The nursing home industry is changing in dramatic ways, as for-profit companies take over increasing numbers of facilities across the country. The change matters because studies consistently show that for-profit nursing facilities have the lowest staffing levels and more quality problems (higher rates of deficiencies) than non-profit and government-operated facilities. As Harvard professor David Grabowski told CBS News in June, “‘The vast majority of quality problems in the U.S. are centered in for-profit nursing homes.” Moreover, the poor showings are more pronounced in for-profit facilities that are owned by chains.
The change in ownership also mirrors increasingly complicated ownership structures that make it difficult to track how facilities spend the Medicare and Medicaid reimbursement they receive. In “For-profit groups have vacuumed up over 70% of America’s nursing homes, and health advocates are worried: ‘The care gets really bad,’” KFF Health News reports a related troubling trend. For-profit owners are taking over facilities that had been operated for decades by faith-based organizations – facilities that usually have higher staffing levels and provide better care.
The trade press documents these transitions in daily articles. Reviewing federal data on data.CMS.gov (which reports information about staffing and quality for nursing facilities with common ownership and affiliation) with nursing home chains recently featured in Skilled Nursing News documents the troubling pattern:
“Ensign Breaks Into New Local Market in Arizona, Deepens Footprint in Colorado” (Jun. 4, 2024). Skilled Nursing News reports that the Ensign Group added two facilities, bringing the company’s total to 312 skilled nursing facilities in 14 states. McKnight’s Long-Term Care News reported in “Ensign Group goes on buying spree as it reports yet another record quarter” (May 2, 2024), that Ensign had acquired 13 facilities in the first quarter of 2024, bringing its total to 310. Data.CMS.gov reports that The Ensign Group’s 266 nursing facilities in 14 states have, on average, below average staffing levels (2.5 stars on a 5-point scale) and 320 federal fines totaling $6,213,221.46 and averaging $23,357.98 per facility. (Note: data.CMS.gov reports data on only 266 of Ensign’s 312 facilities.) “NHC Acquires 15 Skilled Nursing Facilities; Ignite Medical Resorts Expands in Indiana” (Jun. 5, 2024). Data.CMS.gov reports that Ignite Medical Resorts, affiliated entity #279, has 17 facilities in seven states. On average, the 17 facilities have an overall 5-star rating of 2.9 stars, an average health inspection rating of 2.7 stars, and an average staffing rating of 2.2 stars, all below-average ratings. The 17 facilities have 19 federal fines, totaling $726,796.02 and averaging $42,752.71 per facility.
June 13, T. Edelman