached for comment Friday.

Revere Tactical urged the judge to appoint a receiver because the company’s financial problems were impacting workers. The lawsuit claimed the problems in paying employees has resulted in understaffing.

The lawsuit cited news stories about workers at the Jefferson Hills facility recently walking off their jobs because they did not receive their pay or it was delayed. Ridgeview nursing home workers complained of delayed paychecks and unpaid bills, according to another news story.

Vendors have sued over the company’s failure to pay bills. A Florida-based nursing staffing agency, GLC on the Go Inc., sued Bonamour last year for just under $190,000 in unpaid bills. Bonamour and the staffing agency reached an out-of-court settlement, according to a Feb. 20 filing.

Revere claimed in its complaint there has been a decline in occupancy at the nursing homes.

If Bonamour continued to operate the sites, Revere claimed its “collateral will become meaningless, and the facilities’ residents will be at risk of receiving subpar care until they are forced to find another facility.”

If any of the properties are sold while Flanagan is the receiver, he would receive a 1% sale disposition fee, according to the court order.