In August, Marcia Doty learned she had 30 days to pack up her belongings and find a new home. The assisted living facility she had been staying at for several months in Kearney was being shut down by its parent company, the Colorado-based Bethesda Foundation, and would be sold to a real estate developer.

“I could hardly believe it,” Doty said. “It was traumatic for me.”

The sudden announcement came as a shock to the 77-year-old Doty and the 40 other older people who called Cambridge Court home. She said some of her friends stopped coming down to meals, and a sense of dread descended upon people who didn’t know where they would go.

“They were depressed,” she said. “It became more quiet, and people didn’t connect. They were in their rooms more than anything.”

Options were already scarce for people who needed assisted living apartments in Kearney. The state has licensed eight facilities with a combined 437 beds for assisted living in Buffalo County. But only around half of those are certified for Medicaid, the government program used by the majority of older people who need long-term care.

And as Medicaid reimbursement rates in Nebraska fail to match the rising costs of healthcare, it has put a squeeze on the facilities that rely on the program to serve its low-income residents. That sometimes forces closures such as Cambridge Court.

“It was an affordable option for families,” said Christina Hansen, a former employee. “We always served the underserved.”

In the wake of her eviction notice, Doty said she was lucky. A nearby facility in Kearney agreed to exceed its usual capacity of Medicaid beds and accept her, along with a few Cambridge Court neighbors.

Others weren’t so fortunate. Some had to move out of town to find a spot that would accept them. Others chose to move back in with family while they wait on space to open locally.

Nursing home and assisted living closures are becoming more common as conditions continue to decline amid tighter margins and acquisitions. After closing its Kearney facility, the Bethesda Foundation announced it would withdraw from Nebraska entirely. It plans to shut down its Omaha assisted living home by Oct. 16, displacing another 50 older people who rely on long-term care.

In a statement, the company said it made the decision to close its Nebraska locations after operating costs rose and they faced other “economic pressures.” In meetings with staff, company executives told them they had been losing money for five years.

“That's the fault of the corporation,” said Hansen, the former employee. “If you have a business that's failing and you let it fail for over five years and didn't visit options to remedy the situation, that's on corporate.”

Sale Was ‘Shocking’

In 2019, Doty was diagnosed with Alzheimer’s disease, an affliction that causes dementia. Right now, it mainly affects her ability to recall certain words, names or dates. For years, she stayed at home with her husband, who acted as her caretaker. But his physical health began to decline, and earlier this year, Doty and her family made the decision to move her into an assisted living facility.

“I just accepted it,” Doty said. “I can get confused too easily.”

Moving away from her longtime home and her husband was daunting at first, she said. When she toured Cambridge Court with her stepdaughter, she knew she had found the right place.

It was the first assisted living facility built in Kearney, opening in 1988 as the Peterson House. It featured a unique open, two-story floorplan with an indoor courtyard lit by expansive skylights where residents could dine together and socialize under 25-foot-tall trees planted indoors. It had 40 apartments and could house up to 50 people. A nearly identical but slightly larger facility also opened in Omaha that same year with 55 apartments, later named Hickory Villa.

The two locations changed ownership a handful of times before ultimately being acquired by the Bethesda Foundation in 1999, which has operated them through its long-term care subsidiary, Bethesda Senior Living Communities.

“When I lived there, it just felt like a homey environment,” Doty said. “And the local people that were in charge were lovely.”

Doty became especially close with Cambridge Court’s manager and Hansen, who served as the manager's administrative assistant. Hansen began working there in June and said she fell in love with Doty and the other residents.

“We fought like family, we loved like family,” Hansen said. 

“It was a dream come true for me.”

But then staff happened to find Cambridge Court listed for sale on an Omaha real estate agent’s website.

“We thought it was a joke,” Hansen said. “We had no idea.”

The manager told staff she didn’t know anything about the sale and that she’d heard nothing from the corporate office in Colorado about it.

Staff say the company’s CEO and chief operating officer visited the Kearney location to address rumors about the sale. They told them it was true, that Cambridge Court had been on the market since at least early June. They said moves like these were typical in the industry, and it would likely be many months before someone showed interest.

Hansen recalled being told that if Cambridge Court were sold, residents and staff alike would get a 60-day notice ahead of any closure.

“They were so nonchalant about it,” Hansen said.

For over a month, staff maintained business as usual. Then Bethesda’s CEO returned on Aug. 11 to deliver surprising news.

“They said we were sold and that we were not going to be an assisted living facility anymore,” Hansen said. “Our residents had 30 days to vacate.”

Doty and her friends learned the news later that night at dinner.

“It was shocking,” Doty said. “I couldn't believe that they were going to sell it, and it took a while to understand that I had to move.”

One longtime employee, Nesha Rose, said she watched as the news took a major toll on the people living at Cambridge Court.

