DEMOCRACY, CORPORATE FINANCE, & MEDICAL ETHICS

Nursing Home Companies are Making Money but are Not Telling Taxpayers the Truth About it.  Our Deductive Reasoning Skills Can Easily Reveal the Truth.

Welltower Corporation is a major player in the nursing home industry. Indeed, it is the dominant player.  The major share of its $4.72 billion in 2021 revenue is provided by U.S. federal and state governments – from the taxpayers of America.  Their business is senior housing real estate and medical care for people residing in their nursing home properties. 

The public has a right to expect that medical care is the overriding mission of corporations involved in tax funded nursing care. That is not how Welltower executives view their role in the privatized, publicly funded, healthcare system.  In their 2021 annual report they stated, Our primary objectives are to protect stockholder capital and enhance stockholder value. We seek to pay consistent cash dividends to stockholders and create opportunities to increase dividend payments to stockholders as a result of annual increases in net operating income and portfolio growth (https://welltower.com/wp-content/uploads/2021/04/2020-Annual-Report.pdf, p. 2, accessed 5/21/2022).

Welltower is one of the few nursing home companies listed on a public stock exchange.  As their annual reports and the value of their stock in the current market crash indicate, they are achieving their financial objectives.  As the Dow, S&P, and NASDAQ have tanked in the past few months, shares of publicly listed nursing home-related corporations are at, near, or above their value in late November when the markets began to sink at significant and at times precipitous rates. 

These are solid corporations loaded up with commercial real estate, the value of which is enhanced by guaranteed revenue through Medicare, Medicaid, and generous tax advantages – gratis the U.S. taxpayers.  This is the reason asset managers such as BlackRock and Vanguard have guided $billions of pension, sovereign wealth, and family office, funds, overseen by institutional investors, into asset-laden nursing home companies. As the markets fall, they are not moving money out of these equities and seeking a safer haven (In a blog post today, I provide an analysis of the stock performance of nursing home and other government-funded medical care corporations between the end of November 2021 and the end of May 2022).

The Big Lie from the Nursing Home Industry: “We Aren’t Making Enough Money to Provide Medically Ethical & Humane Care.”

Thousands of privately held corporations in the form of Limited Liability Corporations, Limited Partnerships, and other legal structures own from a few to a hundred or more nursing homes. Examples include, the privately held Pruitt chain, Diversicare, and several other substantial chains operating in various parts the United States.  Years of interviewing employees, families of patients, reading inspection reports and media accounts, have convinced me that medical care in these facilities is substandard to nonexistent.  Abuse and neglect are pervasive.  Most of the care is provided by medically nonqualified and extremely low paid nursing assistants.  Generally speaking, these are inhumane institutions. The thought of ever ending up in one is horrifying to most people.

Industry Prevarication & Misinformation about High Investor Returns

Although, evidence overwhelmingly suggests that investors are reaping huge returns from shoddy care, the American Health Care Association (AHCA) –  the major industry lobbying firm and industry propaganda arm in Washington and the 50 states – successfully promotes a big lie:  “provider net income is so low that they can’t treat patients humanely or pay higher salaries and wages.” On its face, that is absurd. But apparently it hasn’t dawned on legislators, bureaucrats, and the media that investors wouldn’t be investing in a venture with low returns while so many opportunities for high returns are available in the financial markets.

My colleague, professor Charlene Harrington, and I have debunked that argument as it pertains to publicly listed companies. We, like the rest of the public, have access to financial statements required by the Securities and Exchange Commission (SEC).[1]  However, we do not have access to consolidated financial reports for privately held companies. We can’t see their income statements, balance sheets, or cash flow statements. Therefore it is very difficult to evaluate industry claims regarding earnings – difficult but not impossible.

Each of the approximately 13,000 facilities licensed to provide nursing care and certified to be reimbursed by Medicare and Medicaid are required to submit “cost reports, which include revenue, expenses, net income, and a host of other financial metrics.  With the exception of California, these CRs are difficult to obtain. But we have now gained access to every filed CR in the U.S.  Our analysis so far is telling us that the low net claim is a big lie; that fraud is rampant; and, that states are failing to audit the reports.

Low Risk, High Return Fueled by Government Funds with Little Financial Oversight: the Reality of Nursing Home Investing

As we pour over CRs – mostly in California, New York, North Carolina, and Kansa – we see reported net income as a fiction.  We have also come to believe that the low 2020 net of .5% claimed by AHCA and its hired propaganda accounting firm Clifton, Larson, and Allen (CLA) is scurrilous nonsense – unbecoming of the 8th largest accounting firm in the U.S.

 As one example, misinformation, if not outright fraud, is replete in the CRs of 25 Kansas facilities owned by Florida based private equity firm Windward Health Partners, LLC. Although the average net income reported by these facilities is 8.6% – far higher than the average claimed by AHCA & CLA – they are not reporting payments to their own property LLCs. Also, their chain goes goes by the name of Mission Health Communities. What they don’t note on their CR is that MHC is a related party – a management LLC set up as a company they own and are paying to manage their facilities. Hence their net is drastically lowered due to payments to other companies they own.

 Although Mission Health Communities is falsely noted as the owner of these facilities, it exists as the typical private equity squeeze forced on victim companies.  Mission Health Communities is paid a management fee but is, in reality, a separate LLC in the Windward Health Partners portfolio.  That payment, along with a lease payment to a property LLC, and perhaps other payments to Windward owned ancillary services such as therapy, are expensed on the income statement. In effect, these facilities are making payments to entities owned by their parent corporations and reducing their net income reported to the State of Kansas.

According to CRs submitted by Windward, Kansas taxpayers paid the company $103,403,493 in total 2020 revenue. Because of omitted information and opaqueness of the system, only company insiders know how much cash flowed out in the form of lease payments, management fees, and possible other ancillary services. The 25 facilities received an average of $249,063 in COVID relief payments. I say cash because these payments to itself is gravy for partners and limited partners in Windward Health Partners, LLC.

Democracy & Medical Ethics

The people of Kansas have no idea about how their tax dollars are flowing out of their state into investment firms like Skyway Capital Partners of Tampa Bay, Florida – the financial firm that has capitalized Windward Health Partners. That is not because Kansas residents are dumb. Rather they don’t know how government funds flow from facilities to parent corporations structured as private equity, LLCs, C and S corporations, and limited partnerships, because the system is designed to operate behind a veil of secrecy. For the most part, the Kansas legislature and state bureaucrats have been captured by the industry.

Employees at the Kansas Department of Aging & Disability Services are far more protective of industry financial secrecy than they are of the public’s right to know how their tax dollars are being utilized. The deck is stacked in favor of the industry. Getting substantive information from KDADS is like getting red meat out of a tiger cage.

