Corporate Neglect in Nursing Homes

A recent article published in Trial magazine entitled “Corporate Neglect in Nursing Homes” catalogues the ways in which increased corporate ownership and focus on corporate profits have contributed to abuse and neglect of nursing home residents and frustrated victims’ ability to hold the nursing homes accountable.   For instance:

 

• Evidence shows a direct link between nursing home staff hours and problems.  That is, as the number of staff hours declines relative to the number of residents, problems rise.  The profit goal creates pressure to keep staff hours low and occupancy high—even when it is apparent that additional staff is necessary to ensure quality care.

 

• Nursing home operators often create a Byzantine ownership structure to ensure that the operating company has little, if any, assets available to compensate the victims of neglect or abuse.  Instead, revenues flow out of the operating company to parent or affiliated corporations.  The operating company may carry only minimal insurance.

 

One way to overcome the attempt by the nursing homes to insulate themselves from responsibility is to pursue claims against both the operating company and the parent or corporate affiliate that shares in the profits or revenues.  This may require showing that the parent or affiliate was involved in the budgetary decisions which compromised resident care.  The evidence will support this theory in most cases, because the parent or affiliate exercises tight control over the operating company in order to maximize profitability.