More than 50 Iowa nursing homes owe the state nearly $14 million in unpaid fees. (Photo via Getty Images)
More than 50 privately owned Iowa nursing homes have agreed to reimburse taxpayers for $13.9 million in unpaid fees owed to the state.
In August, Iowa Capital Dispatch reported that records obtained though the state’s Open Records Act showed that 49 Iowa nursing homes owed the state more than $10.7 million in fees the state had so far failed to collect.
At the time, the Iowa Department of Health and Human Services said it had entered into payment plans with many of the care facilities.
In response to the Capital Dispatch’s subsequent request for the amortization schedules that detail the schedule of payments for individual homes, DHHS recently turned over records pertaining to 52 care facilities, indicating a few facilities that hadn’t agreed to payment plans in August have since been added to the list.
The newly disclosed documents show that:
— The payment plans total $13.9 million: The 52 nursing homes are in the midst of reimbursing the state for $13,914,672 in unpaid fees, with many of the monthly payments having been initiated in April of this year. Most of the agreements call for the companies to have their debt paid off by September 2025.
— Two homes owed $1.3 million each: Two of the nursing homes that accrued a large amount of debt are owned by one for-profit company called Pacifica Health Services. That company operates the Carlisle Center for Wellness and Rehabilitation, which has agreed pay the state $1,357,454, and the Fleur Heights Center for Wellness and Rehabilitation in Des Moines, which has agreed to pay the state $1,351,653.
— One chain owed $4 million: The nursing home chain that accrued the largest debt is Accura Healthcare, which operates 19 care facilities in Iowa that are now on payment plans totaling $4,073,725. Since 2018, Accura CEO Ted LeNeave has donated $47,000 to Gov. Kim Reynolds’ campaign coffers and $61,000 to the campaign committees of Senate Majority Leader Jack Whitver, an Ankeny Republican. The chain has been hit with more than $1.1 million in fines for quality-of-care violations, and regulators have suspended Medicaid payments to various Accura facilities at least 11 times.
In a written statement, the company said Friday that it is “fully committed to fulfilling its repayment obligations.” The company added that its facilities that owe the most — a few Accura-owned homes owed taxpayers more than half a million dollars each when the payment plans were executed — are those with a higher number of residents and a higher per-bed fee imposed by the state.
When the company began to experience difficulty in making payments at the end of 2022, the company said, it was “proactive and transparent” and reached out to the State of Iowa to make them aware of the debt and to establish a payment plan.
“Accura HealthCare is immensely grateful for the guidance and assistance provided by the State of Iowa throughout this process,” the company said.
— Some homes charged interest: DHHS is characterizing some of the financial arrangements with nursing homes as the repayment of “loans,” rather than the collection of unpaid fees. In some cases, the documents show, the state is charging the facilities interest, but in other cases the payment plans speak only to the amount of principal that will be paid, with no mention of interest.
— Debtors include closed facilities: Two now-shuttered care facilities — the Donnellson Health Care Center and Fremont County’s Tabor Manor – owe the state close to $1.3 million. The state appears to have no payment plan in place for Tabor Manor, which is currently in bankruptcy and owes the state roughly $1.1 million, but it does have a payment plan that calls for the Donnellson home to make an escalating series of payments through September 2025 to pay $282,265 it owes the state.
— Million-dollar balloon payments: Many of the facilities that owe the state hundreds of thousands of dollars will pay a relatively small amount toward their debt until 2025, when balloon payments of $400,000 or more will come due. For example, the Carlisle and Fleur Heights homes are expected to each make monthly payments of $10,000 until May 2025, at which point they’ll each be required to pay $1.1 million.
Fee arrangement is supposed to increase worker pay
The unpaid fees, called Quality Assurance Assessment fees, are a mechanism that has been used since 2009 to artificially inflate nursing homes’ cost of doing business. When the fees are paid, it increases the cost of doing business for the homes. That increased expense enables the facilities to draw down more federal money in Medicaid reimbursement for resident care.
