The Nursing Home Ownership Puzzle

It has become much more common to find that the known name for a nursing home is not related to its true nursing home ownership. Often, owners of nursing homes are carefully hiding the identity in a maze of ownership.

A plaintiff’s lawyers who handle nursing home cases are cautious about researching ownership. Today more than ever, nursing home operators find that elderly residents are filling these facilities at higher occupancy levels.

There is more and more demand for elder care in independent living or assisted living in nursing homes. Because of the demand, ownership of nursing homes is on the private investment company favored list of acquisitions. Private equity enterprises and larger publicly traded companies are operating more nursing homes today than ever before.

Because the motivation for private equity enterprises and public companies is profit, slashing staff is prevalent. Naturally, as personnel are laid off, nursing home residents directly suffer.

With a reduction in staff, residents of nursing homes are found to suffer more neglect, injuries and death, resulting in lawsuits. To counter exposure for potential liability, these private enterprises and public companies are eager to create complex corporate structures to make it difficult to identify ownership. One of the lynch pins of knowing the correct nursing home ownership is to research data available online. The federal database Online Survey and Certification Automated Record (OSCAR) is helpful in such a search. The data on this site offer information about ownership, including for-profit and chain status. This online survey will also identify the name and organizational type of the parent company for the nursing home.

With a greater need to understand ownership structures of nursing homes, the Office of the Assistant Secretary for Planning and Evaluation (ASPE) has worked out a plan with Harvard Medical School to study the trends in nursing home ownership structures and the impact there complex structures have on the quality of nursing home care.

By way of an example, one company known as Senior Living Properties located in Texas owns 50 facilities and has 4,530 beds held as a limited liability company.
Behind all of this structured maneuvering by nursing homes owners is to evade or escape litigants from recovering on judgments against individuals or entities other than the licensing of the nursing home. The licensee of a nursing home is usually a shell company with no attachable assets. What has surfaced is the nursing home industry’s mechanism to create single-purpose enterprises to prevent litigants from recovering. In this way, the nursing homes’ revenue is funneled into the parent companies’ control. In order to cut through the machinations of these corporate structures, it is essential to uncover with diligent discovery the interworking of the nursing home’s ownership. That includes learning who the officers, directors, shareholders, and partners are through tax returns, financial statements and policies and procedures. Personnel files are useful in identifying those who are active in these nursing homes.
Kreisman Law Offices has been handling nursing home abuse cases for individuals and families for more than 36 years, in and around Chicago, Cook County and its surrounding areas, including Tinley Park, Forest Park, Elmhurst, Chicago (Lincoln Park), Bridgeview, Maywood, Oak Park and Calumet City, Illinois.

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