The Villa Care Center, 2721 10th Ave. N., and Villa Cottages, 925 Martin Luther King Drive, are among six Iowa nursing facilities owned by Blue Care Homes LLC that have been placed under receivership by the Iowa Department of Inspections and Appeals. The Villa Care Center also does business under the names Webster Post Acute Rehabilitation and QHC Fort Dodge.

According to the DIA, the owner of Blue Care Homes LLC, which is based in New Jersey, notified the DIA that they were “unable and/or unwilling” to continue operations at the six Iowa facilities. Two days later, the DIA filed petitions for receivership of the facilities in District Court, indicating “the facility is unable and has failed to operate and conduct the health care facility in accordance” with Iowa law.

“In light of the current financial condition and operational circumstances at QHC Fort Dodge, the Department finds extraordinary action is necessary to protect the health and safety of the residents,” the petition reads.

The DIA requested the court appoint Kansas City attorney Michael F. Flanagan as receiver to continue to operate the facilities in line with federal and state requirements while residents are relocated and the facilities are closed.

According to an exhibit submitted to supplement the petition, in the late afternoon of Friday, Jan. 20, counsel for Blue Care Homes contacted the DIA “with emergency concerns” about Blue Care’s ability to meet payroll for its facilities in Iowa. The document states that Sam Haikins, an owner of Blue Care Homes, “promptly ceased communication” with the Blue Care legal counsel and the DIA for “over 24 hours.”

“During that time, the Department launched an emergency investigation into the status of operations at the Respondent facility, including the financial management and viability of the facility,” the petition reads.

During a meeting between Haikins and the DIA on Jan. 23, Haikins told the department that the nursing home chain was behind on payroll and didn’t know how that would affect staffing at the facilities.

According to the court filing, the DIA has since learned that Blue Care Homes is also significantly behind on payments to “critical vendors,” “including utility companies that have advised utility shut-offs are imminent.”

On Jan. 26, Flanagan was appointed by the courts to serve as the temporary manager of the six Iowa facilities as they begin to relocate the 263 affected residents and close down operations. According to the DIA, Flanagan has “significant experience in receiverships.”

At this time, nothing has been released by the DIA or Blue Care Homes on what the process of relocation of the residents will look like. Federal and state regulations require facilities to remain open during this transition period — 60 days for nursing and skilled nursing facilities, and 90 days for assisted living facilities.

According to the DIA, the Villa Care Center has 61 current residents and the Villa Cottages has 14.

The Messenger reached out to Villa Care Center Administrator Laci Hoover for comment and was directed by another employee to Stefanie Bond, an attorney at the DIA. A phone call to Bond was not returned by press time on Tuesday.

This is only the second time the DIA has filed for receivership, the department says. The first time was in July 2022 for a facility in Sioux City.

The Villa Care Center and Villa Cottages were part of the QHC Facilities nursing home chain that declared bankruptcy early last year and was sold last fall to Blue Diamond Equities, also known as Blue Care Homes, for $4.5 million, according to Iowa Capital Dispatch.

Other nursing homes and assisted living facilities that are affected include:

Humboldt Wellness and Rehabilitation, aka Humboldt Care Center (45 current residents)

Timber City Wellness and Rehabilitation aka Crestridge Care Center in Maquoketa (58 current residents)

Madison Wellness and Rehabilitation aka Winterset Care Center North (52 current residents)

Madison Square ALP/D in Winterset (33 current residents)