Medical care is substandard in nursing homes across Kansas but shareholder value overrides medical ethics. Indeed, you will be hard pressed to find a physician around a nursing home at any given time. You will also be hard pressed to find more than a hand full of physicians who really give a damn about what goes on these institutions. The medical profession is silent, the bioethics profession is silent, and the voters are kept in the dark. That’s not how democracy is supposed to work.


[1]Kingsley D, Harrington C. (2021) “COVID-19 had little financial impact on publicly traded nursing home companies.) J Am Geriatr Soc. 2021;1–4. https://doi; Kingsley, D Harrington, C. “Financial and Quality Metrics of A Large, Publicly Traded U.S. Nursing Home Chain in the Age of Covid-19, International Journal of Health Services, 1-13, https://doi: 10.1177/00207314221077649.

Are Nursing Homes a Good Deal for Investors? Don’t Believe the Nursing Home Industry’s Propaganda: Look at How Their Stock is Doing as the Market Tanks.

By

Dave Kingsley

The Market has Tanked but Most Nursing Home Stock Made Significant Gains or is Holding Steady At or Near its High of Late November

According to the American Health Care Association (AHCA), the nursing home industry lobbying and propaganda organ, providers struggle to squeeze out a tiny profit from a very tough business. As anyone who reads this blog will surmise, I don’t believe that and have an abundance of evidence to debunk the “low margin/profit big lie.”

One place to look for evidence of the industry’s big lie is the network of stock exchanges and indexes: the NYSE, NASDAQ, DOW, and S&P 500. The performance of nursing home industry shares in relation to these exchanges and indexes are indications of how they are viewed by major investors such as BlackRock, Vanguard, Charles Schwab, and other asset managers for institutional investors such as pension, college endowment, sovereign wealth, and family office funds.

At the close of the market on Friday, May 20th, 2022, the value of assets on the NASDAQ had dropped by 30 percent from its high on November 29th, 2021. The DOW was down by 11%, and the S&P closed 16.2% lower. As the table below suggests, the stock of the small number of publicly traded nursing home corporations has overall fared very well in a market downturn of major proportions. Seven of the 10 corporations that are players in the nursing home industry have minor to very large increases in their share prices since November 29th.

Genesis corporation is no longer listed on a major exchange such as the NASDAQ. At one time, Genesis was the dominant player in the industry. Due to a private equity takeover and subsequent looting, its value (market cap) sank so low that it is now traded over the counter (OTC) as “penny stock” worth 10 cents a share. Hence, a drop from 22 cents a share in late November to 10 cents at the close on Friday, is a 55% drop that has little to do with the overall value of the industry.

COMPANYPRICE 11/29PRICE 5/20% CHANGE
BROOKDALE$6.30$5.48-13
ENSIGN GROUP$77.20$79.03+2.3
HEALTHPEAK$34.06$29.42-13.6
LTC PROPERTIES$31.91$37.28+16.8
NATIONAL HEALTH CARE$65.82$69.86+6.1
NATIONAL HEALTH INV.$52.29$55.78+6.6
SABRA$13.03$13.13+.76
VENTAS$49.12$56.52+15.1
WELLTOWER$82.04$88.11+7.4
GENESIS$0.22$0.10-55.0
CARETRUST$20.18$17.27-14.4

Medicaid is a Disgrace

By:

Dave Kingsley

The Medicaid Program Has Roots in Segregation & Racial Hatred

Among economically wealthy and technologically advanced countries in the world, Medicaid is a medical system unique to the United States.  The program was conceived and forced on the American people by segregationists in the Democratic Party during the Johnson Administration.  Segregationist Congressman Wilbur Mills, powerful chairman of the House Ways & Means Committee in the 1950s and 60s, was able to hold President Johnson’s Medicare legislation hostage until he agreed to a poverty medical care system which gave states considerable power over administration of programming and qualifying criteria.

Segregationists from states such as Arkansas, Alabama, Georgia and other states of the deep South saw poverty medicine for which people would have to prove to a state agency that they were eligible, as a means for keeping poor people – especially poor African Americans – from receiving health care. In the 1960s, the segregationist South was still the agricultural South which relied on cheap labor.  Furthermore, intense Jim Crow hatred of Southern African American citizens was incompatible with anything that might raise their status above a level of serfdom and humanize them. (See Jill Quadagno One Nation: Why the U.S Has No National Health Insurance, 2005, pp. 13-14; Gerard Boychuk, National Health Insurance in the United States and Canada:  Race, Territory, and the Roots of Difference, 2008, pp. 59-79; my chapter “Implementation of Medicaid-Funded Long-Term Care:  The Impact of Prior History on the Development of the Nursing Home Industry,” in Max Skidmore & Biko Koenig, Anti-Poverty Measures in America, 2019).

Medicaid is means-tested.  Americans must prove that they are impoverished to qualify.  This characteristic of the program has made state agencies and their bureaucrats the gateway to medical care for poor people who are required to experience the humiliating process of proving that they are too poor to get health care without government welfare.  One’s poverty must be so deep that only the poorest of the poor can qualify. In most states, the program is stigmatizing as legislatures and bureaucracies pile on humiliating barriers such as “proof of looking for work,” drug testing, and other criteria that should have nothing to do with receiving needed medical care.

Funding for Long-term & Skilled Nursing (Nursing Homes)

It is often said that placing nursing home funding in Medicaid for individuals unable to self-pay the daily rate in most facilities – or have spent down their life savings until they are impoverished – was an afterthought – that there was no purpose or rationale to making it a Medicaid program.  That was the position taken by Bruce Vladeck in his excellent but now outdated history of the system. (Unloving Care: The Nursing Home Tragedy, 1980).  I don’t believe that. 

It is my opinion that legislators like Mills and Senator Kerr from Oklahoma could foresee the major real estate industry that nursing home care would spawn.  Privatization (corporatization) was well on it way when Congressman Mill and Senator Kerr conceived and were able to get the Kerr-Mills medical program for seniors through congress in 1960.  It was also means-tested and was the precursor to Medicaid.  Nursing homes care was an integral component of Kerr-Mills.  Kerr had ties to the nursing home industry and Mills was an ardent believer in utilizing government funds and tax codes for incentivizing private economic expansion (as opposed to expansion of government, non-profit growth).

Medicaid has Become a Perverse Toxic Program that Enriches Investors & Corporate Executives

In December 2021, the Center for Medicaid & Medicare Services announced that Medicaid expenditures had reached $671 billion.  A large proportion of these funds reimburse corporations for nursing home care, which is mostly substandard and despicable.  Revenue for the industry includes not only the ample reimbursement member companies receive for patient care but also all of the capital gains from real estate which derives value from a license to operate a nursing home.

