Chain Nursing Homes Quest for Profits Tarnishes Long-Term Care Field

Chain Nursing Homes Quest for
Profits Tarnishes Long-Term Care Field

It’s abundantly clear that nursing homes ought to be operated for the “public good” and not as institutions owned by investors seeking a return on their investment.

For those for whom that’s not been clear, one need only read last week’s New York Times front page expose′ on how private investor-owned nursing homes cut costs and staff in order to seek more profit.

In their quest for money – and certainly not in search of the best in care – The Times reports that the “typical large chain owned by an investment company in 2005 earned $1,700 a resident. The report went on to say that these homes, on average, are “41 percent more profitable than the average facility.” They also fare considerably worse in inspections by state surveyors, according to the report.

Unfortunately, The Times article, while revealing, has had the effect – from discussions I’ve had with acquaintances, community residents and business people in the community – of casting a stain on all nursing homes.

That’s too bad.

Chain nursing homes, by the way, are not allowed in New York State, although for-profit homes are permissible.

The Times story underscores an important reminder for those seeking quality care and compassion in a nursing home. That message is that sponsorship matters.

Slightly more than half of New York’s nursing home’s are operated under the auspices of not-for-profit entities, who share a mission of service to the community, not a debt to investors. Not-for-profit nursing homes “investors,” actually, are the members of the communities where they are located, and the organizations that operate skilled nursing facilities are dedicated to serving the needs of those community residents.

Not-profit-nursing homes are not centers of high profit, with most relying on governmental programs such as Medicaid and Medicare to provide reimbursement that often doesn’t cover the cost of quality care efforts and the staffing needed for them. As a result, operating margins are thin, extraordinarily so, if they exist at all. Medicaid, for example, covers only from 70 to 85 percent of the actual costs of care.

Scott Amrhein, who directs the Continuing Care Leadership Association, points out that as a result being accountable to their boards and communities, not-for-profit homes have “fewer adverse events, fewer regulatory violations and, most importantly, better quality performance.”

Across New York, there are nursing homes that adhere to the same principles of care espoused by our own not-for-profit Village Nursing Home – core beliefs that seek to set higher standards of care, provide more hours of care and greater services. We’re required to reinvest whatever money that is made back into programs, not return it to private investors. But even without that requirement, it’s not-for-profit nursing homes that are at the center of innovation and new ideas that explore ways to improve the lives of persons needing long-term care.

Not-for-profit organizations that sponsor nursing homes have for some time been pursuing ventures that are transforming the way care is provided for seniors – both bringing dramatic changes to nursing home environments and staff interactions with residents, and developing new and expanded community services with the goal of delaying, if not preventing, nursing home admissions.

You may have read about the changes that Village Care of New York has underway in what we call SeniorChoices, our array of programs and services for older adults. We will in 2009 replace Village Nursing Home with a new Center for Rehabilitation and Nursing that will emphasize short-stay rehabilitation and end-of-life and palliative care. The Center will have plenty of open space and will include private rooms in a neighborhood concept. More importantly, we’re expanding our community offerings as well as adding new ones so that we can serve more nursing home-eligible people in non-institutional settings.

Village Care and other not-for-profit organizations are where changes in long-term care are being pursued, concentrating on opening up and expanding opportunities for community-based and at-home care so that quite possibly people can have the opportunity to live at home, or other community setting, until the day they die.

We see our mission as serving the public good.

That’s how all nursing homes should see their mission.