ProMedica is walking away from its skilled nursing venture with Welltower to address operating losses within the nonprofit health organization’s senior care division, the companies announced Monday.
The real estate and management of the skilled nursing facilities under ProMedica and Welltower’s joint venture will transfer beginning Dec. 19, according to a ProMedica news release. ProMedica holds 15% interest in the venture.
The 147 skilled nursing facilities will be sold to Integra Health, which will take on 15% ownership in the venture with Welltower. This deal is expected to close by the end of this year, according to a Welltower news release.
In 2018, ProMedica bought bankrupt post-acute care provider HCR ManorCare for $1.4 billion. Two years later, ProMedica's purchase in the senior living market looked like it was paying off. HCR ManorCare posted a 7.7% operating margin in the first half of 2020. But this March, ProMedica’s senior care unit recorded a $275 million operating loss in 2021, citing reduced patient volumes and labor shortages.
“By engaging in this transaction, we will be able to increase focus and resources on the other areas of our health system as we continue to provide high-quality, compassionate care and invest in our communities and dedicated caregivers,” Arturo Polizzi, president and CEO of ProMedica, said in the news release.
ProMedica will continue operating its 58 private-pay assisted living and memory care communities under its venture with Welltower, the real estate company said.
This announcement comes a week after ProMedica's CEO Randy Oostra retired.
