Of Course They Did

Frontline nursing home workers are incredible human beings.

But to put it less politely than I did in April, the long-term care industry is dominated by a pack of absolute scoundrels who view it as a piggy bank, socking away huge profits by understaffing nursing homes and paying poverty wages to caregivers.

COVID-19 hasn’t changed this — and it may have made it worse. An investigation by The Washington Post has revealed that dozens of nursing home chains who were previously accused by the government of various Medicare fraud schemes, labor abuses, and patient care problems (usually resulting in settlements against the homes and agreements for increased government oversight) have cashed in on hundreds of millions of dollars in CARES Act funding with astonishingly few strings attached:

Agreements between the providers and HHS include language prohibiting nursing homes from using the federal money for abortions, gun-control lobbying and the purchase of chimpanzees, but do not require homes to spend on such things as personal protective equipment or hazard pay for nurses and aides caring for covid-19 patients.

The Post found at least two publicly-traded nursing home chains that have continued to pay shareholder dividends during the pandemic; I suspect there are many more, in addition to whatever profit-squeezing manuevers the opqaue private equity firms in the long-term care industry have cooked up over the last few months.

Adding to the boon, nursing homes were allowed to more easily “convert existing, long-term-care patients on Medicaid to higher-paying Medicare as long as the homes determined the residents needed skilled care under CMS guidelines” which one policy expert at Harvard called “a huge revenue bump” that would allow them to quadruple their revenue from these residents.

“It goes back to this issue of whether or not there were shortfalls,” Grabowksi said. “You would want them to be able to make payroll, to buy all the supplies. … But I think there are a lot of concerns, especially with private equity and others, are you making the payments to a private-equity group or are you paying your staff? Greater accountability here on the financial side would be a good thing.”

And then of course there are the “related-entity” transactions, which pre-pandemic were often already a source of nursing home financial malfeasance: a closely-related business (owned by the same corporate parent, or in the case of smaller independent nursing homes, by an actual family member) becomes a vendor to the nursing home in order to sell it a good or service.

Some providers have affiliated entities, such as medical supply companies, that could charge related nursing homes above-market rates for goods and services to justify expenses.

“There are owners in the industry who have related parties,” said Wasserman, the California doctor and industry representative. “Now the facility is paying five to 10 times the amount for PPE. That is not how Cares Act money should be spent.”

This lack of oversight to the industry’s response has surely contributed to the countless nursing home residents and front-line caregivers who have gotten sick or died during the pandemic. Maria José Correia, a Rhode Island nursing home worker who contracted COVID-19 recently spoke to The Boston Globe about her experience:

In the pandemic, I was doing more than three jobs because of people calling out. We are short in CNAs, and we are short in the kitchen, we are short in the porter. If I see they need me, I help. …Because I did more than my job, I had more opportunities to get sick. I was fast to get this. They tell me ‘you shouldn’t do that,’ but when you are short and people call out, because they are sick … you have to stay.

I’m positive I got it from my job. I blame myself. If I see you need my help, I’m going to help. I was feeding people, washing people, helping everybody who needs help. Why? It’s because you need help. I gave them a bath …. After I got sick, they died. It was a person I loved.

Maria suffered a stroke due to COVID-19, losing half of her vision and part of her mobility. She is determined to complete her course of therapy and go back to work caring for her residents.

The nursing home chain she works for, Genesis HealthCare, is one of the largest chains in the country, with over 400 skilled nursing facilities in 25 states. According to The Washington Post’s reporting, Genesis received approximately $180 million in pandemic payments from the federal government and another $27 million from state governments.

As the suffering and death continues to compound, it looks like the profits are too.