Strong Profits but Poor Quality of Care at Nation's Largest Nursing Home Chains

April 16, 2012

Illinois nursing home lawyers at the Law Firm of Pintas & Mullins understand the decision to place a loved one in nursing home care is quite difficult. Families of elderly nursing home residents must trust that the nursing facility will provide essential services and adequate supervision. Unfortunately, some of the nation's largest for-profit nursing homes are still being cited with a high number of deficiencies related to resident neglect and abuse.

According to a recent release by the consumer group Families for Better Care, financial motivations explain some of the problems that seriously impact the health and well-being of vulnerable residents. In an effort to increase profits, many of the nation's leading nursing home chains are cutting back on labor costs. As a result, fewer skilled nursing personnel are available to assist residents with food and medication needs, or provide them with critical services such as bed sore prevention.

From a purely cost-savings standpoint, this strategy is effective. Year-end earnings statements show that several large, publicly-traded nursing homes experienced significant revenue spikes in 2011. Kindred Health Care reported an "exceptional" year, with operating revenues increasing from $4.4 to $5.5 billion. Annual revenues at AdCare jumped 200% to a record total of $151.4 million. And the Ensign Group nursing home chain reported "better than expected" operating results.

Several analysts predicted that the nursing home market would be negatively impacted by recent Medicare cuts that averaged about 11 percent. One study estimates that as many as 80 percent of nursing home residents rely on Medicare or Medicaid to provide for their nursing home care. Accordingly, adjusted Medicare reimbursement rates were expected to hurt the overall financial health of the nursing industry in 2011. Surprisingly, the balance sheets of many for-profit nursing homes reveal a far different reality. Nursing homes continue to thrive, and some facilities are even enjoying record revenue totals.

These figures suggest that deep staff cuts likely offset adjusted reimbursement rates, allowing nursing facilities to maintain a strong bottom line. Sadly, quality resident care is the only area on the decline. Studies show that inadequate staffing levels typically lead to higher deficiency rates. According to the journal Health Services Research, nursing homes with lower nurse staffing hours have the sickest residents. Some common deficiencies that residents typically suffer from include weight loss, falls, and serious mistreatment or neglect.

It is unacceptable to our Illinois nursing home negligence attorneys that far too many nursing home chains continue to emphasize profits over quality care. Some of the most serious safety violations are happening at the largest for-profit nursing facilities. Elderly and disabled residents are suffering from poor sanitary conditions, inadequate supervision, and a number of other safety-related deficiencies.

When a nursing facility fails to provide residents with essential health and safety services, the nursing home and its employees may be held liable for negligence. Food, shelter, medical care, clothing, and supervision must all be provided for. Nursing homes have a legal duty to meet the basic needs of residents and provide them with reasonable care. Failure to meet this duty can result in a nursing home negligence lawsuit, which may entitle the resident and the resident's family to compensation.

If you or a loved one has been hurt by negligence or abuse at a nursing home or assisted living facility, our skilled nursing home negligence attorney can help you understand your legal rights. It is important to contact one of our nursing home neglect lawyers immediately if you are suffering from poor quality care, because there is a statutorily limited period of time in which a lawsuit may be filed.