Although states and the federal government tolerate and even facilitate a veil of secrecy regarding finance and the flow of capital through lending institutions and from reimbursement, enough evidence can be found to suggest that substandard care is enriching corporations and executives.  For instance, Welltower, a major Real Estate Investment Trust and operator of nursing homes paid its CEO $20 million in 2020.  Investors in publicly listed nursing home related corporations have received high earnings during COVID.  Stock of the publicly listed corporations in the business has continued to increase while the markets have been decreasing.

A huge amount of capital flowing through the Medicaid system isn’t reinvested in a better health care system.  It is pocketed.  Much of what is pocketed can’t be seen because the government allows investors in privately held companies hide their finances.

Another Commission to Study the Nursing Home System Isn’t the Answer

People who are appointed to prestigious commissions to study the nursing home system aren’t given to speaking truth to power.  Indeed, appointing a group of academics and other professionals to a commission sponsored by the National Academy of Sciences and important foundations will not solve the problem we all have, i.e., dread of ever being in a nursing home.

It is very risky for most people on a commission to tell the truth, which is that the medical system in the United States is driven by greed.  Money in politics is resulting in domination of government bureaucracies and legislators by the very people who need to be regulated.  Money is power and has become an increasing factor in U.S. politics. 

Recommendations to tweak this that or the other thing in a system so corrupt and inefficient that nothing less than total transformation will change much of anything will likely only reinforce that system. Recommendations to increase staffing will be resisted by the industry and frustrate advocates, unions, and the public because any change will be window dressing.

I don’t want to see a recommendation for “more transparency.”  I want the privately held companies to open their books and provide the same information that publicly listed companies provide to the Securities and Exchange Commission.  The truth of the matter is that the nursing home industry, indeed the entire health care industry, has become financialized.  Taxpayers are not receiving the increase in productivity and quality that matches the tax dollars they are forced to pay for their own care.

Data Analytics, The Stock Market, & Healthcare Justice

By:

Dave Kingsley

Current public relations carried on by the hospital and nursing home
industries are based on bogus claims designed to mislead the public. The
variety of wealthy lobbying organizations for the medical-industrial complex
are promoting false narratives based on either an invalid interpretation of
financial data (intentional) or making claims of hardship, e.g. “low net
margins” that are not supported by solid, scientific, factual information
(also intentional).

Big and increasingly dominant hospital and nursing home corporations have
sophisticated data analytic departments on which they rely for management
decisions affecting cash flow and shareholder interests. These multi-billion-dollar
companies determine razor thin margins acceptable for minimal staffing, pay,
food quality, training, and equipment. Even the smaller chains are implementing
productivity enhancement efforts with software designed to determine maximum
acceptable acuity levels for billing and cash flow.

Unfortunately, providers of long-term/skilled nursing care (i.e. nursing
homes operators) are not applying advanced technology and data analytics to
quality of care. I follow industry trade publications and financial reports and
can find no evidence that providers are employing sophisticated analyses to
efforts for optimizing the health and quality of care at a cost that returns a
reasonable value to executives and shareholders rather than a return that can
pass muster with regulators and legislators.

Because much essential financial data pertaining to tax supported medical
care operations are hidden from public view or nearly impossible to wrest out
of government agencies, advocates for patient and employee justice in hospitals
and nursing homes are in an asymmetrical fight with lobbyists. Because the
nursing home industry is more of a real estate/finance industry than a
medical/patient care industry, the lobbying power in federal and state
legislatures constitutes a juggernaut that can only be defeated through an
organized advocacy effort that fights for transparency and fully utilizes what
is available now to feed into a truthful narrative for media, legislative, and
research actions.

What Is The Stock Market Telling Us About The Financial Condition of
Nursing Homes & Hospitals After Two Years of COVID?

Some data pertaining to the financial condition of nursing homes and
hospitals are readily available from the U.S. Securities & Exchange
Commission (SEC). I have been tracking the stock of publicly listed
corporations with operations in nursing homes and hospitals. Most nursing home
corporations listed on a public exchange are real estate investment trusts
(REITs) that are becoming increasingly powerful in the long-term care/skilled
nursing business (they trade and lease real estate but also operate
facilities).

The last three months have not been good for the equities market. Stock
prices have been falling precipitously. But that’s not the case for stocks of
corporations in the business of providing tax funded medical care.

Brookdale Senior Living & The Ensign Group

Let’s consider the two biggest nursing home operators listed on a public
exchange that are not REITS: Brookdale Senior Living and The Ensign Group.
Since late November, the DOW has dropped approximately 3%, the S&P has
declined by 6.5%, and the NASDAQ has fallen by 17%. But these nursing home
corporations have gone in the opposite direction.

Closing price of Brookdale November 29, 2021 – $6.30 Close on February 26,
2022 – $7.00

Closing price of Ensign November 29, 2021 – $77.20 Close on February 26,
2022 – $82.19

So, Brookdale stock is up by 11% and Ensign stock is up 6.5% during the same
period we’ve seen a drop in the markets like we haven’t seen since March of
2020 when they crashed due to COVID but recovered rather quickly.

Most of the REITs heavily involved in the nursing home business have seen
their stock rise during the time that the market has been falling rapidly.
Welltower, the big one, is up 1%. Ventas, the other big one, is up nearly 8%.

Publicly listed hospital corporations are doing well also. HCA stock has
climbed from $229 in late November to $253 at the close yesterday – a 10.5%
increase. Tenet jumped from $74.46 to $85.71 since November 29th – a 15%
increase!

Why is the stock of these hospital and nursing home corporations doing so
well when the market is in correction territory? The primary reason is this:
they are heavily subsidized by the taxpayers. Indeed, their prices are set by
state agencies much like like utility company rates are set. They submit their
costs and are reimbursed for those costs plus increases for inflation and
healthy percentage increases above costs. Furthermore, they are structured for
each facility to pay lease expenses and other ancillary expenses to other
corporations they own.

Don’t believe the industry’s hardship pleas. That is all a lie. It is a
scurrilous behavior indeed for the American Health Care Association – the
nursing home industry lobby – and the American Hospital Association to be
putting out false information to snow the taxpayers who are so generous with
their subsidies for executive pay and shareholder dividends.

A Simple Truth: Nursing Homes are Run By Financiers – Not Medical Professionals

By:

Dave Kingsley

Nursing Home Investors Care about Cash Flow. They are Not Into Charitable Care.

