Nursing Home Giant Good Samaritan Society to Exit 15 States, Focus on Core Markets

The Evangelical Lutheran Good Samaritan Society, one of the largest skilled nursing providers in the United States, plans to consolidate its operations from 22 states to seven.

Once the process is complete, the Sioux Falls, South Dakota-based Good Samaritan Society will have operations in South Dakota, North Dakota, Iowa, Minnesota, Nebraska, Kansas and Colorado.

About 70% of older adults served by the organization reside in those seven states, President and CEO Nate Schema said in an email to employees announcing the consolidation. Good Sam shared the email with Skilled Nursing News on Thursday night.


Good Sam facilities in the additional 15 states currently being served will gradually transition to other operators, according to the email.

Eagle, Idaho-based Cascadia Healthcare is poised to acquire 10 former Good Sam facilities, Cascadia Director of Corporate Affairs and General Counsel Steve LaForte told SNN. Three of the transitioning buildings are in Idaho, three are in Oregon, two are in Washington and one is in Montana.

The tenth building is located in Boise, Idaho. Cascadia previously leased it from Good Samaritan between the fall of 2021 and the summer of 2022, operating the facility as a location for Covid patients during a crisis in hospital access over that time period, LaForte said.


Cascadia is considering how to utilize the building going forward, but the property is included in the deal being worked out with Good Samaritan.

Neither Good Sam nor Cascadia disclosed any financial information related to the transitions.

In 2022, the LeadingAge Ziegler 200 list ranked Good Sam as the second-largest multi-site senior living organization in the United States, with 141 communities — 71 of which were nursing homes. Good Sam merged with health system Sanford in 2019.

“As part of a leading integrated health system, the Good Samaritan Society has an unprecedented opportunity to shape the future of senior care and services, and reimagine how care is delivered at every stage of life,” Schema’s email stated.

This language echoes what he told SNN in his recent 2023 outlook, in which he described several efforts underway to “reimagine how we deliver care.” These efforts include a $350 million virtual care initiative undertaken in conjunction with Sanford.

Schema has spoken about leveraging the “resources and expertise” of Sanford to create innovative health care models for older adults, including more advanced clinical capabilities such as dialysis in SNFs.

Sanford itself is in the process of joining forces with Minneapolis-based nonprofit health system Fairview. The senior housing arm of Fairview, Ebenezer, ranked as the largest nonprofit manager of senior living and care communities on the LeadingAge Ziegler 200 list for 2022, with 100 communities under management.

Earlier dispositions

This is not the first time that Good Sam has had to pivot by divesting of communities or reducing headcount. In 2017, financial pressures led the nonprofit to lay off 100 people at the Sioux Falls national campus. Related to the affiliation with Sanford, the organization divested of 17 locations.

Following the Sanford merger, returning to growth was one leg of a three-part strategic plan, as described by then-President Randy Bury. But this was before the challenges of Covid-19 and the subsequent labor market disruptions.

Like other nursing home providers across the country, Good Sam has had to evaluate its strategy in light of a severe staffing shortage. As of Oct. 2022, the organization had about 2,000 job openings to fill, Schema told SNN at the time.

The staffing crunch was one factor behind the closure of 10 buildings over a 10-month period last year, and Schema was already suggesting that market consolidation was under consideration.

“Where we have a huge hospital presence, where we have a lot of density within our own organization, we have more influence. We’re absolutely looking at where the future lies within the Good Samaritan Society and where we continue to grow our mission,” he said.

Regional model gains more traction

Good Sam’s move to focus on the Midwest and Plains states aligns with a broader trend within the nursing home sector, which has seen large national operators contract into regional players. Examples include Consulate and Brickyard. And 147 facilities formerly operated by health system ProMedica are being transitioned to 15 regional operators, under a new joint venture between Welltower (NYSE: WELL) and Integra Health.

“A consolidated footprint will best enable us to focus resources and investments to continue to strengthen our quality of care and services and meet the comprehensive and evolving needs of our seniors and communities,” Schema said in his email announcing and explaining the strategy.

LaForte is a strong believer in the regional model, which Cascadia has pursued since forming in 2015. He recalled how different the industry was in the early days of his career.

“I’ve been doing this for 24 years … I go back to the time when there were probably 20 public companies they were all big,” he said. “ … We’ve really evolved.”

Cascadia’s current portfolio includes 37 buildings across Arizona, Idaho, Montana, New Mexico, Oregon and Washington. The addition of the former Good Sam buildings will continue the strategy of building up density within Cascadia’s regional framework.

“Given the scale we have in those four states, we can build up the resource support even more to deliver great care and increase access and drive census coming out of the Covid period,” LaForte said.

The deal also will provide a launching pad for the private-pay independent living, assisted living and memory care platform — dubbed Olympus Retirement Living — that Cascadia is building up under the leadership of Tim Nelson. All of the transitioning Good Samaritan properties include skilled nursing, and six of them also have an independent living and assisted living component.

“It’ll create synergies to create a continuum on these campuses,” LaForte said of the deal.

The acquisition is a value-add play, although the various buildings are “in different places” in terms of performance, he said. Still, he emphasized a cultural alignment between Good Sam and Cascadia and an intention to maintain a notable degree of consistency.

“Good Sam is an iconic operator, culturally a leader in the industry, they’ve served these communities for a long time,” he said. “We’re really honored to be able to take over their buildings, perpetuate the employment of their employees — they’ve got great staff — and perpetuate the care, where they set a really nice bar.”

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