In 2014, the Ostego County-owned nursing facility, Ostego Manor, was losing $5-6 million a year and was sold, “despite strong local opposition,” to the Focus Family of Companies for $18.5 million.[1] Focus renamed the New York State facility Focus Rehabilitation and Nursing Center.
The Daily Star reported that Focus’ owners cut staff from 298 to 225, care problems soared, and in 2016, the facility was designated one of the worst in the state and fined $18,000.[2]
In December 2016, the Centers for Medicare & Medicaid Services placed Focus Otsego on the Special Focus Facility list,[3] a designation now identifying approximately 88 facilities in the country with a record of extremely poor care over multiple years.
In May 2018, the New York State Attorney General filed criminal charges against the entity that held the facility license, the 99% owner of the facility, and the owner’s business partner, charging them with felonies and misdemeanors for endangering residents and neglect.[4]
In September 2018, the corporation pleaded guilty to a felony and both the owner and manager pleaded guilty to misdemeanor endangerment and were voluntarily excluded from Medicaid and from operating health care businesses in New York State for five years.[5] As described in the Attorney General’s Press Release, the state’s investigation found that the owner and director “cut staff payroll and other necessary services and supplies needed to provide safe and adequate care and sufficient staffing levels to the approximately 174 residents” from October 2014 through December 2017.[6] As described by the Attorney General, Administrators and Directors of Nursing told the owner that staffing levels were low “and that supervisors could not find sufficient numbers of willing staff to work shifts due to pay cuts and double-shift requirements imposed by defendants.”[7] Over a 41-hour period, from 1:00 p.m. May 28, 2016 until 6:30 a.m. May 30, 2016, staff left a 94-year old resident in a recliner “and failed to provide timely, consistent, safe, adequate, and appropriate services, treatment, and care.”[8]
The owner sold the facility to Centers Health Care, “the largest post-acute health care continuum in the Northeast, with 42 nursing and rehab facilities across New York, New Jersey and Rhode Island,”[9] The facility was renamed Cooperstown Center for Rehabilitation and Nursing.
In January 2021, New York State Attorney General Letitia James described the Focus facility in an Appendix to her nursing home report as illustrating “the too prevalent ‘low staffing for profit’ model of exploitation through insufficient staffing, lack of transparency, and financial incentives.”[10] The Attorney General reports that in the three-year period between October 2014 and December 2017, the facility diverted payments to the owner and related parties totaling more than $14 million.
Cooperstown Center for Rehabilitation and Nursing is a plaintiff in a nursing home lawsuit, filed in December 2021, challenging the New York State law requiring nursing facilities to spend 70% of their revenues on care (including 40% on “resident-facing staff”) and limiting their profits to 5%.[11] The facility alleges that if the new State law had been in effect in 2019, it would have had to remit $764,192 to the State for failure to comply with the new transparency and accountability provisions.[12]
As of February 1, 2022, Cooperstown Center for Rehabilitation and Nursing has an overall rating of one star on the federal website Care Compare, the lowest rating on a five-point scale. The federal website reports that the facility has not had any civil money penalties imposed in the prior three years.
This facility illustrates what is happening in the nursing home industry.
- County-owned facilities are being privatized and sold to private for-profit owners.[13]
- Related party transactions are taking money out of facilities that should be spent on care for residents.
- Sales of facilities frequently involve a change of name, making it difficult for the public to trace a facility’s history.
- Large corporate owners are buying nursing facilities.
- The Special Focus Facility program has not been effective in bringing about sustained improvement in facilities providing exceptionally poor care.
- The enforcement system is overly tolerant of poor care; facilities with the lowest ratings (one-star on Care Compare) are not sanctioned with financial penalties.
- New York facilities that are suing the state calculate that they would have had to remit hundreds of millions of dollars under a new state law requiring transparency and accountability.
A 2018 Editorial in the Cooperstown Crier described Focus Otsego as “a sad song that goes on and on.”[14] Unfortunately, the sad story continues to this day for residents.
February 10, 2022 – T. Edelman
[1] Erin Jerome, “Ex-Otsego Manor nursing home gets new owner,” The Daily Star (Jan. 25, 2019), https://www.thedailystar.com/news/local_news/ex-otsego-manor-nursing-home-gets-new-owner/article_6c84fadc-2664-5c7b-a1b5-833a8f63d1ae.html
[2] Id.
[3] Denise Richardson, “Feds place Focus Otsego on probation,” The Daily Star (Jan. 9, 2017), https://www.coopercrier.com/news/local_news/feds-place-focus-otsego-on-probation/article_b6b2a805-68bc-5ea9-ad89-2ee529d7db1e.html
[4] New York State Office of the Attorney General Letitia James, Nursing Home Response to COVID-19 Pandemic, Appendix B, p. 65, ‘ Anthony Borrelli, “Former Otsego County nursing home owner, manager face endangering charges,” Press Connects (Jun. 12, 2018), https://www.pressconnects.com/story/news/public-safety/2018/06/12/otsego-focus-rehabilitation-nursing-center-charges-neglect/694427002/
[5] New York State Attorney General, “A.G. Underwood Announces Guilty Pleas Of Former Focus Otsego Nursing Home Operators For Endangering Resident” (Press Release, Sep. 12, 2018), https://ag.ny.gov/press-release/2018/ag-underwood-announces-guilty-pleas-former-focus-otsego-nursing-home-operators
[6] Id.
[7] Id.
[8] Id.
[9] Erin Jerome, “Ex-Otsego Manor nursing home gets new owner,” The Daily Star (Jan. 25, 2019), https://www.thedailystar.com/news/local_news/ex-otsego-manor-nursing-home-gets-new-owner/article_6c84fadc-2664-5c7b-a1b5-833a8f63d1ae.html
[10] New York State Office of the Attorney General Letitia James, Nursing Home Response to COVID-19 Pandemic, Appendix B, p. 63, https://ag.ny.gov/sites/default/files/2021-nursinghomesreport.pdf
[11] The Complaint is available at https://medicareadvocacy.org/wp-content/uploads/2022/01/Nursing-homes-NY-nh-case-21-cv-1384-BKS-CFH-complaint-U.S.-District-Court-NYND-2.pdf
[12] Id. ¶167.
[13] CMA, Privatization of County-Owned Nursing Facilities is Not Good for Residents, Staff, or States (CMA Report, Oct. 25, 2021), https://medicareadvocacy.org/wp-content/uploads/2021/10/CMA-Report-SNF-Privatization-10-2022.pdf
[14] “In Our Opinion: Focus Otsego is a sad story that goes on and on,” Cooperstown Crier (Jun. 21, 2018), https://www.coopercrier.com/opinion/in-our-opinion-focus-otsego-is-a-sad-story-that-goes-on-and-on/article_4577702b-4481-5a51-b7c7-e722edb1399f.html