It’s amazing to me how far nursing home industry lobbyists are getting with their hardship pleas. At this time they are being rewarded by legislatures for letting their workforce deteriorate to a crisis level. There are some simple truths – perhaps simple logic – regarding why qualified, competent medical professionals are hard to find these days.

Let’s start with the cutting edge of corporate finance: the “time value of money.” Investors calculate their free cash flow over five years before investing their money. Their decision is based on yearly cash flow discounted to the present time. This means that they determine what a dollar is worth at the present time versus what it will be worth in 1, 2, 3, 4, or 5 years if invested in a project or business. I won’t bother my readers with the formula for determining “net present value,” but debt financing of real estate and tax arbitrage play a major role in that calculation.

In the case of the nursing home industry, real estate is debt financed. Reimbursement for capital costs such as depreciation and interest typically exceed payment on loan principal and flow into the cash channel that will be “earnings” pocketed by investors. At some point, principals will equal and begin to exceed returns from real estate and debt tax advantages. The property will be flipped at that point.

Keeping food costs low, paying substandard wages, dangerously low staffing, and putting sick, fragile, elderly and disabled people in a room with a stranger are techniques for increasing cash flow from Medicare, Medicaid, self pay, managed care, and whatever other form of third party payer reimbursing care.

Why Would Investors Be in The Nursing Home Business if It Weren’t A Profitable Business?

Because privatized, tax-funded, medical care is financialized (finance overrides medical care) decisions regarding care are frequently and generally based on financial metrics. The quality of care is confined within the parameters of expected cash flow (discussed above). Furthermore, with “cash as King,” immediacy of returns rather than long-term planning and reinvestment for a better medical care system in the future drives decision making about staffing and overall conditions in acute care, long-term, and skilled nursing facilities.

The problem is this: the public, the media, and legislators do not have a good overall view of how the nursing home system works from a financial perspective. Federal and state agencies have been derelict in making accessible, understandable, financial and ownership data available to researchers and the public in general. California is more advanced in this regard than other states but still has a way to go in making the system fully transparent in that state.

In the past few weeks, I reviewed 2020 cost reports of 205 facilities in San Diego, San Bernardino, and Orange counties. I entered data regarding revenue, net income, number of beds, and the proportion of revenue from various third party payers (e.g., Medicare, Medicaid, Managed Care, etc.). As opposed to the claim from a Kansas nursing home lobbyist that providers have a median net income of 1/2 percent, I’m finding a median of close to 7% even though many claims of losses look dubious to me. Furthermore, net income is not a reflection of earnings or cash flow. Depreciation and interest are expensed on the income statement even though these are not cash expenses.

Nothing in the cost reports will tell us how much cash is extracted through real estate transactions. Nor do they indicate how much cash is flowing into parent corporations and holding companies. We know how much that is for public listed corporations – most of which are real estate investment trusts – because we can easily access financial reports they file with the SEC. As my colleague Charlene Harrington and I have pointed out, they were not hurt by COVID in 2020 (“COVID-19 had little financial impact on publicly traded
nursing home companies “J Am Geriatr Soc. 2021;1–4. https://doi.org/10.1111/jgs.17288). We will soon have an article in The International Journal of Healthcare Research regarding the robust financial performance of The Ensign Group since issuing a IPO in 2007.

The late Roy Christensen, founder of both Genesis and The Ensign Group, and his family have become fabulously wealthy by channeling money out of their large chain of facilities into stock options, stock awards, and executive pay. The Ensign Group is rapidly acquiring facilities and undertaking financial maneuvers like spin offs for the purpose of moving property around without incurring capital gains and corporate income taxes. They have also channeled a large share of their hundreds of millions in stock over the years into a variety of family trusts, which keeps their wealth intact and away from the IRS.

House Subcommittee on the Coronavirus Ignores Nursing Home Deaths. That is a Human Rights Violation.

By:

Dave Kingsley

U.S. House Committee Eliminates 141,000 Patient and 2,177 employee Nursing Home Deaths From Reality: Nothing to See There.

According to the Center for Medicare & Medicaid Services (CMS), 141,084 nursing home patients and 2,177 employees have died from the Coronavirus pandemic (https://data.cms.gov/covid-19-nursing-home-data). The House Select Committee on the Coronavirus under the leadership of Congressman James Clyburn – one of the three most powerful Democrats in the House – addressed 249 deaths in meatpacking plants but totally ignored nursing homes.

I have carefully read the Subcommittee’s recently released report More Effective, More Efficient, More Equitable and can find absolutely nothing about the biggest loss of life in an institutionalized population in the history of the United States (see: https://coronavirus.house.gov/news/press-releases/select-subcommittee-s-year-end-staff-report-highlights-oversight-work-releases). Adobe Acrobat PDFs have a search function. Having utilized that function on the report, I can say with certainty that words such as nursing homes, long-term care, skilled nursing, nursing home industry, or any other word that would suggest that elderly and people with disabilities institutionalized in these facilities were of any concern whatsoever to the subcommittee.

How can 141,000 patient and 2,177 employee deaths in one institutionalized population – which constitutes about one percent of the U.S. population in any one year but nearly 20 percent of the COVID-19 deaths since the pandemic appeared in 2020 – be erased from reality? Whose interests are being served by these types of hearings in Congress? Indeed, there has, in fact, been no real serious investigation by the U.S. Congress or any state legislature into the nursing home coronavirus tragedy (at least none that I have found).

The Nursing Home COVID Tragedy Was Avoidable. Therefore, It Is an Atrocity and a Human Rights Violation.

Elderly and disabled Americans were allowed to die because an industry failed to spend the money necessary to save them. The U.S. government has turned over the care of frail and disabled people to an industry well paid to care for them. It is well known and scientifically proven that the industry charged with responsibility for patients in nursing homes has consistently placed shareholder value above medical care. That fact has been demonstrated repeatedly and consistently for the past 70 years that federal and states funds have supported a privatized long-term care and skilled nursing system.

Here are the facts:

Epidemiologists and other scientists renowned in the field of emerging diseases have warned for decades that pandemics like we have experienced in the 2000s would become worse (e.g. See Laurie Garrett, The Coming Plague).

SARS taught the world a lesson about pandemics and the vulnerability of nursing home patients. Hong Kong and other Asian countries took steps to counter future pandemics. The Hong Kong Guidelines were well known throughout the world and yet the U.S. nursing home industry and government regulatory agencies ignored those guidelines while the industry created sophisticated legal and financial structures to drain ever more tax and reimbursement dollars out of the system for the benefit of executives and shareholders (See: https://www.cmaj.ca/content/192/19/ES11; https://www.ncbi.nlm.nih.gov/pmc/articles/PMC7899229; https://www.ncbi.nlm.gov/pmc/articles/PMC723424/; https://www.theguardian.com/world/2020/may/19/mps-hear-why-hong-kong-had-no-covid-19-care-home-deaths.)