Often, the increased Medicaid payments more than offset the cost of the fees paid to the state, resulting in a net gain for the homes. By law, the care facilities are supposed to use that additional money to increase the pay of their front-line caregivers — which is why the fees are called Quality Assurance Assessment fees.
It’s a circular, but legal, method of increasing the revenue collected by nursing homes and has been approved by the federal government in Iowa and other states.
Maureen Barton of DHHS said in August that the department has been “working diligently” to ensure the nursing home adhere to their payment plans and that when a facility falls behind in payments, the state sends then “a demand notice” asking the facility to pay the entire amount that’s due.
If that doesn’t happen, she said, DHHS can reduce the amount of Medicaid money flowing to the homes in an effort to offset the debt.
The department also has the ability to impose sanctions, she said, and can refer the matter to the Iowa Department of Revenue for collection.
In 2021, the Iowa-based QHC Facilities nursing home chain filed for bankruptcy and informed the court that it owed taxpayers more than $3.9 million in unpaid QAA fees that had accrued over a period of several years.
At the time of its bankruptcy, QHC Facilities also owed the state and federal government at least $2.2 million for unpaid fines and advance payments collected for resident care.
Care facilities on payment plans
The Iowa nursing homes now on payment plans for failing to reimburse the state for expenses tied to the Quality Assurance Assessment program include:
The Ivy at Davenport: This facility agreed to make a series of monthly payments, beginning in April 2024, to repay $516,986 that is owed, at an annual interest rate of 6.25%, with monthly payments averaging $44,323. With the $14,890 in interest payments factored in, the home will pay the state a total of $531,877.
Aspire of Donnellson: This facility is now closed. Before closing, it had agreed to make an escalating series of payments to the state over 18 months in order to repay $282,265 that it owes. The home is owned or operated by Beacon Health Management of Florida.
Aspire of Estherville: This facility agreed to make an escalating series of 18 monthly payments, beginning in April 2024, to repay $336,846 that is owed. This home is owned or operated by Beacon Health Management of Florida.
Aspire of Lake Park: This facility agreed to make a series of 18 monthly payments, beginning in April 2024, to repay the state $55,681. This home is owned or operated by Beacon Health Management of Florida.
Aspire of Muscatine: This facility agreed to make an escalating series of 18 monthly payments, beginning in April 2024, to repay $622,104 that is owed. This home is owned or operated by Beacon Health Management of Florida.
Aspire of Perry: This facility agreed to make a series of 18 monthly payments, beginning in April 2024, to repay the state $67,133 that is owed. This home is owned or operated by Beacon Health Management of Florida.
Aspire of Pleasant Valley: This facility agreed to make an escalating series of 18 monthly payments, beginning in April 2024, to repay $364,161 that is owed. This home is owned or operated by Beacon Health Management of Florida.
Aspire of Primghar: This facility agreed to make a series of 18 monthly payments, beginning in April 2024, to repay $51,008 that is owed. This home is owned or operated by Beacon Health Management of Florida.
Aspire of Sutherland: This facility agreed to make a series of 18 monthly payments, beginning in April 2024, to repay $40,202 that is owed. This home is owned or operated by Beacon Health Management of Florida.
Aspire of Washington: This facility agreed to make an escalating series of 18 monthly payments, beginning in April 2024, to repay $580,175 that is owed. This home is owned or operated by Beacon Health Management of Florida.
Accura Healthcare of Ames: This facility agreed to make an escalating series of 18 monthly payments, beginning in April 2024, to repay $513,438 that is owed. The plan calls for balloon payment of $459,438 in September 2025.
Accura Healthcare of Aurelia: This facility agreed to make a series of 18 monthly payments, beginning in April 2024, to repay $48,997 that is owed.
Accura Healthcare of Bancroft: This facility agreed to make a series of 18 monthly payments, beginning in April 2024, to repay $27,724 that is owed.
