Gray Panthers’ Statement on the American Nursing Home System: “Restructure the Industry and Defund the Existing System.”


Dave Kingsley

Reissuing an Important & Elegantly Written Document by the National Council of Gray Panthers Networks.

    A couple of years ago, the Gray Panthers issued a statement on the nursing home industry in the United States.  Entitled “Restructure the Industry and Defund the Existing System,” it was elegantly written and to the point of what we need in public discourse regarding the suffering of institutionalized disabled and elderly Americans in long-term care – suffering due to the precedence of shareholder value over humane care.  Hence, the document is well worth reading today since recognized reform movements in Washington, D.C. over the past couple of years have been sympathetic to the industry and unwilling to confront the truth.

    The authors were too modest to take credit and list their names on the statement.  I assume that Jan Bendor, Art Persyko, Lydia Nunez, and Clint Smith had a hand in writing it.  But perhaps it involved more members or perhaps all of the GP Senior Housing Committee.

    The following are excerpts from the summary:

    “The ‘enemy’ is a monster created by federal policy, allowing for-profit corporations to own chains of long-term care facilities, and lavishing on the owners the incentives and benefits in our tax laws regardless of their performance in caregiving.”

    “These corporations are engaged in buying and selling of real estate with very favorable tax rewards.  The corporations can practice medicine and also profit from Medicare, Medicaid, and other programs that can be hijacked for the corporation’s benefit rather than for the benefit of those in their care.”

Problems & Recommendations

    In stating the problems on page 2, focus of the statement was on lack of accountability for the massive loss of life due to COVID, weak regulation by government agencies, underpaid staff in understaffed facilities, and the political clout of the industry through lobbying.  Recommendation appropriately included accounting of Medicare length of stay fraud, wrongful discharges that occur, accountability for misreporting of data regarding harm and finances, overuse of antipsychotics.

   Download the Gray Panther Statement on Nursing Homes Here:

If the U.S. Moved in the Direction the Gray Panthers are Suggesting, Americans May Not Hate the Thought of Needing Long-Term Care in a “Nursing Home.”

Inside the Washington, D.C. beltway reform efforts are beset with influence from the powerful forces that have a vested interest in keep the nursing home system the way it is. It is time for some honest discussion about why the status quo is only gaining strength with a small tweak here and there that serve as appearances and nothing more.


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 (, 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.

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

Senators Want to Give the Senior Housing Industry More COVID Relief Money. Fight It! It’s A Rip Off for Investors and Executives!

Senators’ Letter Is Not About the Quality of Senior Living:  It is About the Power of Finance, Insurance, & Real Estate

The senior housing industry lobby has convinced 20 U.S. Senators to sign onto a letter to HHS Secretary Becerra asking him to direct more of the $23 billion left from the CARES Act into corporations that, in my opinion, haven’t demonstrated a need for more financial assistance.  According to trade publication McKnight’s Senior Living, two powerful lobbying organizations, American Seniors Housing Association (ASHA) and Argentum have been pressuring legislators to persuade the HHS Secretary to direct more government largesse into corporations such as Ventas, Welltower, and Sunrise – all of which have already benefited nicely from a plethora COVID-19 relief programs (Bipartisan group of 25 senators supports additional COVID aid for senior living – News – McKnight’s Senior Living (

Advocates and activists should do everything possible to stop any immediate injection of more federal dollars into an industry that has provided no empirical evidence that it has suffered financially because of the COVID-19 pandemic. Nor has the senior housing industry demonstrated that much of federal and state dollars channeled into senior housing corporations significantly improved care, wages, and working conditions.

The power of the lobby pushing for more government relief is immense.  The special interests pressuring senators and house members comprise a juggernaut of finance, insurance, and real estate – otherwise known as FIRE or Wall Street.  A massive river of money flows into campaigns and lobbying resources from real estate investment trusts, private equity firms, health care corporations, institutional investors, and other special interest groups acting on behalf of shareholders and executives.

Senior Housing Corporations Are Horizontally Integrated

According to the McKnight’s article, senior housing trade groups are claiming that all COVID assistance has been totally devoted to the skilled nursing (“nursing home”) segment of the industry.  That is false for a couple of reasons: (1) senior housing is dominated by large real estate investment trusts owning and operating the gamut of living/care spaces such as continuing care retirement communities (CCRCs), assisted living, and skilled nursing, and (2) Although the “nursing home” segment of the industry received a wider range of relief funds than most other types of corporations, direct grants and tax deferrals were available to all companies in senior living. 

