Nursing home owners and operators have pleaded “poor us” through a lethal 2020. But profit-seeking players in the industry clearly still see rapacious opportunity in long-term care facilities — with residents suffering the consequences.
NPR and the Washington Post both have dug into the results when investment groups or chains acquire and operate nursing homes, and, as the media organizations reported, resident care declined.
The newspaper focused one of its deep digs on long-term care on New Jersey-based Portopiccolo Group, and how it “buys troubled nursing homes and tries to make them profitable,” paying “hundreds of millions of dollars to acquire facilities in Maryland, Virginia and elsewhere,” with little federal, state, or local oversight of its acquisitions.
The group defends its practices and performance, including during the coronavirus pandemic. Still, as the Washington Post reported:
“Many of Portopiccolo’s existing facilities were struggling to contain outbreaks of the coronavirus when its leaders went seeking new properties, state health records show. At a Virginia nursing home, staff hosted a hallway dance party for residents in April, weeks after federal guidelines had cautioned against such events. Conditions were so bad at one North Carolina facility that it was placed on a federal watch list even after the Centers for Disease Control and Prevention dispatched a strike team to help. At its new nursing homes in Maryland, Portopiccolo’s operating companies made major changes to insurance and time-off benefits, failed to buy enough supplies and protective equipment, and asked some employees to keep working after testing positive for coronavirus, said 14 current and former employees from four of the eight facilities. Many veteran staffers quit as a result of the changes, said the employees, most of whom spoke on the condition of anonymity because they feared reprisals. Those who remained found themselves tending to dozens of residents at a time, the employees said.”
Slashing costs as the operating plan
The newspaper found that the company specializes in slashing costs in problem facilities it acquires, even though these nursing homes already may be shaky with their resident care. This meant, as regulators would find, that the company skipped crucial repairs, allowing residents at one facility to go without basic hygiene like showers because a water heater got replaced — slowly. When the pandemic struck and low-paid aides left or quit and replacements were hard to find for all nursing homes, Portopiccolo facilities struggled even more:
“An analysis of federal data shows that nearly 70% of facilities Portopiccolo owned before the pandemic have Medicare ratings of one or two stars out of five — based on patient-care metrics such as staffing ratios and infection control. Two Portopiccolo facilities last month were placed in a federal monitoring program for having ‘a history of serious quality issues’; two others were listed as candidates because of severe deficiencies. Prior to the pandemic, the firm’s facilities in North Carolina were fined more than $480,000 for violating state and federal rules, federal data shows. One facility placed in the monitoring program was the Citadel Salisbury, a one-star nursing home in Salisbury, N.C., where more than 150 staff and residents have contracted the virus, according to state data. Employees and residents alleged in a lawsuit filed in Rowan County Superior Court that Portopiccolo, which bought the facility from Genesis HealthCare on Feb. 1, left the nursing home woefully unprepared for the pandemic. Employees testified in sworn affidavits that managers from Accordius, the operating group, prohibited staff from wearing masks in March, saying that doing so would scare residents. Nurses sometimes had to care for more than 50 residents at a time, employees alleged.”
The complications of race in long-term care
In the Atlanta area, NPR reported finding challenges in a different ownership by a group or chain, the Arbor Co. — with its issues complicated by matters of race. NPR drilled down into what happened at the company’s long-term facility Arbor Terrace at Cascade, reporting:
“In all, at least 17 residents [of the facility] died, 54 residents tested positive, and 36 staff tested positive. It is the worst outbreak among the 11 Georgia locations managed by the Arbor Co. There’s another key difference between this Arbor Terrace and the others: In Georgia, it is the company’s only facility in a predominantly black neighborhood. That has left the families of the dead to wonder what exactly went wrong and whether racism played a role. NPR looked into what happened at Arbor Terrace at Cascade to try to answer that question. Through government records and interviews with families, residents, and former staff, a more complete picture of the outbreak emerged. The Arbor Co. left Cascade residents and staff inadequately protected at a crucial moment, and this particular facility could not afford missteps. Systemic factors — including its location in Atlanta and its particularly vulnerable population — made this place both more susceptible and more vulnerable to the virus and, perhaps, its staff less equipped to respond.
“The result reflects a grim national pattern that has endured throughout the pandemic’s many months: Black Americans are getting and dying from Covid-19 at higher rates than white Americans. The outbreak at Arbor Terrace at Cascade offers a glimpse into factors that contribute to that disparity at a place where some of the families did not expect it to play out. ‘Even though you achieved all these things, at the end of your life, you are in essence, and I hate to say this, you were in some Covid-infested center,’ said Tricia Johnson, the daughter of a resident who tested positive but survived. ‘I mean, their brand has definitely been tarnished, but it doesn’t appear it’s going to be tarnished in the white areas.’”
Litigation has begun over how the facility dealt with residents, NPR reported:
“Four families, including Mann’s, have ongoing lawsuits against the Arbor Co. The lawsuits allege that staff failed to wear personal protective equipment, or PPE; that asymptomatic staff who had been exposed to Covid-19 continued to work; and that the company failed to restrict outside visitors. The company denies any wrongdoing.”
But residents and families say that owners and operators of long-term care facilities, like the Arbor Co., carried a greater responsibility to black residents and their families of because of the known vulnerability of communities of color to the coronavirus for multiple reasons:
“Not only did the company’s missteps at Arbor Terrace at Cascade leave it susceptible to an outbreak, but more systemic factors, such as the facility’s population and its location in Atlanta, meant those missteps ultimately proved disastrous. Assisted living facilities, which are home to about 800,000 mostly older Americans, are especially vulnerable to infectious diseases: You’ve got a vulnerable population living together with workers coming in and out. Today, nearly 40% of all the U.S. Covid-19 deaths have happened at long-term care facilities such as assisted living facilities, retirement communities and nursing homes.
