News
New York Times Exposes Nursing Homes Placing Profit of Patient Care
Posted on Jan 29, 2009
On October 23, 2007, the New York Times published the results their in depth investigation into private equity groups that are purchasing nursing home chains. Many argue they have returned the industry to profitability but at the expense of patient care. These groups have set up elaborate corporate structures that enable the investors to receive a handsome return on their investments but leaving the nursing home underfunded and with limited resources to compensate victims of abuse and neglect. The systems is relatively simple. The nursing home is set up as one corporation with minimal insurance coverage. The nursing home pays large fees to landlords, management companies, and other corporations. These corporations are in the black while the nursing home appears insolvent and judgment proof. Yet, when you dig into the ownership of the landlords and management companies, you often find that they share the same investors. The ultimate result is that the victims of abuse and neglect struggle to be compensated for their injuries. There are strategies to hold all of these companies responsible. Lawyers call it "piercing the corporate veil." Please call us if you believe a loved one has been abused or neglected in a nursing home.