Accura Healthcare of Carroll: This facility agreed to make an escalating series of 18 monthly payments, beginning in April 2024, to repay $345,222 that is owed. The plan includes a balloon payment of $309,222 to be made in September 2025.
Accura Healthcare of Cascade: This facility agreed to make a series of 18 monthly payments, beginning in April 2024, to repay $54,898 that is owed.
Accura Healthcare of Cherokee: This facility agreed to make an escalating series of 18 monthly payments, beginning in April 2024, to repay the state $217,510. The plan includes a balloon payment of $190,510 to be made in September 2025.
Accura Healthcare of Cresco: This facility agreed to make a series of 18 monthly payments, beginning in April 2024, to repay $15,689 that is owed.
Accura Healthcare of Knoxville: This facility agreed to make an escalating series of 18 monthly payments, beginning in April 2024, to repay $431,499 that is owed. The plan includes a balloon payment of $386,499 to be made in September 2025.
Accura Healthcare of LeMars: This facility agreed to make a series of 18 monthly payments, beginning in April 2024, to repay $45,385 that is owed.
Accura Healthcare of Marshalltown: This facility agreed to make an escalating series of 18 monthly payments, beginning in April 2024, to repay $442,879 that is owed. The plan includes a balloon payment of $397,879 to be made in September 2025.
Accura Healthcare of Milford: This facility agreed to make an escalating series of 18 monthly payments, beginning in April 2024, to repay $217,111 that is owed. The plan includes a balloon payment of $190,111 to be made in September 2025.
Accura Healthcare of Newton East: This facility agreed to make an escalating series of 18 monthly payments, beginning in April 2024, to repay $459,119 that is owed. The plan includes a balloon payment of $405,119 to be made in September 2025.
Accura Healthcare of Ogden: This facility has agreed to make a series of 18 monthly payments, beginning in April 2024, to repay $26,601 that is owed.
Accura Healthcare of Pleasantville: This facility has agreed to make an escalating series of 18 monthly payments, beginning in April 2024, to repay $393,951. The plan includes a balloon payment of $348,951 to be made in September 2025.
Accura Healthcare of Pomeroy: This facility has agreed to make a series of 18 monthly payments, beginning in April 2024, to repay $36,986 that is owed.
Accura Healthcare of Shenandoah: In April 2024, this facility agreed to repay the state $62,274 by making 18 monthly payments of $3,460.
Accura Healthcare of Spirit Lake: This facility has agreed to make an escalating series of 18 monthly payments, beginning in April 2024, to repay $406,555 that is owed. The plan includes a balloon payment of $361,555 to be made in September 2025.
Accura Healthcare of Stanton: This facility has agreed to make a series of 18 monthly payments, beginning in April 2024, to repay $31,478 that is owed.
Traditions Memory Care of Newton: This Accura Healthcare facility has agreed to make an escalating series of 18 monthly payments, beginning in April 2024, to repay $296,409 that is owed. The plan includes a balloon payment of $260,409 to be made in September 2025.
Northbrook Healthcare and Rehabilitation, Cedar Rapids: This home agreed to repay the state $460,186, plus interest, by making 12 monthly payments of $39,454, beginning in September 2024. The total amount to be paid, including interest, is $473,448.
Carlisle Center for Wellness and Rehabilitation: This home agreed to repay the state $1,357,454 by making 17 monthly payments of $10,000, beginning in January 2024, and then making one balloon payment of $1,187,454 in May 2025. This home is owned or operated by Pacifica Health Services.
Fleur Heights Center for Wellness and Rehabilitation, Des Moines: This home agreed to repay the state $1,351,653 by making 17 monthly payments of $10,000, beginning in January 2024, and then making one balloon payment of $1,181,653 in May 2025. This home is owned or operated by Pacifica Health Services.
Pine Acres Rehab and Care Center, West Des Moines: This home agreed to repay the state $279,559, plus interest, by making 12 monthly payments of roughly $23,968, beginning in May 2024. The total amount to be paid, including interest, is $287,259.