Political contributions suggest that the nursing home industry has tremendous sway over congressional and agency oversight. For instance, of the top 100 2019-2020 contributions to Congressman Clyburn – which total over $1 million dollars – approximately half came from corporations and lobbying groups with a vested interest in nursing home finance.

The American Health Care Association – the nursing home corporation lobbying organization – contributed $10,000 to Congressman Clyburn in the 2019-2020 cycle, but it is important to recognize that the nursing home industry is primarily a finance-insurance-real estate as well as a medical industrial complex with interlocking interests between real estate, finance, and medical sectors of the economy. Therefore, consider the following donations to Chairman Clyburn in 2019-2020:

American Healthcare Association (nursing home corporation Lobby): $10,000

National Association of REITs: $10,000

National Bankers Association: $10,000

American Hospital Association: $10,000

National Association of Realtors: $10,000

Johnson & Johnson: $10,000

KMPG: $10,000

Investment Corporation Institute: $10,000

USAA: $10,000

CVS Health: $10,000

Capital Financial: $10,000

Deloitte: $10,000

Abbot Lab: $10,000

Eli Lilly: $10,000

Bank of America: $10,000

Pfizer: $10,000

Pensare Acquisition Group: $10,000

Prudential: $19,000

AFLAC: $34,925

Government & Industry Abuse of An Institutionalized Population is A Human Rights Violation Causing A Massive Number of Fatalities. Government Officials Must Be Held Accountable. But there is No Organized Political Movement to Force that to Happen.

The U.S. government has a long history of looking the other way while widespread abuse and neglect continues pervasively throughout a privatized nursing home system funded with taxpayers’ hard earned dollars. Furthermore, over that 70-year history, an aging enterprise has been spawned by the Older Americans Act and do-gooder contributions to 501C3 organizations. We have Area Agencies on Aging, all sorts of aging-related professional organizations, gerontology professional groups, advocacy groups, the AARP, and countless other special interest organizations have settled into a comfortable relationship with government agencies responsible for regulating nursing homes and the industry itself, which has a high powered PR machine. An ongoing game of rope-a-dope between the industry and advocates over minor tweaks to a system that should be ended not mended takes place ad nauseum, ad infinitum in legislatures across the land.

Nursing home neglect and abuse continues on a regular basis while shareholders and executives get fabulously rich from Medicaid and Medicare funded commercial real estate. It appears, however, that a coalition of so-called senior advocacy organizations cannot mobilize to force congress to take a hard look at the COVID-19 nursing home tragedy that didn’t have to happen.

This Country Simply Does Not Care About Old And Disabled People: We Are Expendable for the Sake of Profit

By:

Dave Kingsley

At Least 150,000 COVID Deaths in Nursing Homes & The House Select Subcommittee on the Coronavirus Crisis Doesn’t Even Bother to Mention It.

On any given day in the United States, approximately 1.5 million Americans will be patients in nursing homes. Throughout the year, 3 million people will either be permanent (long-term) or short-term rehabilitation patients in government-funded, long-term care/skilled nursing facilities. During the past two years, these institutionalized individuals have accounted for at least 150,000 of the 800,000 U.S. COVID deaths. Hence, nearly 20% of COVID fatalities occurred in one institutionalized group comprising less than 1% of the U.S. population.

Yesterday the House Select Select Subcommittee on The Coronavirus Crisis under the leadership of Chairman James Clyburn released a report of the committee’s oversight hearings regarding the COVID pandemic. The report entitled “More Effective More Efficient More Equitable: Overseeing an (sic) Improving and Ongoing Pandemic Response” (https://coronavirus.house.gov/news/press-releases/select-subcommittee-s-year-end-staff-report-highlights-oversight-work-releases) makes no mention that I can find of the largest mass fatality occurring in any institutionalized population in U.S. history. Not even the troops during WWI suffered as large a fatality rate from the flu pandemic as have elderly and disabled patients in U.S. nursing homes during the COVID pandemic.

Lack of the public’s interest in accountability for 150,000+ preventable deaths is a signal to the elderly and disabled that we are not valued as human beings. Politicians are acting like “nothing to see there.” The press, the public, and politicians, are ready to move on like “that didn’t really happen.” “Did it?” The nursing home system is sickening and disgusting as it is. But for a society to seemingly not care much about the failure of a very profitable, taxpayer funded industry to properly care for patients in their charge and agencies like CMS failing to make them care amounts to euthanasia by neglect.

I’m outraged that “aging enterprises” aren’t raising bloody hell about the disaster brought on vulnerable, unprotected, aging and physically challenged people. These organizations claim they represent the elderly, but their silence is deafening:

  • American Geriatrics Society (AGS)
  • American Society on Aging.
  • Leadership Council of Aging Organizations (LCAO)
  • National Association of Area Agencies on Aging (N4A)
  • National Council on Aging.
  • Justice in Aging.
  • Alzheimer’s Association.
  • Senior Medicare Patrol.
  • Administration on Aging.
  • National Center on Elder Abuse.
  • AARP
  • Kansas Advocates for Better Care
  • And Many Others

That the boards of these groups and their paid professional staffs haven’t come together in a coordinated effort to hold accountable a very profitable well-rewarded, industry and the agencies of government they have captured (e.g. CMS, KDADs, etc., etc., etc. …… .) is shameful. Congressman Clyburn and other politicians need to hear from organizations purporting to advocate for the elderly and disabled.

Congresspersons and Senators have certainly heard from the nursing home industry. Congressman Clyburn and Speaker Nancy Pelosi both received $10,000 from the AHCA PAC. Indeed, Democrats are beneficiaries of two-thirds of AHCA PAC money. They don’t need to buy the Republicans – they are on board with whatever corporations want. Any hearing, any report, any statement, from a politician regarding the elderly are of dubious value when the politicians involved are taking money from the industry.

I’m afraid that aging enterprises and paid professionals have fallen comfortably into the good ole boy and girl networks operating inside the Washington, D.C. beltway and all of the state capitols. Speaking truth to power is a risk that might get them marginalized and ousted from the group.

Executive Compensation for CEO’S of Major Nursing Home Chains did not Decline Significantly During 2020: For Most, it Increased by a Significant Amount

    The nursing home lobby operating in Washington and state capitals is continuing its long running financial hardship campaign.  An article in the latest issue of Provider (the main propaganda organ for the industry) claims that COVID presented such a serious financial blow to providers that enhanced financial assistance from government would be the only way to implement needed substantive reform. The reform needed, according to the article, is due to increasing demand in long term care services (Patrick Connole, “COVID Challenges Bring Opportunity for Systemic Changes,” June 2020, 9-10).

