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Focus on profit can take away from care quality in nursing homes

January 9, 2018
by I Advance Senior Care
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The latest analysis of nursing home ownership comes from Kaiser Health News (KHN), which examined organizations with complex corporate structures that can be used to pad the pockets of owners while protecting them from lawsuits.

According to Nonprofit Quarterly (NPQ) and multiple studies over the last two decades, for-profit ownership of nursing homes, particularly for-profit chain ownership, correlates with substandard care. Yet, for families in search of care, finding a nonprofit may not always be possible. Since the 1990s, corporate chain ownership has grown steadily and now dominates the market. Today, nonprofits own less than one in four nursing homes, while for-profits control nearly 70 percent. (The remaining five to six percent are government facilities.)

Increasingly, KHN explains, owners of nursing homes outsource services to multiple entities in which they also have an ownership interest. For example, buildings are owned by real estate trusts, while the nursing home is leased by a management company. Physical therapy services, pharmacy services, dining, and maintenance can all be outsourced to sister companies.