COLONIAL HEIGHTS, Va. — A temporary sign now covers what used to say 'Colonial Heights Rehabilitation and Nursing Center,' indicating a new name for the nursing home and new management too.
The facility underwent an ownership change a year and a half after the arrests of more than a dozen of its staff members drew scrutiny from lawmakers, regulators, and the public.
However, some questions about the new ownership remain unanswered, even after state lawmakers passed new measures requiring greater transparency in nursing home ownership structures.
New operators pledge improvements
Prestige Healthcare has identified itself as the new operator of Colonial Heights, which now goes by the name Magnolia Post Acute.
The company's vice president of operations Aileen Mulvey said Prestige acquired the operation of this nursing home and three others from the group Medical Facilities of America (MFA).
"Does Prestige have any connections to MFA at all, or any related party ties?" reporter Tyler Layne asked Mulvey in an interview.
"No, no. We're a completely separate organization with no relationship to the former owners," Mulvey said.
Mulvey said she's aware the transition comes on the heels of controversy.
At Colonial Heights, the arrests of 18 employees in December 2024 sparked a special grand jury investigation into allegations of abuse and neglect. Most of the initial charges in the case were dropped as the special grand jury investigation began. Prosecutors have not yet disclosed the results of that probe.
Prestige has also taken over control of Wonder City, Westport, and Henrico Health and Rehab from MFA.
Henrico has been identified by regulators as the state's worst-performing nursing home due to its history of serious quality issues. The other two facilities have been given "much below average" one-star overall ratings from the Centers for Medicare and Medicaid Services (CMS).
"We acknowledge what happened in the past. I think here, especially at Colonial Heights, you've done a lot of investigative reporting, and I think that speaks for itself. And I think we were really excited to come in here and make a difference in the lives of the patients that are entrusted to all of these facilities," Mulvey said.
Mulvey said the acquisition of a fifth low-rated facility, Parham Healthcare and Rehabilitation Center, has not yet gone through.
According to CMS, Prestige has an average overall chain performance of 3.2-out-of-5-stars, which is slightly above the national average of 3.0. The score reflects the chain's outcomes in three categories: health inspections, staffing, and quality measures.
Prestige is headquartered in Howell, New Jersey, and the company has operated fifteen for-profit nursing homes in Pennsylvania, Delaware, and D.C.
Those three places all have minimum staffing requiresments. Virginia does not.
Under prior management, Colonial Heights, Westport, and Henrico were cited by the Virginia Department of Health for having insufficient staffing. Some employees expressed concerns about not having enough help to provide adequate care, according to inspection reports.
Mulvey did not commit to raising the facilities' staffing levels but said assessing staff quality and performance would be a priority.
"Will Prestige increase the staffing levels at these nursing homes?" Layne asked.
"We always look at staffing when we come in, and not just the amount of staff, but the quality of staff. We really believe that investing in our employees is what's going to provide better care to patients, right? People want to be happy when they come to work because they spend a lot of time here, and we know that if we can make our employees happy and they're happy to be here, they provide better care," she answered.
"Is there a particular minimum of hours per resident per day that you guys would like to target?" Layne asked.
"I don't think that we have a number specifically in our head. I think we really look at the type of patients that we're providing care to. One building may need more than another building," Mulvey said.
When asked how exactly Prestige will improve quality, Mulvey said the first step is to collect feedback from the communities before establishing a "definitive plan."
"Do you have any ideas yet about what that definitive plan will look like, what specific actions may need to be taken to meet those goals?" Layne asked.
"I think obviously quality care, compliance, transparency are always things that we put at the top of our list to go over. There's obviously also some capital improvements that are going to start very quickly in the buildings as well," Mulvey said.
She said some reforms have already taken effect, such as a switch in food and housekeeping vendors.
Some ownership details unclear, 'should not be a mystery'
But some elements related to the acquisition remain unclear.
In a statement, the Virginia Department of Health, which licenses nursing homes, said the buyer of the four facilities "was not Prestige but 'Dominion SNF Holdco I LLC' received under a YAD Healthcare email address."
However, YAD Healthcare, a different nursing home chain based in Lakewood, New Jersey, told CBS 6 it had "no involvement" in this sale or any of the facilities.
CBS 6 could not locate state business registration records for Dominion SNF Holdco I LLC. A spokesperson for the State Corporation Commission, the agency that registers businesses in Virginia, said he did not see any records for that name in SCC files.
