Consumer Group Accuses SNF Industry of “Lousy” Care Despite “Staggering” Earnings

A consumer group is pointing an accusatory finger at the nursing home industry for reporting “staggering” first quarter earnings, while more than a third are providing “lousy” care.

In their first quarter earnings reports, many publicly-traded companies operating skilled nursing facilities spoke of “record revenues” and “operating profits that exceeded expectations,” points out Brian Lee, executive director of citizen advocacy organization Families for Better Care. 

“Nursing home owners are obviously ‘coping’ from last year’s Medicare adjustments through progressive acquisition strategies and imaginative cost mitigation techniques,” said Lee. “What’s also bolstering their profitability is a stronger Medicaid reimbursement rate, growing two percent over the past year.”

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In April, Families for Better Care made similar comments about the skilled nursing industry, bashing it for turning “astonishing” profits while delivering “inferior care.” At the time, Lee said much the same thing: nursing homes had expressed a lot of concern about the Medicare cuts that went into effect last October, but seemed to mitigate those cuts in the fourth quarter. 

The biggest concern for the advocacy group is that, despite turning profits, the industry is doling out “substandard care” in about 35% nursing homes that have “below average” or “much below average” scores, according to Medicare’s Nursing Home Compare data.

“Strong margin calls may appease shareholders and investors, but many residents are languishing from pressure sores, broken bones and the overuse of antipsychotic medications,” Lee says. “Facing a 1 in 3 chance of being admitted into a lousy facility is a daunting proposition for consumers.”

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The industry needs to find a way to balance profitability and quality of care, says Lee, who called for greater transparency and disclosure from nursing home companies, along with a restructuring of the payment system.

Around the same time of the consumer group’s comments, newly-released government data indicated that nursing home quality ratings are improving. Looking at more than 15,000 facilities, the Centers for Medicare & Medicaid Services (CMS) reported that its five-star rating system for skilled nursing facilities showed that the number of four- and five-star centers has increased by 4% and 4.1%, respectively, while the number of one-star facilities decreased 7%. 

“Quality is a continuous journey for our members, who strive every day to meet the needs of our residents and their families,” said Mark Parkinson, president and CEO of the American Health Care Association. “We’re excited about this positive trend, and will continue to work with CMS to do more in these critical areas.” 

Written by Alyssa Gerace

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