$46.8M for SNF/Adult Day Portfolio in New York; Hospital Seeks SNF Buyer Amid Medicaid Cuts

MONTICELLOAM and its affiliates provided a $46.8 million first-lien debt financing to refinance a skilled nursing property and two adult day care facilities with a combined 407 beds in New York.

The deal includes a $3 million working capital loan to the operating company of the properties, which was provided by Monticello Commercial Capital, LLC, Monticello’s asset-based lending group.

The transaction’s sponsor is an owner and operator with a current portfolio of 4,570 licensed beds; Monticello has financed the sponsor’s acquisition of multiple facilities over the past several years, according to a statement announcing the deal.

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Capital Funding and Bank Leumi USA Provide $27.8M Loan for Purchase of Phoenix Center

Capital Funding, LLC and Bank Leumi USA this week announced the closing of a $27.8 million senior secured term loan last year for the purchase of the Phoenix Center for Rehabilitation and Pediatrics, formerly known as the Wanaque Center for Nursing and Rehabilitation.

The 227-bed facility is now operated by Philosophy Care Group, which is owned by Bent BPhilipson and Abraham Kraus.

Capital Funding and Bank Leumi partnered on the joint diligence process and co-funded the term loan, with Capital Funding serving as agent. The transaction was originated by Tim Eberhardt, vice president of real estate finance for Capital Funding, LLC, and Daniel Csillag, group head for healthcare for Bank Leumi USA in the Northeast region.

Philosophy Care officially purchased the facility in early 2020, after it was the center of an outbreak of adenovirus that killed 11 children in 2018. It has focused on making clinical improvements at the facility, with the goal of being as transparent as possible about its history and about its plans for the future, administrator Natasha Islam told Skilled Nursing News.

“We are working on creating a medical advisory board … trying to get other medical advisors like other pediatricians, other doctors, in forming this group to really help me enhance the program that we already have in place for the pediatric unit,” she told SNN in February.

New York Hospital Seeks Buyer to Patch Medicaid Loss

The New York-based Kaleida Health is selling its long-term care center, known as HighPointe, after losing $80 million in Medicaid payments, according to The Buffalo News.

The long-term care space creates “a significant financial, legal and risk burden,” Kaleida CEO Jody Lomeo said in a memo, according to the report.

So far there are no bites for the property, but hospital employees oppose the move, and organized with union CWA Local 1168 to protest the sale — amongst other stated problems with clinical care and services as a result of ongoing labor cuts, including the loss of more than 300 positions since 2019, the Buffalo News reported.

New York is attempting to save $2.5 billion in Medicaid funding for the next year in order to reduce a $6 billion gap in the budget, Lomeo stated. These cuts may result in a 10% decrease in payments for nursing homes, hospitals, managed care services, and other health related services in the state, according to the report.

Lyndee Yamshon contributed to this report.

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