Pinnacle Health Care Group, a New York firm intends to buy Coastal Manor, a Yarmouth nursing home for $2.5 million. Will Hall/Staff Editor

A New York nursing home company intends to expand its Maine footprint with the purchase of a Yarmouth facility, as other care homes struggle to stay open amid rising costs and a staffing crunch.

Pinnacle Group of Hudson Valley last month notified state regulators that it wants to purchase Coastal Manor, a 45-bed nursing and residential care provider on West Main Street in Yarmouth. Pinnacle, headquartered in Monsey, N.Y., said it will buy the business and property for $2.5 million.

Coastal Manor is owned by Orey Gadway, a Yarmouth resident who bought the nursing home nearly 40 years ago. There was no response to an interview request left at the business Thursday.

Pinnacle CEO Israel Nachfolger said Gadway wants to retire and approached the company with the idea of taking on his business. Pinnacle bought its first nursing home in Maine in 2015 and now owns four facilities in Canton, North Berwick, Sanford and South Portland. Pinnacle does not plan any changes to staff or operations at Coastal Manor, Nachfolger said.

“I am trying to help … the operations continue,” he said. “It has been a fixture in the community and I don’t know he (Gadway) had many other options to transition to (retirement).”

Nursing homes and other long-term care facilities have become harder to keep afloat in recent years as owners face a labor crunch for nurses and spiraling expenses. Last year, at least four Maine nursing homes shuttered and two Maine Veteran’s Homes in northern Maine narrowly avoided closing after an infusion of state cash.


Small nursing homes with a few dozen beds or less are facing even more challenges than larger facilities, Nachfolger said. Coastal Manor operates 39 beds with skilled nursing and six providing residential care.

Locally owned homes face high energy and other costs and an acute shortage of skilled nurses, challenges magnified by a reliance on Medicare payments that don’t keep up with expenses, he said. The increasing use of contract nurses with hourly wages that are sometimes triple local rates has made the problem worse, according to Nachfolger.

His company is larger and has efficiencies that can absorb some costs, he said. But Maine nursing and long-term care homes will continue to struggle unless the state does more to train local nurses and make the business model sustainable, he believes.

“We are hoping the Mills administration will take a look at this and see it as an inflection point right now,” Nachfolger said.

Nursing home sales need to be approved by the Department of Health and Human Services, said department spokeswoman Jackie Farwell. There appears to be more consolidation of nursing home businesses in Maine as companies seek ways to reduce costs.

“There has been a slight uptick in nursing home sales in recent years, including a trend away from sole proprietorship toward corporate ownership,” Farwell said.

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