    The article states that “With the majority of nursing homes already operating on razor-thin margins, the cost of making improvement will not be possible without financial assistance.”  Perhaps the razor thin margins to which the author is referring apply to the LLC listed as the owner and not to all the other LLCs such as the property LLC, the management LLC, the rehab LLC, the medical transport LLC, etc.  Certainly, holding companies and REITs have not fared badly at all during 2020 and the height of the COVID pandemic.[i]

    One would think that the entities at the top of the financial food chain would have taken a major hit and pared back their CEO pay considerably if the razor thin margins at some point in the flow of capital diminished shareholder value.  However, as the table below suggests, CEO pay for major nursing home operator/real estate chains listed on a public exchange were either enhanced by a large amount over 2019 and 2018 or remained steady.

    The above table does not display the proportion of total pay that is due to an “incentive bonus.”  Nevertheless, in cases where a major increase year over year appears for an executive, a large amount is for performance, which one must assume is financial performance.  The loss of life throughout the companies overseen by the executives in the table was a historical first for institutionalized U.S. populations.  An estimated 132,000 to 140,000 people in the care of these CEOs unnecessarily lost their lives.

    The government funded companies headed by CEOs at issue in this blog post are increasingly powerful players in taxpayer subsidized long-term and skilled nursing. In blog posts ahead, I will be discussing the growth of their power and influence.  For instance, the ManorCare property sold off by the private equity firm The Carlyle Group is now owned by Welltower and operated through a Welltower-Pro-Medica joint venture.

In the future, I will be blogging about the convoluted ownership structures in the nursing home industry and the complexification of that facet of the business due to the creativity of corporate lawyers and financial experts. Without exposing the financial trickery employed by providers, the public will be victimized by falsehoods of lobbying groups such as the AHCA/NCAL and others.

NOTE: The data in this post were derived from proxy statements filed with the Securities & Exchange Commission. In the future, I will be discussing compensation for board members and other officers/executives of major LTC/SKn corporations.


[i] Kingsley DE, Harrington C. COVID-19 had little financial impact on publicly traded nursing home companies. J Am Geriatr Soc. 2021;1–4. https://doi. org/10.1111/jgs.1728

The COVID-Tragedy from the Perspective of A Leader in the Disability Community

Lydia Nunez Landry,

Certified Long-Term Care Ombudsman

disabled disability advocate

Submitted for the United States Committee on Finance record at a hearing on:
A National Tragedy: COVID-19 in the Nation’s Nursing Homes

Wednesday, March 17, 2021

Chairman Wyden, Ranking Member Crapo, and distinguished Members of the Committee,



My name is Lydia Nunez Landry and I am writing to you today not as someone the American Health Care Association and LeadingAge would reduce to the characterization (in their ‘Care for Our Senior’s Act’) of a “frail [or] elderly adult with underlying health conditions” at risk of dying from COVID “630 times higher than an 18 to 29” year old, that is, someone these lobbyists designate as prone to death. Rather, despite reductions of people like me—or any other marginalized group—to underlying health conditions or comorbidities or biased stereotypes, I write to you today as an alive and thriving disabled woman, one who lives in and contributes to her community, and as someone who questions the motives of those who attribute grave injustice toexploited or oppressed people’s own supposed deficiencies. Without a supportive partner to care for me in our home, I could as easily have died from neglect or COVID-19 in the average nursing home. My point here is to show that the long-term care industry is peddling this narrative simply to avoid responsibility for wrongdoing; that is, they want to pretend that people are dying in their facilities not because of the industry’s negligence, greed, or malfeasance, but instead because disabled and older people have a particular tendency to die en masse. The narrative in ‘Care for Our Senior’s Act’ is yet another example of the industry’s connivery and manipulation (I will append a brief example at the end of my testimony to show how they advance this narrative by playing with statistics).

    Generally speaking, when any group of people are marked as suspect or inferior in some manner, when they are segregated and denied the resources and liberties that others enjoy, their flourishing will indeed be impeded, and they will be at a greater risk of contracting infections or disease. This is evidenced throughout history from the decaying and dank tenement houses of the early 19th century, the horrific conditions of the Warsaw ghetto, to the abuses that occurred in state institutions for people with disabilities. Given a deadly pandemic combined with deplorable (or at best unsafe) conditions, where people are segregated and treated as fungible objects from which to extract government benefits (or cheap labor), even AHCA and LeadingAge lobbyists like Mr. Mark Parkinson or Mr. David Gifford might be at a mortality risk 630 times higher than 18 to 29 year olds not forced to endure similar circumstances. (The industry’s claims are rarely supported by evidence, and with brief examination, can be shown inaccurate. Their act is at best slipshod and indicates an arrogance reinforced by years of overindulgence and a lack of accountability.)

    In contrast to those who are key players on K Street or spend most of their time in boardrooms or lobbying in the halls of Congress, I want to emphasize that my perspective is informed by my advocacy work in nursing homes where I have spent a great deal of time. I form bonds with residents. I know many of their spouses and children’s names, where they were from, the hobbies they enjoyed, and the kind of work they did. All of this they generously shared with me. I learned what it was like working in a Pennsylvania textile mill in the 1930s, surviving a chemical plant explosion in Texas and the revolution in Cuba, and growing up in Mexico in the 1940s. I have heard stories from war brides from France and Vietnam or the time a woman had to sew thousands of sequins by hand on her daughter’s quinceanera dress. I feel myself privileged to be granted the opportunity to listen. And unlike CEOs who earn $1,427,192 for lobbying, state ombudsman programs rely on volunteers. I have dedicated my life to this issue and yet rare is the occasion that I am asked to contribute to this topic. I—and other disability justice activists—have not been lavished the same platforms to speak given to long-term care industry CEOs and lobbyists. As a result of this, the voices of significantly disabled people, those at imminent risk of institutionalization or those in institutions, are squelched by the industry narrative. When I initially started out as ombudsman, I applied the principle of charity to the industry’s narrative, but with careful appraisal of the incongruity between what residents, families, ombudsmen, advocates, experts, HHS regulators, CNAs, CMS, and the OIG evidenced compared to the industry’s slant, it became apparent that industry representatives either have a deficient understanding of the culture and operations their business practices engender, or worse, they are impervious to the suffering of disabled people. Choosing not to see injustice or corruption, however, seems contrary to their lofty mission statements and commitments they have made to taxpayers.