“Arbor Terrace at Cascade was no different. But once the virus was inside the facility, it might have hit those residents harder. African Americans have higher rates of diabetes and high blood pressure, and higher death rates from heart disease. Health disparities such as these have been attributed to systemic racism, and those particular conditions also put individuals at higher risk for severe complications from Covid-19. Not only that, but a facility surrounded by more cases of the virus matters. One June study found COVID-19 cases in nursing homes across the country are more related to location rather than whether the facility had a poor rating or past infection control violations … Most of Atlanta is part of Fulton County. That county has about 10% of Georgia’s population, but by March 21, it had nearly 20% of the confirmed Covid-19 cases in the state. And within Fulton County, the area near Arbor Terrace at Cascade in southwest Atlanta was hit harder still in the pandemic’s early weeks.”
A call for deeper, broader reforms in long-term care
A broader focus is needed for reforms by federal officials charged with overseeing long-term care, E. Tammy Kim, a New York Times opinion writer argued in a detailed Op-Ed. She reported that these facilities no longer provide housing alone. Instead, due to federal old-age programs like Medicaid, they increasingly have gotten filled with the nation’s oldest, sickest, and most vulnerable. They function less like residences and more like hospitals — but without the people, equipment, or resources to provide that higher level of treatment.
Further, she said that the industry suffers from a lack of financial transparency and owners and operators may be maximizing their profits on the backs of residents and low-paid, overworked staff:
“Long-term care continues to be understaffed, poorly regulated and vulnerable to predation by for-profit conglomerates and private-equity firms. The nursing aides who provide the bulk of bedside assistance still earn poverty wages, and lockdown policies have forced patients into dangerous solitude. A few weeks ago, nursing home workers and residents began to receive vaccinations for the coronavirus, but even full immunization will not allay the tragedy that has unfolded in long-term care — not just the deaths, but also the isolation and neglect … When the pandemic is finally history, we’ll need to deal with all of this: the staffing shortages, low pay and lack of accountability — the many ways we have failed residents, family members and staffers. The awful truth is that long-term care was designed to fail years before Covid-19.”
Federal funding that goes to long-term care, especially through Medicaid, must be distributed and monitored far better, so it does not go into investor pockets and executive salaries and perks — at the expense of front-line patient care, Kim argues.
She says that the federal government must step up its oversight of services in an industry that a growing and significant segment of Americans will be in dire need of, including taking greater responsibility from the states for regulation of not only nursing homes but also assisted living facilities.
A complex web of inter-related businesses
The Washington Post, separately, detailed how nursing home chains — specifically the California operation known as Brius Health Care — boost their profits by creating complex webs of inter-related businesses. As the newspaper found:
“Brius Healthcare received more than $800 million from Medicare and Medicaid in 2018 to care for thousands of elderly residents in about 80 nursing homes. Instead of relying upon outside vendors, Brius pursued a business practice long used by a majority of for-profit nursing homes nationwide: paying related companies for goods, services, and rent. More than 70% of the country’s nursing home providers use operating funds to pay themselves through so-called related parties — companies they or their family members partially or wholly own. In 2018, Brius nursing homes paid related parties $13 million for supplies, $10 million for administrative services and financial consulting, and $16 million for workers’ compensation insurance, state records show. The homes also sent a total of $64 million in rent to dozens of related land companies.
“The practice is legal and widely supported by the industry, which argues that related parties help control costs and limit financial liability. Watchdog groups counter that nursing home owners can reap excessive profits from public funds by overpaying their own companies. Related parties generally do not have to disclose profits, leaving regulators with little way to assess the financial gains of owners.”
The newspaper also reported this:
“Watchdog groups are also pressing for legislation in California, where few providers have drawn as much scrutiny as Brius Healthcare. The operation, primarily owned by Shlomo Rechnitz, has for years found itself in the public eye, questioned by state regulators, prosecutors and plaintiffs’ attorneys about its business practices and quality of care. Staffing levels and health and safety ratings at dozens of the homes in recent years have fallen below the state average, federal data shows, and lawsuits alleging poor patient care have drawn headlines.”
In my practice, I see not only the harms that patients suffer while seeking medical services, but also the damage that can be inflicted on them and their loved ones by neglect and abuse at nursing homes and other long-term care facilities. These facilities and their owners and operators have drawn greater public attention and outrage, as crises — not just the pandemic but also hurricanes and wildfires — have laid bare the risky and sketchy conditions in which they put residents and their families.
The terrible toll of the coronavirus has pushed concerned parties past their limits, with residents and their loved ones demanding greater federal, state, and local oversight of the facilities and considering cases in the civil justice system, fearing they cannot otherwise get justice for harms they have suffered.
The current regime in power in Washington, D.C., cannot hit the exits fast enough, considering the tsunami of infection and death that has occurred nationwide, and especially among the most vulnerable elderly, injured, and sick institutionalized and in long-term care. The new Congress and the incoming Biden Administration will have its hands full, not only in putting down the raging virus (especially by vaccinations of residents and facilities’ staff) but also in better determining how this country will deal with long-term care. Many more Americans may hope that affluence and technology will allow them to age in place, in their own homes. But millions will require more assistance there or institutionalization, as their cognitive and physical capacities diminish.
We’ve got a lot of work to do, so the vulnerable find safe, affordable, and dignified places to live the fullest lives possible — not to be consigned to waste away and die.