Companies such as Sunrise Senior Living, Brookdale Senior Living, Sabra, Omega, Welltower, and Ventas are intertwined in a massive real estate industry with the objective of protecting and enhancing shareholder value.  My ongoing review of financial reports of publicly listed corporations involved in senior housing indicates that COVID did not present the same crisis for it that other industries incurred. Revenue, earnings, cash flow, and liquidity in general was in good shape for every public corporation with a wide array of senior housing services.

More detail pertaining to the finances of senior housing corporations will be provided on this blog in the days ahead.  As I locate and organize publicly available financial data of REITs and their operators, it is becoming increasingly clear that the senior housing industry is manipulating public opinion by providing misleading information about the impact of COVID on their financial performance.  The American Health Care/National Assisted Living Association (AHCA/NCAL), ASHA, Argentum, and other special interest groups in real estate and finance have been playing the public and legislators by claiming hardship while hiding the truth about how well they did in 2020.

If COVID Was So Financially Harmful to Senior Housing Corporations, Why Have Executives Been So Well Rewarded?

Former Welltower CEO Thomas DeRosa left the company last October with a 2020 compensation package of $14,589,584 (  Shankh Mitra, his replacement, received a total compensation package of $9,557,434. DeRosa’s 2019 compensation totaled $13,142,124; Mitra’s totaled $5,728, 143 in 2019 – quite nice increases for a company needing federal assistance (

Four of the five Welltower board members were paid from $300,000 to $352,000 (the lowest paid BOD member made $275,000).  In its 2020 10-K report, Welltower stated that its primary objective is to “protect and enhance shareholder value.”  Compensation packages for the board and officers indicate that the primary objective of the corporation was achieved in 2020, so why is more government assistance needed?

As proxy statements are released by major corporations in senior housing, it is becoming clear that CEOs were generously rewarded by their boards in 2020.  For instance, Ventas CEO Debra Cafaro’s compensation increased from $11,348,335 in 2019 to $12,628,714.  Ventas Executive VP and CFO’s compensation package took an amazing jump from $4,833,831 in 2019 to $13,116,202 in 2020! In the next few days, I will be highlighting the generous compensation packages received by CEOs that failed to protect hundreds of thousands of citizens in their care.  Executive compensation packages I’ve seen so far suggest that “incentive pay” is a sham concocted between executives and their boards.

Advocates & Activists:  Please Head Off Another Senior Housing Money Grab.

Any senior housing advocacy and/or activist group worth it’s salt should be all over this Wall Street money grab – aided and abetted by U.S. Senators.  Here is a list of the 20 Senators who have signed onto the letter (initiated by Senators Collins and Sinema):  Senators signing the letter in addition to Sinema and Collins include Michael Bennet (D-CO), Marsha Blackburn (R-TN), Tom Carper (D-DE), Bill Cassidy (R-LA), Chris Coons (D-DE), John Cornyn (R-TX), Kevin Cramer (R-ND), Steve Daines (R-MT), Dianne Feinstein (D-CA), Deb Fischer (R-NE), Bill Hagerty (R-TN), Mark Kelly (D-AZ), James Lankford (R-OK), Roger Marshall (R-KS), Jerry Moran (R-KS), Alex Padilla (D-CA), Tim Scott (R-SC), Tina Smith (D-MN), Jon Tester (D-MT), Thom Tillis (R-NC), Chris Van Hollen (D-MD), Todd Young (R-IN) and Amy Klobuchar (D-MN).

ASHA and Argentum are encouraging support of a similar letter in the House written by Reps. Abigail Spanberger (D-VA) and Anthony Gonzalez (R-OH). That letter is expected to close by week’s end.

My suggestion is that advocates and activists across the country come together and draft a letter to the HHS Secretary in which they insist that the finances of the senior housing industry be reviewed before any further COVID relief funding is made available to corporations providing assisted living, independent living, and skilled nursing.  Many of these companies are closely held and will not disclose their consolidated income, balance sheet, and cash flow statements.  Until they are willing to do that, the public should rebel against large injections of public funds into the senior housing industry.

Also, it is important to contact the senators on the above list and let them know that their support of more taxpayer funds that will most certainly reward investors and executives will prove embarrassing. As an increasing amount of 2020 financial data is discovered, organized, and reported, it is becoming clear that the American people are being played by an industry receiving undeserved subsidies. This is not about capitalism or the legitimate role of government.  Rather, it is about a corrupt political process and senior housing system that we ignore at our peril.