Recent analyses of private equity firms find that facilities taken over by private equity firms provide poorer care to residents and have lower nurse staffing levels, while admitting more residents and increasing their lengths of stay. As a consequence of these practices, it is not surprising that recent studies document that nursing facilities owned by private equity firms have higher rates of COVID-19 infections and deaths than facilities with other ownership patterns.
The Portopiccolo Group, as described in Barron’s, is a private equity firm started in 2016 that now operates 100 facilities under various names, such as Accordius, Pelican Health, and Orchid Cove. At least 10% of Portopiccolo-affiliated facilities have been cited with infection control deficiencies during targeted infection control surveys conducted since March 2020, more than three times the rate of nursing facilities nationwide.
Barron’s describes COVID-19 rates in several Portopiccolo facilities. Accordius acquired Citadel Salisbury, a North Carolina nursing facility with 160 beds, in 2020. The facility had the largest COVID-19 outbreak in the state – 168 COVID cases among residents and staff, including 18 deaths. Mills Nursing and Rehabilitation, a Kentucky nursing facility with 98 beds, has had 107 COVID-19 cases among residents and staff and 23 deaths.
Barron’s reports that among the 75 facilities listing Portopiccolo’s CEO as an owner in federal regulatory data, 43% have one star, the lowest rating, compared to 17% of facilities nationwide. Only three of the 75 facilities “exceed the national average total nurse staffing of 3.86 hours per resident day.”
An analysis of COVID-19 in New Jersey nursing facilities by the Americans for Financial Reform Education Fund finds that while facilities operated by private equity firms account for 15% of the state’s nursing facilities, they account for 20% of the coronavirus cases and deaths. 58.8% of residents in facilities owned by private equity firms contracted COVID-19, 24.5% higher than the statewide average.
Private equity facilities in New Jersey provide 20% fewer hours of nursing care per resident per day and are cited with more deficiencies than nonprofit and public facilities.
The Americans for Financial Reform Education Fund recommends that
- “Private equity be prohibited from owning health care facilities and assets like nursing homes.”
- “The federal government must require the disclosure of the ultimate corporate owners and operators of federally certified nursing homes.”
- “The federal government should impose strict staffing standards to protect workers and residents.”
Similar recommendations for better, more explicit staffing standards and for more effective enforcement have been made before. The COVID-19 pandemic has made these recommendations more important than ever.
Aug. 13, 2020
 Atul Gupta, Sabrina T. Howell, Constantine Yannelis, and Abhinav Gupta, “Does Private Equity Investment in Healthcare Benefit Patients? Evidence from Nursing Homes?” (Feb. 2020) full report available through https://papers.ssrn.com/sol3/papers.cfm?abstract_id=3537612; Eleanor Laise, “Private-equity takeover of nursing homes has reduced quality of care at critical moment, research suggests; for-profit ownership and private-equity backing of nursing homes, academic studies show, may weaken facilities’ staffing levels and compliance with federal standards,” MarketWatch (Mar. 14, 2020), https://www.marketwatch.com/story/coronavirus-pandemic-puts-private-equity-ownership-of-nursing-homes-under-microscope-2020-03-14?adobe_mc=MCMID%3D27544074148082056223030259368856516599%7CMCORGID%3DCB68E4BA55144CAA0A4C98A5%2540AdobeOrg%7CTS%3D1596726240; Americans for Financial Reform Education Fund, “The Deadly Combination of Private Equity and Nursing Homes During a Pandemic; New Jersey Case Study of Coronavirus at Private Equity Nursing Homes” (Aug. 2020), https://ourfinancialsecurity.org/wp-content/uploads/2020/08/AFREF-NJ-Private-Equity-Nursing-Homes-Covid.pdf.
 Eleanor Laise, “As the Pandemic Struck, a Private-Equity Firm Went on a Nursing –Home Buying Spree,” Barron’s (Aug. 6, 2020), https://www.barrons.com/articles/as-the-pandemic-struck-a-private-equity-firm-went-on-a-nursing-home-buying-spree-51596723053?mod=hp_DAY_Theme_1_1.
 Americans for Financial Reform Education Fund, “The Deadly Combination of Private Equity and Nursing Homes During a Pandemic; New Jersey Case Study of Coronavirus at Private Equity Nursing Homes” (Aug. 2020), https://ourfinancialsecurity.org/wp-content/uploads/2020/08/AFREF-NJ-Private-Equity-Nursing-Homes-Covid.pdf.
 Rohit Pradhan, Robert Weech-Maldonado, Jeffrey S. Harman, Mona Al-Amin, Kathryn Hyer, “Private Equity Ownership of Nursing Homes: Implications for Quality” (Jun./Jul. 2014), full text available at https://healthfinancejournal.com/index.php/johcf/article/view/12#:~:text=Despite%20wide%2Dspread%20public%20concern,remains%20limited%20%3B%20ergo%20this%20study.&text=Private%20equity%20nursing%20homes%20have,compared%20to%20the%20control%20group, discussed in CMA, “Nursing Facilities Owned by Private Equity Firms: Fewer Nurses, More Deficiencies” (CMA Alert, Aug. 20, 2014), https://medicareadvocacy.org/nursing-facilities-owned-by-private-equity-firms-fewer-nurses-more-deficiencies/.