Are Profits Gaining Ground Over Nursing Home Patient Care?

Elderly care is a complex and a delicate issue. We are dealing with one of the most vulnerable sections of the population ­some would argue than even more so than children. So how are non- and for-profit facilities dealing with mounting costs and infamous mishaps, ranging from filthy conditions to negligent deaths?

There is need for 24/7 specialized attention, which can become quite expensive, depending on the extent of every individual requirement. For-profit nursing homes claim to deal with scant resources, with many stating meager or non-existent earnings. This allegation has been used to explain chronic staff shortage, among other shortcomings.

Then why do investors buy these facilities if they are so unprofitable? Medicare and Medicaid funds channeled into nursing homes have been increasingly redirected towards multi-million expenses, and most of the time, the recipients of these expenditures are subsidiaries of the same corporation running the centers. A home may “lose” money in one area, but compensate in clever ways. Guardian Elder Care, a private nursing home chain based in western Pennsylvania, reported an average of $80,000 profit per center in 2016, while spending $1.4 million on goods and services, channeled through their own partner enterprises, such as medicine suppliers and therapy providers. Data from a study developed by the University of Rochester reveals that, for example, costly “ultrahigh intensity” rehabilitation programs have been steadily on the rise for terminal patients, who end up in an uncomfortable situation at the end of their lives, while bills pile up for centers to collect.

Nevertheless, low income is not always the case. Research conducted by the University of Illinois at Chicago highlighted an increase in for-profit nursing home earnings, with quality of service diminishing simultaneously. The researchers, who were led by Lee Friedman of UIC’s School of Public Health, concluded that “patients receiving care in for-profit institutions were diagnosed with substantially more clinical signs of neglect than patients residing in not-for-profit facilities”. This trend appears to be worsening over time, raising concerns within officials and organizations in charge of regulating elderly care services.

There is a case for alarm, and suggestions to break this cycle within nursing homes range from implementing better financial controls in order to check how money is spent, to expanding requirements, tougher punishments and more rigorous scrutiny when it comes to giving out licenses.