By:

Dave Kingsley

Corporate Neglect and Abuse of Nursing Home Patients: A Low Risk-High Reward Practice

    Why do nursing home corporations provide suboptimal and neglectful care while earning robust profits?[i]  Because they can.  Although the “law” is merely the codification of our morals, values, and ethics, it is of little consequence when it is not respected and enforced.  Joe Sopcich’s article that accompanies this post indicates how laws and regulations designed to protect patients in nursing homes are pervasively ignored by providers while agencies of government fail to pursue remedies and hold culprits accountable.

    Joe writes about what desperate family members experience when they seek help from agencies charged with enforcing the rights of nursing home patients and families. This happens to poor and affluent families alike.[ii]  His late  mother was a patient in the skilled nursing facility of a continuing care residential community (CCRC) – one of those retirement places where people can live through and receive services from independent and assisted living to skilled-long-term nursing home care.  The experience described in the article is quintessential.  Neglect of this type is pervasive while agency enforcement of codified patient rights is weak and ineffective.

    The industry benefits financially from lack of oversight and accountability.  Understaffing and low pay results in lower costs and increased cash flow – that is, unjustifiable cost cutting enhances and protects shareholder value. Furthermore, the industry has successfully disseminated and sold a false narrative constructed on a “financial hardship” theme that has no relationship to reality.  Their message is that nursing homes are “running on a thin net,” or earning skimpy amounts for shareholders.  This is nonsense but has not been adequately confronted by advocates and the media.

The Larger Context of Industry Neglect and Government Nonfeasance

    Agencies can fail to hold tax-funded nursing home businesses accountable because the elderly have been devalued by media misinformation/disinformation, junk science, and even by the most prominent scholars and influencers in the field of bioethics. Furthermore, medical technology and science have increased life expectancy while social attitudes toward the elderly have evolved in a rather disturbing way. Older Americans are now seen as a problem for and even a threat to younger age cohorts.

    According to many highly influential economists and bioethicists, the United States simply can’t afford to provide all the healthcare needed by the growing elderly and disabled cohorts in a population of 330 million residents (approximately, based on 2020 Census). Medicare has been demonized as a budget busting monster robbing young people of needed healthcare.  This is not true. Medicare expenditures are not an economic burden and threat to the U.S. economy.

    More disturbing than the harmful misinformation generated by the economists and bioethicists is the lack of interest in and discourse concerning the morals and values of care of such low quality that it amounts to euthanasia by neglect.  This post is the first in a series of posts that will call attention to the nature of a cruel, inhumane, institutional care system for frail patients needing skilled nursing care in the context of current medical and societal values and ethics.  It is the entire money-driven system and the absence of discourse regarding morality that is harming patients and shortening their lives unnecessarily. It is to that issue we want to call attention and about which we want to stimulate discourse.

    Our point of departure in this discussion is the necessity of dehumanizing groups of people before they can be scapegoated and harmed by government policy with the approval of the broader society.

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[i] Apart from The Ensign Group, which owns and/or operates approximately 300 facilities, nursing home corporations are closely held.  Therefore, it is not possible to obtain the exact net operating revenue from facility cash flow.  Based on my analysis of cost reports, I would estimate that “free cash flow” or “owners’ earnings” ranges from 10 to 15 percent.  For instance, In 2023, the Ensign Group had net operating revenue of $376.7 million on $3.7 billion in revenue or 10% in free cash flow.  The distribution of earning to investors are increased through avoidance of capital gains taxes.  Furthermore, the operations side of the industry is separate from the lucrative commercial real estate side.  The Ensign Group is sheltering the corporation from capital gains taxes due to property appreciation by forming a captive REIT or by transferring property to an UPREIT.  A large number of executives and investors have individual or family trust for sheltering their compensation and assets.  Black Rock, Vanguard, State Street and other major asset managers are the dominant investors in the Ensign Group, REITs, and private equity groups. See: 0001125376-24-000018 (d18rn0p25nwr6d.cloudfront.net, page 96.

[ii] Joe is the former president of one of the best community colleges in the United States. 