On occasion, circumstances force us to confront the ugliness and brutality that inevitably festers where we sequester vulnerable people; stories of abject cruelty rip away the veil of inattention we cultivate to block from our view the relentless mill of everyday abuse, neglect, and hopelessness. In these moments of outrage, we perceive the true nature of institutionalization and perhaps even what we must do, but those flashes of insights quickly fade. Soon those with vested interests haul out the timeworn reform narratives and “bad apple” scapegoats that persuade us to look away again, to participate in systemic neglect from afar. 

As a LTC ombudsman I could not simply look away from the toll of daily abuse and neglect residents experience or ignore their justified feelings of abandonment and the despair it begets. My ombudsman work bears out what ought to have long been obvious to any attentive person, namely, that segregating people in institutions can never foster or indeed ever permit equal treatment.[1] Nor—as over a hundred years of disability history attests[2]—can this model be fixed through reform. We cannot fix that which, by its nature, leads to systemic human rights violations. Severing people (like older and disabled people) from their homes and communities necessarily devalues them as persons and citizens. The diminishment is felt immediately. The freedoms they enjoyed vanish as institutional regiments constrict the courses of their lives. These utilitarian routines deprive them of their privacy and autonomy for the sake of efficiency and cost-effectiveness. Confined in these facilities without the projects and relationships that endowed their lives with meaning and shaped their social identities, they experience a kind of social death.[3] And so too their former communities, continuing on without them, lose the connection to them as full persons still deserving of the moral consideration and respect we are obliged to confer on those people in the community. Isolated, powerless, and dehumanized, people institutionalized inevitably suffer grave harms, not only from abuse and neglect, but from the very act of banishing them from the moral communities that granted the rights and benefits they are now denied.

To be sure, congregate institutions try to simulate community to hide these realities, but such ersatz contrivances are no substitute for genuine social inclusion and belongingness; the simulations are parodies. Such a model cannot produce “person-centered care” no matter how many CMS regulations we enact and enforce. Nor can quarterly congressional hearings and regulatory tweaks—informed by the usual actors they serve to benefit—amount to anything more than theater, political performances that strike those people who must endure the injustice as thoughtless cruelty.

Only a transformative shift in public policy can end these injustices. This shift will require scrutinizing narratives widely considered axiomatic. These include the beliefs that institutionalization is an unavoidable consequence of aging and disability, that institutions provide safer environments (a claim long used to rationalize the barbarity of social removal despite evidence demonstrating the contrary), that uprooting people from the homes, communities, and personal identities they spent lifetimes nurturing is compatible with our most revered social ideals, and finally that we can outsource our humanity—that is, our moral and social obligations to one another, including our disabled parents and children—as a revenue source for corporations and the workers they exploit and expect humane results. 

By now, we know these outcomes of the institutional model; it is a model that objectifies deeply human concerns and favors economic values and imperatives such as competitiveness, efficiency, and profit margins, values that tend to attract predatory actors. And yet we persist with it, and one must ask why. Why do we continue to allow neglect, abuse, and dehumanization to go unchecked? Why do we allow those same predatory actors to manufacture and control the narratives that frame these issues, and indeed provide them platforms in the halls of Congress and in the media to influence unwitting advocates? Why do we persist with this cultivated naivety in the face of so much everyday suffering? The poor human rights records of congregate care facilities long predate the COVID-19 crisis, but the crisis has laid bare the preexisting conditions that led to deaths of over 181,000 disabled people in these institutions.

The horrors I witnessed as an LTC ombudsman keep me up at night, but also inform my disability justice work. And both my insomnia and activism partly derive from frustration. In deference to the industry, the system defangs oversight.  I have fought countless nursing home attempts to involuntarily discharge residents only to have found that those residents, some with severe dementia, had disappeared the following week—to where, the nursing home curiously had (or at least offered) no clue. Sitting at their bedsides, I have held residents’ hands as they recounted instances of rape and abuse, often by staff. Residents have had limbs amputated due to a lack of wound care, understaffing, and poor training. I have seen residents gasp for air as nursing home staff rationed oxygen to save money. I have called Health and Human Services on multiple occasions for residents due to cruel instances of retaliation, only to leave the residents open for more of the same because they sought assistance from a deliberately debilitated regulatory system. Finally, I, myself, have been threatened on multiple occasions by staff and operators. Despite my notifying HHS regulatory and the Ombudsman Program, nothing of substance was done. To the industry, ombudsmen are gnats to swat away; they well know consequences will not be forthcoming. After all, there are few if any consequences for the negligent deaths of residents.

Culture change is impossible within the institutional habitus, particularly so when professional and agency advancement, corporate profit, race, age, and ableism are added to the brew. From the institutional point of view, the dehumanizing model is working as intended. Hence, pumping in ever more money to fund the same solutions and reforms will not bring about different results. As we have seen during the COVID-19 pandemic, nursing homes made record profits from taxpayer funded COVID subsidies, yet COVID cases and deaths, along with non COVID deaths resulting from inadequate infection control practices and severe understaffing, continued to rise.
    

There will be no substantive change until we end the Medicaid institutional bias by diverting taxpayer funds away from institutions and to programs that maintain or reestablish community integration. As I often explain, nursing homes are the most subsidized industry in the United States and increased monetary rewards serve only to entrench industry malfeasance. Diverting Medicaid dollars to fund HCBS not only reaffirms our commitments to the Americans with Disabilities Act (ADA), the Supreme Court’s Olmstead decision, and our professed democratic principles, it will also do more to soften the resolve of a recalcitrant industry (and similar nonprofits) than years of congressional hearings. In the long run, we will waste fewer resources on researching deficient industry practices and developing complex strategies to instigate change (only to be undone by lobbyists), on Office of Inspector General (OIG) and the U.S. General Accounting Office (GAO) investigations, on Ombudsman programs, on regulatory agencies to maintain the illusion of oversight, on healthcare costs resulting from the industry’s negligence, and on subsidizing the industry’s cost of doing business.

Sincerely,

Lydia Nunez Landry

Certified Volunteer Long-Term Care Ombudsman

Organizer for Gulf Coast Adapt

Appendix:

As promised, I want to briefly review a few of the rhetorical and statistical practices employed by the industry and their lobbyists to reframe the human catastrophe exacerbated by the negligent practices in LTC facilities. The author of Care for Our Seniors Act, which aspires to learn from “tragedy” and implement bold solutions, concedes that LTC facilities were the epicenter of the “once-in-a-century” pandemic’s ravage. The force-of-nature language distances the 170,000 deaths (now up to 181,286 deaths) from any culpable agent. And indeed, no one is to blame for the virus, just as we can blame no one for a major flood. But we can blame them for negligent and habitual substandard practices (such as not maintaining levees) that substantially worsen the toll. The author mentions “independent research” by “leading…experts” which shows that “COVID-19 outbreaks in nursing homes are principally driven by the amount of spread in the surrounding community.” The only actual research offered—conducted in May, 2020, long before the vast majority of cases occurred—did conclude that size and location of facilities were factors while traditional metrics such as star ratings and prior citation for poor infection control were not. (Most of the citations were articles from industry magazines, one of which mentioned the article just cited.) It’s unclear how this exonerates the industry. Moreover, the study, thus interpreted, becomes an outlier, as much more research has found direct links between poor quality ratings and significantly higher numbers of COIVD cases and deaths (see here and here).