CBS 6 followed up with Prestige to seek further clarification.
A company spokesperson said Prestige is the "chain affiliation" and "turnaround leader" for the acquired facilities. He said each facility is "legally run by its licensed administrator."
CBS 6 has also had difficulty confirming who owns the property for the nursing homes. Under prior ownership, the nursing home's real estate and operations were separated into two different companies.
"Do you know who still owns the property companies for the facilities?" Layne asked Mulvey.
"Specific names of those owners, no, I don't know. But I can tell you that that has nothing to do or any affiliation with the former owners," Mulvey said.
Local real estate records still list ownership as the same entities involved in the previous acquisition of the nursing homes in 2020 and 2021 and were affiliated with MFA.
CBS 6 asked MFA whether it sold those entities and to whom, but we have not heard back.
A Prestige spokesperson said those property records are now outdated. However, he did not confirm who Prestige is leasing the facilities from.
Prestige said it is only involved in operations, not the real estate.
"At the end of the day, this should not be a mystery. This should be known science to every family," Del. Rodney Willett (D-Henrico) said about the confusion surrounding the ownership details.
This year, the state legislature passed a bill by Del. Willett to require nursing home ownership information during an operator change. The law requires the disclosure of the "owner of the building or buildings in which the nursing home is housed if such owner is not the entering operator."
Willett said he proposed the bill to bring transparency to families due to "constant churn and changeover" in what he said was a limited number of facilities.
The law took effect on July 1. The date of this sale was June 30.
A VDH spokesperson said the sales of these nursing homes were not subject to the new transparency requirements and the agency will have to develop regulations before the rules can be enforced.
"Do you feel like they should just voluntarily disclose that, even if the law doesn't require it right now?" Layne asked Willett.
"I certainly would agree with that, and again, I keep emphasizing the fact it's the exception here that we're having to deal with. Most nursing homes are very forthcoming," Willett said. "I think what you've identified is a potential issue that still may exist in terms of getting that information."
As CBS 6 previously reported, under previous ownership, the nursing home operating companies paid rent to a related-party real estate company. At Colonial Heights, the price of that rent increased significantly from $2.6 million in 2022 to $6.1 million in 2024, according to cost reports filed with the state's Medicaid agency.
When asked whether rent would continue to escalate under new ownership arrangements, Mulvey said that was not something she could speak to.
Federal agency 'issues' delay sale of fifth facility
The sale of a fifth facility, Parham Healthcare and Rehab, is still pending, according to Mulvey.
VDH said it received information from a "legal representative handling the sale" that the acquisition would take additional time to close because it is a "HUD building."
According to the U.S. Department of Housing and Urban Development, HUD guaranteed a $39 million mortgage on Parham in 2025 through a federal program that provides mortgage insurance for residential care facilities. The program can be used to "finance the purchase, refinance, new construction, or substantial rehabilitation of a project," according to its website.
If Parham is being sold, HUD said the current owners would either need to pay off the remaining balance on the loan or the purchasers would assume the rest of the balance, which would require HUD's approval.
As of late July, HUD said it had not been officially notified of a sale for Parham.
According to internal emails obtained through a public records request, legal counsel from Williams Mullen informed VDH that "HUD issues are expected to delay the closing until approximately September."
However, the lawyer said the new operators would like to assist Parham in the meantime through a temporary consulting agreement.
"Our client believes that delaying its involvement until the anticipated September closing would unnecessarily prolong existing operational challenges and could impede efforts to improve the facility for the benefit of its residents," attorney Jim Bailey said in an email June 17.
VDH responded that it has no regulation prohibiting such an agreement.
Prestige '100% confident' positive changes are on the way
"Let me ask this because there might be people watching this story who will be skeptical. You know, they are aware of the history associated with these nursing homes. They see a name change, a rebrand, new management, but they might think this is just kind of part of the cycle. How do we know anything will actually change? What would you say to those people?" Layne asked.
"I would say to those people that we're a company that came in here because we really believe that the patients that are entrusted to us deserve great care, and we know that we can provide that. And so I would encourage them, you, in a year from now, to come back, talk to the families and patients that you've advocated for in the past, and really have them speak to the changes that they feel have occurred. And I think that you'll be very happy with the results of it," Mulvey said.
"How confident are you that there will be a meaningful change in a year?" Layne asked.
"I'm 100% confident that that's going to happen," Mulvey said.
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