A Place for Mom is again in national news following the announcement of a formal probe by Sen. Bob Casey, chairman of the US Senate Special Committee on Aging, who penned a letter that alleges “deceptive business practices.”
The letter states the referral service’s marketing materials and recent reporting “contradict the company’s claims” of being “an unbiased and no cost referral service for families.”
A Place for Mom had not responded to Senior Housing News as of press time.
Casey’s letter asks the company to provide documents and responses regarding its practices “so families can have a better understanding of what A Place for Mom’s recommendations mean.”
Among the primary issues highlighted in the letter is how referrals work at the company, and how the referrals relate to payments that the company receives from senior living providers. Information from Casey states A Place for Mom’s network includes 14,000 communities and facilities out of the 30,600 in the country.
“As the former Chief Marketing Officer for A Place for Mom recently cautioned, ‘Many advisors online and in your local community are very knowledgeable about provider options—but only those they contract with. As a business, they naturally only present or recommend senior living communities that agree to pay them a commission,’” the letter states.
The letter also draws attention to how much consumers are paying for senior living, alleging that the providers increase their rates to help cover the commissions they are paying to A Place for Mom. Casey also claims that “upselling” is occurring, with nearly 40% of families referred to communities paying above the upper limit of their budget for assisted living communities. That number reaches 55% for memory care referrals.
“According to A Place for Mom’s website, upon move-in to a facility, ‘the community only pays for first month’s rent and care’ to A Place for Mom,” the letter states. “In reality, facilities pass those costs along to residents and their families who pay significant fees for assisted living.”
Alongside these issues, the letter cites the Washington Post’s reporting about the company putting residents at risk, with some of their award-winning communities being cited for “serious violations affecting resident care.”
A response to the letter is expected by July 15.
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