“They were so worried that they were going to end up out on the streets,” Rose said. “It was really hard being there the last week.”

Over 60% of the residents were Medicaid recipients, according to Hansen. Because Medicaid reimbursement rates haven’t kept up with inflation, facilities lose money when they care for those people. By accepting so many Medicaid waivers, Cambridge Court filled a need but began struggling financially.

Bethesda Senior Living Communities Chief Operating Officer Kimberly Erickson declined to be interviewed for this story, instead stating that “rising operating costs combined with other economic pressures” made it “difficult” for the company to keep Cambridge Court open.

“This was not a decision we arrived at lightly, and we understand the uncertainty and emotion that comes with a resident having to leave a place they call home,” Erickson wrote in an email.

Around 25 staff members lost their jobs, and over 40 people were displaced. Later in September, the company cited similar economic concerns and announced it would close its Omaha Hickory Villa location, impacting dozens more. 

The closures come at a time when demand for long-term care is rising as Nebraska’s population rapidly ages. In 2012, people 65 and older made up about 14% of the state’s population. By 2022, that had risen to 22%, according to U.S. Census data. Hansen worries that as long-term care facilities continue to close, they won’t be able to meet the rising demand for beds.

“Where are they going to find those beds?” Hansen asked. “Nobody's building anything new right now.”

Kearney Businessman Intends 

To Flip Properties

In June, Kearney businessman Shawn King learned Cambridge Court was for sale. He already owns several properties in and around Buffalo County through multiple investment companies. In an interview, King said he first learned about the property June 5, and when he expressed interest, he was shown the facility’s finances. 

They were dire.

“I did look at seeing if it could stay operating as an assisted living, and the financials didn't line up with that,” King said. “The facility was going to get shut down one way or another.”

King said he signed a nondisclosure agreement and couldn’t be more specific about the facility’s finances, though he attributed much of its problems to poor Medicaid reimbursement rates. 

Ahead of entering into a purchase agreement July 10, he said it was the Bethesda Foundation that made the ultimate decision to close Cambridge Court, though he was initially told residents would have 60 days to find someplace else to live. That changed in August, when the company told King they would hand over the property in late September, well ahead of schedule.

“They told me that they had places found,” King said. “I agreed to it because they wanted to do it.”

But not everyone found a place to live. Ernestine Dzingle, a Medicaid recipient, couldn’t find room anywhere in Kearney. Instead, she moved in with her daughter and son-in-law while she waits for a bed to open locally.

According to two former staff members, the Bethesda Foundation offered each of the residents $500 to cover moving expenses and told employees they weren’t allowed to help any of them pack up their belongings or move.

Buffalo County records show the property was most recently valued earlier this year at $2.5 million. King purchased Cambridge Court for $1.14 million. He said he plans to turn the building’s 40 rooms into short-term lease studio apartments.

“We'll use it for options for traveling nurses, for doctors, for patients as well as just anybody needing a place that a studio apartment fits for where they're at in life,” King said. “It will have some amenities that you don't see in a lot of multifamily housing.”

King also is planning to buy Hickory Villa in Omaha after it closes this month, with similar plans to offer short-term lease apartments. That sale has yet to close, he said.

An Uncertain Future

Amy Miller is the director of monitoring and systemic advocacy at Disability Rights Nebraska, a nonprofit funded by the federal government that is charged with advocating for people with disabilities. Miller, who has inspected dozens of long-term care facilities in the state, said she’s concerned for the futures of older people who are being forced to make tough decisions about where to live.

She worries about their quality of life. She worries about where they’re going to go next.

“I'm very worried they may be going straight from the frying pan into the fire,” she said.

More long-term care facilities in the state are being bought up by out-of-state investment firms that have little prior experience managing such properties. Miller said they make harsh budget cuts impacting staffing and quality of life for residents and run the properties further into the red until they are forced to close or be sold.

“It's a known playbook,” Miller said. “You buy, squeeze all the profit, and then drop and run, either selling it or declaring bankruptcy.”

In Kearney, Hansen makes time to visit her former residents in their new homes, particularly at Wel-Life, where several moved. She sits and speaks with Doty, who says she’s adjusting but misses the familiarity of Cambridge Court.

“I’ve learned, whatever state I’m in, to be content,” Doty says with a smile.

Hansen tells her she’s still looking for a job, but opportunities in long-term care are scarce right now. Doty tells her not to worry.

“Your hugs are worth money,” she says, and gently squeezes Hansen’s hand.

This story was originally published by Flatwater Free Press, an independent, nonprofit newsroom focused on investigations and feature stories in Nebraska that matter. Read the article at: https://flatwaterfreepress.org/two-nebraska-senior-living-centers-close-sending-almost-100-people-scrambling-for-a-place-to-live/