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Massachusetts health officials have denied Sweetwater Care’s application to buy 11 nursing homes owned by the troubled Next Step Healthcare chain.
Sweetwater’s track record of providing poor care in other states was the reason officials denied the application, a spokesperson for the Department of Public Health said on Tuesday. The California-based chain has been cited repeatedly for hurting residents at its nursing homes in other states, and it recently settled a lawsuit brought by California prosecutors who accused the chain of keeping staffing at dangerously low levels.
This is the first time Massachusetts health officials have said they denied an application to buy a nursing home since a recent Boston Globe Spotlight investigation, which found the state allowed out-of-state buyers with problematic track records to scoop up Massachusetts nursing homes and slash the quality of care.
Before The Globe’s investigation was published last month, The Light had reported on Sweetwater’s history of poor care and understaffing.
Public Health Commissioner Robbie Goldstein said on Wednesday that his agency was trying to do a better job at holding the nursing home industry accountable.
“Owning a nursing home is an extraordinary responsibility and a privilege,” Goldstein said in a written statement. “The health, safety, dignity, and well-being of residents must always come first.”
Read the commissioner’s full statement
“The decision to deny Sweetwater’s application to acquire ownership of 11 nursing homes in Massachusetts reflects our obligation to hold those seeking to own and operate long-term care facilities in the state to the highest standards of quality and care. Owning a nursing home is an extraordinary responsibility and a privilege. The health, safety, dignity, and well-being of residents must always come first. The Department is strengthening its oversight of the long-term care industry, identifying problems earlier, and holding operators accountable for providing the high-quality care and services that residents and their families deserve.”
– Massachusetts Department of Public Health Commissioner Robbie Goldstein, MD, PhD
In recent weeks, the agency has also moved to revoke the license of a nursing home operator at the center of The Globe’s investigation, updated staffing incentives, and promulgated long-pending regulations designed to improve oversight of long-term care.
Paul Lanzikos, co-founder of the elder advocacy group Massachusetts Dignity Alliance, said the agency made the right decision in denying Sweetwater.
“I’m taking this as an indication the Department of Public Health is stepping up and applying their authority more vigorously and appropriately,” he said.
A Middlesex judge appointed a receiver to temporarily control the 11 Next Step nursing homes earlier this year, after Next Step’s landlord filed a lawsuit alleging the chain owed millions of dollars in rent. The 11 nursing homes include facilities in Plymouth, Taunton, Middleborough, and Attleboro.
Next Step also owns Fall River Healthcare, which was once on a list for the country’s “worst of the worst” nursing homes, and another facility near Pittsfield. But those facilities have a different landlord and aren’t part of the receivership or Sweetwater deal.
The receiver for the 11 Next Step nursing homes appointed Sweetwater as a temporary manager to run day-to-day operations at the facilities in July. Sweetwater filed paperwork asking state health officials for permission to take permanent ownership in August.
The Department of Public Health denied the application on Tuesday, finding that Sweetwater would not be a “suitable” operator.
A spokesperson for the agency said its decision was based in part on health inspections showing Sweetwater had put residents in “immediate jeopardy” at least a dozen times in the last three years, low Medicare ratings, and the $15 million understaffing settlement Sweetwater reached with California prosecutors in July.
Massachusetts would be a new market for the company. Last month, The Light identified at least 28 nursing homes owned by Sweetwater and its affiliates in California, Colorado, Montana, and Kansas. Dignity Alliance advocates said this month as many as 51 nursing homes in seven states are part of the group’s expanding portfolio.
As Sweetwater’s application was pending, the elder advocates raised alarm about the chain’s health inspections and noted that its settlement had uncanny similarities to a settlement Next Step reached with Massachusetts prosecutors in 2024. They voiced concerns about Sweetwater’s ability to make necessary improvements at already-underperforming Next Step facilities.
Sweetwater has the right to appeal the agency’s decision at the Division of Administrative Law Appeals, a separate state agency.
The Light reached out to the receiver, Sweetwater, Next Step, and the chain’s landlord Cuarzo Healthcare on Wednesday morning but did not immediately hear back.
With this deal blocked at least for now, it’s not clear what the future holds for Next Step. Sweetwater still appears to be the temporary operator of the facilities as the receivership case moves forward.
A spokesperson for the Department of Public Health did not immediately have an answer to The Light’s questions on Wednesday about whether officials were conducting any enhanced oversight of the facilities under Sweetwater’s control and whether there was another buyer lined up.
Lanzikos, the Dignity Alliance co-founder, said he and other elder advocates were concerned about Sweetwater’s continued management at the 11 facilities with the path to new ownership now uncertain.
“But I’m going to take some comfort in the fact that I do believe the Department of Public Health is much more vigilant in their oversight right now,” he added. “I anticipate the department is going to watch them very closely.”
Email Grace Ferguson at gferguson@newbedfordlight.org
