The literature shows that for-profit nursing homes have better financial performance but worse employee and client well-being compared to not-for-profit homes.
Dr. Greg Vigna, national malpractice attorney and wound care expert, says, “Unfortunately the literature clearly points out that private ‘for-profit’ nursing homes have better financial performance but worse employee well-being, and worse client well-being compared with not-for-profit homes. It is my opinion that information regarding ownership is necessary for consumers to have access to information on safety and outcomes.”
Dr. Vigna continues, “The current system of disclosure to the public is presented on ‘Care Compare’ and the Government Accountability Office found that “Care Compare does not allow consumers to easily identify relationships, such as common ownership” so that the consumer can identify “patterns related to quality across nursing homes under common ownership.”
Dr. Vigna adds, “The reasons for this lack are clear and are supported by the literature that nursing home chains use nursing homes as a revenue center and create multiple layers of Limited Liability Companies that provide services to the nursing home such as skill therapy services for residents, outpatient services, and hospice services for those who are discharged that allows other companies of common ownership to profit by providing these services. In addition, many of the nursing home real estate are owned by REITS that allow rents to be paid that decrease the taxable income of nursing homes while REITS enjoy independent tax advantage.”
“The Government Accountability Office reported to the House of Representatives that CMS Should Make Ownership Information More Transparent for Consumers, as the quality of care is tied to ownership.” — Greg Vigna, MD, JD
Dr. Vigna, “The various layers of ownership with LLCs and REITs also are devised to limit liability. We represent those with hospital and nursing home decubitus ulcers. We understand that many chains are run by private equity firms that have no business in making decisions that affect care at the bedside. We understand that their decision doesn’t just impact our client’s nursing home, but nursing homes across the chain. These entities provide multiple services under multiple LLCs and it is imperative to analyze the structure and ownership of these entities during discovery.”
Dr. Vigna comments, “Unfortunately patients who suffer decubitus ulcers from inadequate care at nursing homes are being ‘fast-tracked’ to hospice owned by nursing homes. Access to state-of-the-art care must be guaranteed for those injured at the hands of nursing homes and patients must be treated as humans in need of care that they choose, and not simply represent a revenue source for nursing homes. Profits must be spent on bedside care, as Grade III and Grade IV decubitus ulcers are deemed by CMS to be ‘Never Events’. There is plenty of money being paid for healthcare and it needs to be spent at the bedside.”
Greg Vigna, MD, JD, is a national malpractice attorney and an expert in wound care. He is available for legal consultation for families and patients who have suffered decubitus ulcers because of poor nursing care. The Vigna Law Group along with Ben C. Martin, Esq., of the Martin Law Group, a Dallas Texas national pharmaceutical injury law firm, jointly prosecute hospital malpractice and nursing home neglect cases, nationwide.
To learn about ownership, financing, and management strategies of for-profit nursing home chains, read here.
Read more about ownership information transparency for consumers in nursing homes.
This article delves into cross-country comparisons of trends in for-profit nursing home chains, including ownership, corporate strategies, quality, and more.
Greg Vigna, MD, JD
Vigna Law Group
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