Prestige Care Center, Fairfield: This home agreed to repay the state $461,465, plus interest, by making 12 monthly payments of roughly $39,564, beginning in September 2024. The total amount to be paid, including interest, is $464,763.
Rose Haven Nursing Home, Marengo: This home agreed to repay the state $242,114 by making 12 monthly payments of roughly $20,176, beginning in July 2024.
Silver Oak Nursing and Rehabilitation, Marion: This home agreed to repay the state $324,487, plus interest, by making 12 monthly payments of roughly $27,820 beginning in April 2024. The total amount to be paid, including interest, is $333,792.
Casa De Paz Health Center, Sioux City: This home agreed to repay the state $307,710 by making 12 monthly payments of roughly $25,643 each, beginning in April 2024. This facility is owned or operated by Trillium Healthcare Group.
Cedar Falls Health Care Center: This home agreed to repay the state $220,418 by making 12 monthly payments of roughly $18,368 each. beginning in April 2024. This facility is owned or operated by Trillium Healthcare Group.
Crest Haven Care Center, Creston: This home agreed to repay the state $24,660 by making 12 monthly payments of roughly $2,055 each, beginning in April 2024. This facility is owned or operated by Trillium Healthcare Group.
Denison Care Center: This home agreed to repay the state $30,480 by making 12 monthly payments of roughly $2,540 each, beginning in April 2024. This facility is owned or operated by Trillium Healthcare Group.
Elmwood Care Center: This home agreed to repay the state $238,385 by making 12 monthly payments of roughly $19,865 each, beginning in April 2024. This facility is owned or operated by Trillium Healthcare Group.
Garden View Care Center, Shenandoah: This home agreed to repay the state $231,639 by making 12 monthly payments of roughly $19,303 each, beginning in April 2024. This facility is owned or operated by Trillium Healthcare Group.
Grandview Healthcare Center, Oelwein: This home agreed to repay the state $32,153 by making 12 monthly payments of roughly $2,679 each, beginning in April 2024. This facility is owned or operated by Trillium Healthcare Group.
Grundy Care Center, Grundy Center: This home agreed to repay the state $34,015 by making 12 monthly payments of roughly $2,835 each, beginning in April 2024. This facility is owned or operated by Trillium Healthcare Group.
Iowa City Rehab & Healthcare Center: This home agreed to repay the state $267,064 by making 12 monthly payments of roughly $22,255 each, beginning in April 2024. This facility is owned or operated by Trillium Healthcare Group.
Lenox Care Center: This home agreed to repay the state $30,754 by making 12 monthly payments of roughly $1,729 each, beginning in April 2024. This facility is owned or operated by Trillium Healthcare Group.
Linn Haven Rehab & Healthcare Center, New Hampton: This home agreed to repay the state $243,775 by making 12 monthly payments of roughly $20,315 each, beginning in April 2024. This facility is owned or operated by Trillium Healthcare Group.
Osage Rehab & Healthcare Center: This home agreed to repay the state $34,529 by making 12 monthly payments of roughly $2,878 each, beginning in April 2024. This facility is owned or operated by Trillium Healthcare Group.
Pleasant Acres Care Center, Hull: This home has agreed to repay the state $141,668 by making 12 monthly payments of roughly $11,806 each, beginning in April 2024. This facility is owned or operated by Trillium Healthcare Group.
Premier Estates, Muscatine: This home agreed to repay the state $289,268 by making 12 monthly payments of roughly $24,106 each, beginning in April 2024. This facility is owned or operated by Trillium Healthcare Group.
Premier Estates, Toledo: This home agreed to repay the state $254,318 by making 12 monthly payments of roughly $21,193 each, beginning in April 2024. This facility is owned or operated by Trillium Healthcare Group.
Sunny Knoll Care Center, Rockwell City: This home agreed to repay the state $18,176 by making 12 monthly payments of roughly $1,515 each, beginning in April 2024. This facility is owned or operated by Trillium Healthcare Group.