Recent Press Reports May Push Congress To Seek Nursing Home Ownership Reforms – It’s About Time

By Jeffrey J. Downey, Attorney

The power of the press is something to behold sometimes, and it leads to further change with the response by the Biden Administration to a recent article in USA Today revealing the ongoing attempts by the for-profit industry to revise the numbers of deaths during the pandemic.

In this particular case, Trilogy Health Services, whose parent company is American Healthcare REIT, a real estate investment trust, revised its numbers of deaths down over 300 from nearly 800 from October 2020 to February 2021 time frame, asserting that the revisions were based on federal guidance.

Following the USA Today report, the Centers of Medicare and Medicaid Services (CMS) said it would investigate the reports of data inaccuracy.

In addition, last week the National Academy of Sciences, Engineering and Medicine called for federal officials to expand the government’s tracking and regulating of nursing home companies. The chairwoman of the panel who released the report, Betty  Ferrell, called the US nursing home system “ineffective, inefficient, fragmented, and unsustainable.”

It should come as no surprise that the numbers provided by the nearly 15,000 nursing homes across the country during covid and before were self-reported.  And federal rules adjusted for the pandemic allowing the facilities to charge a higher rate for people with Covid who were treated at the nursing home instead of being transferred to a hospital.

CMS has required facilities to submit weekly reports of new Covid-19 cases and deaths to the National Healthcare Safety Network – NHSN, a database operated by the CDC.

The government has used the information to award billions of dollars in Covid aid as well as target inspections and identify facilities that might need extra support during outbreaks.

“Some are properly calling for punishment of those companies that are intentionally revising their data to improve their economic outlook,” explains nursing home attorney Jeffrey Downey.   Many healthcare facilities were also incentivized to over-report Covid-19 deaths and patients had the diagnosis listed on their death certificates, even in cases where they died after they recovered from Covid-19.

David Grabowski, a health care policy professor at Harvard University medical school who studies nursing home performance, called Trilogy’s revisions “suspicious.”  “Either they are admitting they submitted bad data or they are going back and altering the data to make themselves look better,” he said. “I don’t like either of those outcomes and both of them speak to the need for increased oversight and accountability.”

The CMS said that its reviews of NHSN submissions are limited by “capacity challenges,” which can be interpreted as staffing, and President’s Biden budget in the Build Back Better proposal would have increased CMS inspection resources by nearly 25 percent.

The White House is preparing to use its executive authority to tighten regulations while some members of Congress say they want to dig into the corporate owners and operators.  In addition to collecting rent, American Healthcare shares profits from Trilogy’s operations – a model allowed under a federal law revised in 2008. The concept was permitted earlier for REITs outside health care to allow them to offer basic services for their properties, such as cleaning.  American Healthcare REIT appears to be the first large trust to use RIDEA, or the REIT Investment Diversification and Empowerment Act, in nursing homes.

Complex ownership structures involving a number of related businesses, owners can reduce taxes, shield money from potential lawsuits and move profits up the corporate food chain even as individual facilities report operating in the red. This makes it difficult for the federal government to understand how much of its nursing home funding, paid through Medicare and Medicaid claims, goes to support the care intended for our seniors.  Our loved ones should not be suffering from a lack of treatment that results in pressure sores, pressure wounds, falls or other serious injuries because nursing homes are looking at the bottom line and only the bottom line.

“It’s important that we learn the lessons of prior equity takeovers, as when the Carlyle Group took over the ManorCare chain,” explains Downey.  “Patient care suffered and ManorCare ended up being prosecuted for Medicare Fraud.”   CMS tracks the performance of facilities by requiring the reporting of adverse events like pressure wounds (bed sores), falls causing injury, impaction, wrongful death, etc.  When private equity firms take over healthcare facilities, staffing is often reduced, which increases the risk to patients, especially the vulnerable elders in nursing homes.

As a call for action, contact your local legislator to bring this issue to the forefront.  The press has done its job as the Fourth Estate.  Now it’s the people’s responsibility to push it forward.

If you or a loved one have been the victim of elder abuse involving a nursing home or assisted living facility or another health care provider, contact our personal injury law firm at 703-564-7318 to learn more about your legal rights. We handle cases in Virginia, Washington, D.C., and Maryland. If you cannot come to us, we can come to you.  Learn more about the Law Office of Jeffrey Downey by reviewing what our clients have to say about the law firm.

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