Instead of dueling studies, we might focus on statistics. The author notes another force of nature behind the deaths, namely time: aging and the fragility of bodies. The virus just happens to target the frail and elderly adults with underlying health concerns that live in their facilities. The author incorrectly asserted that the average age of nursing home residents is 85, but correctly asserted that most residents have underlying conditions, as indeed most people over 65 years old have multiple chronic conditions, in and out of LTC facilities. First some numbers:

The U.S. has approximately 52 million citizens aged 65 or greater. Of them, 430,000 have died from complications of COVID-19 infections. Of those, 130,000 died in nursing homes—the author mentioned 170,000 deaths, but that includes congregate facilities the data from which is sparse, so I shall stick with the 130,000 in nursing homes (NHs). Thus, 300,000 died elsewhere than a NH. NHs warehouse approximately 1.4 million residents, ~ 90% of whom are 65+ years old. The total number of cases in NHs is, at the moment, 643,314, and, for non-NH people in the same age group, 2,666,625. Looking at the bare infection and death numbers, one might think that nursing homes did well—too well, in fact, for the author’s contentions.

But consider again that most people over 65 years old have chronic conditions and most people, even with their bleach wipes, have rudimentary infection controls in their homes. Now, 9.28% of the 1.4 million people in NHs have died from COVID; we can round that up to 1 in every 10. But if non-NH people in the same fragile age group died at that rate, we would have an incredible 4,342,857 more deaths than we do, as only 1 in 167 non-NH elderly people died from COVID. Indeed, examining only those infected, you are nearly twice as likely to die (20% vs. 11%) if you’re in a NH than not. Indeed, the infection rate in NHs is 46% vs. 5.3% for non-NHs fragile people. 

Now, ultimately, industry spokespeople will claim that the deaths occurred because all these people are interacting in close quarters, and so on. But this is not something that can be fixed, and so it underscores why we need to turn back to community integration instead of warehousing people in admitted death traps.


[1] See, for example, Liat Ben-Moshe, Decarcerating Disability: Deinstitutionalization and Prison Abolition (Minneapolis, MN: University of Minnesota Press, 2020).

[2] Sara F. Rose, No Right to Be Idle: the Invention of Disability, 1840s–1930s (Chapel Hill, NC: The University of North Carolina Press, 2017).

[3] Jana Králová, “What Is Social Death?” Contemporary Social Science 10, no. 3 (2015): pp. 235–248, https://doi.org/10.1080/21582041.2015.1114407.

Kansas Legislature Grants Nursing Home Corporations Immunity from Law Suits for Failing to Protect Patients in Their Care

Due to the persistent efforts of LeadingAge, American Health Care Association, and a host of nursing home providers and suppliers, the Kansas legislature passed a bill that protects long-term care providers from law suits for dereliction and negligence during the COVID-19 pandemic. The legislation grants immunity to providers except for “gross negligence” on the part of the staff. Good luck with proving that.

Sympathy expressed for the operators is one of the most disgusting facets of the proponents’ framing of the issues. According to the Kansas City Star, “proponents of the bill argued that nursing homes were not given proper guidance and resources from state agencies at the onset of the pandemic.” Senator Kellie Warren, a Leawood Republican, was quoted as saying, “That we as a state didn’t provide those things but we’re also not going to provide them immunity is an untenable situation for adult care homes” (https://www.kansascity.com/news/politics-government/article250201305.html).

I’ve seen this frame before. The industry is blaming government agencies for not providing them with sufficient training in infectious disease control and for not providing them with personal protective equipment. Providers have been well-reimbursed and investors have extracted excessive funds out of a care system for frail elderly and disabled patients, but they don’t believe they are expected to operate their businesses professionally.

If you follow the press releases on the AHCA/NCAL website, this framing of the issue will sound very familiar. The attitude of the industry is “it’s not our fault, we didn’t know anything about rapidly spreading novel viruses.” Although the long-term care industry has been in the business since 1950, and although it has spawned millionaires and billionaires, operators aren’t capable of taking proper care of people for whom they are paid to be responsible.

I’m wondering what planet I’m living on when I see learned helplessness as an excuse for gross negligence and incompetence. And I say to activists, journalists, and others, please don’t think that the non-profit arm of this business is qualitatively better than the for profits (with the exception of a tiny number of not for profit facilities). The Evangelical Lutheran Good Samaritan chain is the largest non-profit and one of the largest in general. It’s care is as subpar as the low quality for-profits (which is most of them).

LeadingAge: The Non-profit Nursing Home Lobbying Organization is Leading the Charge for Immunity

Rachel Monger, the lobbyist for LeadingAge Kansas, expressed her opposition to an earlier immunity bill in Kansas worked out between Governor Kelly and the legislature. She was of the opinion that the bill did not go far enough in relieving providers of responsibility for neglect and dereliction because “the affirmative defense shield” left providers open to attack. Ms. Monger is of the opinion that the earlier legislation “amount to ‘demoralizing punishment.”

I’ve seen Ms. Monger in action several times at legislative hearings. For instance, I observed her argument against stiffer regulation of psychotropics. She claimed that the providers had a profit margin of a half percent. In corporate speak, this sounds like child babble, but she was waving the Clifton, Larsen, Allen (CLA) annual report around, which is bogus. I look at these industry propaganda pieces every year.

What are Nursing Homes? What Are Operators Expected to Know?

The attitude of the industry is this: “We’re running medical facilities full of medically vulnerable patients, but we can’t be expected to know much about infectious diseases.” In other words, their business is protecting and enhancing shareholder value – not reinvesting earnings in innovative and higher quality, medically ethical, professional care. It’s about the money. If they say, “it’s not about the money,” it’s about the money. Warehousing people at the lowest possible cost is their mode of running their institutions.

I have been warning and will continue warning ad nauseum, ad infinitum, that by letting the industry off the hook for the 300,000 preventable deaths, the lives of medically fragile people in nursing homes will be seriously endangered. If operators and their corporate holding companies can get away with their negligence of the past year, the message will be this: the lives of people in your care aren’t that valuable, so cut costs, warehouse patients, and extract as much cash as possible out of the system.