My KDADS Journal

By:

Joe Sopchich

    This incident occurred in the state of Kansas. I made the decision to reach out to KDADS (Kansas Department for Aging and Disability Services) to report the details of my mom’s experience regarding her care, or rather the lack of care. It was recommended to the family that we make contact with KDADS to report the details of our experience and observations regarding our mother’s care, rather the lack of care. Upon reading this report, you will not have learned much, if anything, about how this agency is supposed to advocate for patients in the confines of eldercare businesses within the state. The descriptions of mission and purpose on their website makes all the proclamations one would expect. Despite the advice of many, I filed my complaint.

The journal of events follows:

January 2023 – I am the patient’s son. I thoroughly studied the KDADS website to learn their required procedures for communicating a grievance. It informed me that upon submitting a request for assistance, I would promptly receive an email that provided a case number to initiate the assistance process.

March 20, 2023 – I forwarded my complaint via registered mail to the KDADS office in Topeka. I followed all the protocols as required on the website.

April 11, 2023 – Having received no acknowledgement from KDADS, I called and left a message that I had not heard from them.

April 12, 2023 – I received a call at 8:50 AM informing me they had not received my complaint. I called the local Post Office, and they said it was delivered at 11:57 AM on March 21. I called KDADS at 10:36 MM to give them the exact date and time of delivery. The person looked for it, found it, and apologized for “misspeaking” earlier. I was told it was assigned to a “surveyor” and once the process was over I would be contacted. I figured my complaint was laying on a desk in the KDADS office for 22 days. A number was assigned to the case, #9003.

May 9, 2023 – Upon receiving no further contact from KDADS, two calls were placed during the day, neither of which were answered.

May 16, 2023 – Again, a call was placed and not answered. I left a message on the recorder. The call was returned at 1:45 PM to inform me that the investigation ongoing. I was provided with the name, email address, and phone number of the KDADS regional manager.

June 22, 2023 – More than one month has passed with no contact or report from KDADS on the status or outcome of the investigation. Another call was placed at 11:00 AM with a message left to ask for an update. The call was returned later in the day, and this time I was informed that a “surveyor” had not yet been assigned, despite being told two months earlier that an investigator was on the case. I was referred again to the regional director. It was three months since I filed my complaint.

June 23, 2023 – Frustrated, I wrote a letter to the Governor’s office including my original complaint and concerns. I never received an acknowledgement.

June 28, 2023 – I called the regional director’s office at 1:40 PM and left a message. The call was never returned.

July 11, 2023 – I received a call from KDADS. I missed the call. I thought maybe the Governor forwarded my complaint to the KDADS office, hence the call.

July 12, 2023 – I returned the call from the day before and again it was not answered.

July 18, 2023 – The call I referred to in the two previous entries was finally returned at 4:45 PM. The person asked, on the recording, “if there was anything they could do.” This occurred almost five months after I submitted my complaint. 

July 19, 2023 – I returned the call again and had to leave a message due to no one answering. The call was never returned.

August 17, 2023 – Six months after filing the formal complaint, another call was placed to the KDADS office at 2:30 PM. This time I was informed that too much time had passed since my mother had expired when I originally filed the complaint. This was the first time I was told there was a time statute for such complaints, despite the fact that a case number was assigned and an investigation had been supposedly launched. I asked her to have the person I spoke with earlier to call me. I never received a call.

October 17, 2023 – I received a call in the late afternoon from the surveyor who had apparently been assigned to the case even though two months earlier I was informed the case was rejected do to the statute. Upon confirming the case number was correct she told me she was about to walk into the SNF facility to examine and review the information on file about my mom. 

December 17, 2023 – Nine months after filing the complaint I received a letter from KDADS informing me that the investigation of the complaint had been completed and the facility was found to be in compliance with regard to all allegations.  The case was closed. The letter also cited various state codifications related to the required confidentially of the findings. They are not available to the public.

All of the dates and details contained in this catalog are accurate according to my recollections. As the saying goes, you can’t make this stuff up. But most important, KDADS once again failed a citizen of Kansas, his loved ones, and, most importantly, my mother. The fact is that in the state of Kansas when it comes to finding accountable care facilities, you are on your own.