Accountability for nursing home owners

When is there accountability for nursing home owners when a resident is abused or neglected? Perhaps more importantly, are there any qualifications for being an owner? In this week’s episode, we welcome Richard Mollot to talk about the laws surrounding nursing home ownership.

Schenk: Hey out there. Welcome back to the podcast. My name is Rob. I’m going to be your host for this particular episode. We will be having a conversation about the important of knowing who owns the nursing home that your loved one is in. That information can help you make a determination of whether you can expect good care, bad care or something else entirely.

But before we get into it, I have one ask, and that is please like and subscribe if you’re enjoying the content of these episodes wherever you get your podcasts from, and then go over to YouTube. Check us out on YouTube. Watch those videos. We have hundreds of hours of information at your fingertips. So mosey on over there, take care of that for me. It would be great if you did.

So today on the podcast, we are going to have a special guest, in fact, one of the most prolific guests for the Nursing Home Abuse Podcast. His name is Richard Mollot. Richard Mollot is the executive director of the Long-Term Care Community Coalition – that is a mouthful, the LTCCC, a nonpartisan, nonprofitable organization dedicated to improving care for individuals in nursing homes and other residential care settings through legal and policy research, advocacy and education. Richard has researched and published on a variety of long-term care issues including dementia care, nursing home and assisted living facility standards, the rights of older adults in nursing homes, abuse and neglect in nursing homes and finance. He is a graduate of Howard University School of Law and a member of the Maryland bar. And we are so happy to have him on again. I’ve lost count of how many times he’s been on the program. This might be the sixth, seventh, eighth time – who knows now? But at any right, glad to have him on talking about ownership of nursing home facilities. Richard, welcome to the show.

Mollot: Thanks so much. Thanks for having me, Rob.

Schenk: All right. So I feel like, and I feel like I say this every time, but we need to just make you an honorary co-host. That’s how often you’re on the show. However it’s been a minute since you’ve been on, so thinking fourth-dimensionally, although we are recording this on a date certain that this won’t broadcast for a while. But anyways, since then, it’s been a while but wanted to have you back on.

The reason I wanted to have you back on is because I saw an excellent webinar or seminar, virtual whatever you call it, on your website that dealt in a way with the issues behind why it’s important for people that have a loved one in a nursing home to know who owns the nursing home. We focus on this podcast and in our line of work a lot on like, “Hey, how did they mess up the medicine? Why aren’t they doing what they’re supposed to on the care level?” The webinar that I saw was great because you kind of did a 40,000-foot view of like, “I think it’s important that maybe at some point we address ownership.” So that’s a little bit about what I wanted to talk to you about.

Can you, just kind of for the audience, just talk about that concept, like why should I, if I’m putting my grandmother in a nursing home, care who ultimately is the person who owns that facility?

Who owns nursing homes?

Mollot: Well that’s a great question. Thanks, Rob. So I mean everything comes down, just like anything in life, everything comes down to who is pulling the strings. And the people that pull the strings in the nursing home world are really the owners. So when we talk about, as you’ve been saying, we’re most concerned with how the residents are being treated, the level of care they’re getting and how that’s being supervised in the facility, but all that comes from the ownership.

And this is something that’s become much more – what I like to say, excuse me, is that the industry has become increasingly corporatized, that it used to be you had these mom and pop nursing homes that were owned, they were connected to the community whether they were for-profit or not-for-profit, and there certainly were always good and bad nursing homes, but that there was some kind of connection between the ownership and what was going on between the ownership and the community at large. And we see less and less of it now. Most nursing homes in the country are now run for-profit, and there’s increasing corporate ownership, and as I was saying, it’s not just corporate ownership but I like to say a corporatized environment, where they’re very, very sophisticated and there’s more and more of a disconnection between resident care, staffing, which of course is so essential, and who’s owning that facility and who’s calling the shots.

Schenk: Yeah, and I think that’s a super important point. It’s kind of like we hear those stats growing up about how in 1950, the CEO of any given company makes 10 times the entry level employee and now it’s 5,000 times, or even my experience with this is growing up, my late father was born in 1938 and that’s his mentality when it comes to the owners of these businesses. And I would be so embarrassed and so frustrated when we’d be either at the bank or at the grocery store and he’s either trying to haggle with this person or is like, “Let me see Mr. Johnson, the guy that owns this place,” and it’s like, “Sir, Mr. Johnson died in 1976 and we’re owned by First American Union Bank in Walla Walla, Washington. I’m sorry, but you can’t talk to Mr. Johnson anymore.”

So the idea that ultimately we can communicate and be eyeball-to-eyeball with somebody that is accountable to our loved one, that no longer exists. That no longer exists. So that’s an interesting point. So being able to communicate with someone where the buck stops…

Mollot: Exactly.

Schenk: That’s something that like could affect the care. So what are you seeing now? If I understand correctly, most mom and pops are gone, at least I know in the state of Georgia, I don’t run across mom and pops anymore. There’s four or five facilities that own 50-plus locations. So is that what you’re finding in your research, in your studies across the United States that it’s becoming more centralized with the few corporations?

Does CMS typically prosecute poor ownership? 

Mollot: Yes. So that’s one factor. And then kind of getting back to the idea of the corporatization of the whole industry is that a lot of those owners themselves aren’t really full owners. They oftentimes have sold the underlying property to someone else, to another corporation, which they may own themselves. So it gets very complicated very quickly. And the result is from our perspective, getting back down to the resident, is again, there’s just less of a connection to the money that’s coming in to pay for care, whether Medicare/Medicaid/your Uncle Jack, doesn’t matter, that money coming and actually going towards care. It’s being funneled to what’s called related parts of transactions to pay for maybe the real estate, to pay for services that are coming in, whether it be accounting or food services or therapy services.

That money and resources are being diverted, and again, you have that lack of responsibility, even though importantly the administrator is supposed to be responsible, but we’re seeing as results of the issues you and I are talking about, is that we’re seeing is that the administrator really does not have a say. The administrator is told to meet a bottom line, to have goals in terms of not resident quality but goals in terms of profit.

Schenk: That’s right. And I know firsthand when we are deposing administrators in nursing home negligence cases, we go down the litany of questions. Do you have to get permission to write a check greater than 500 bucks? Who determines the nursing to staff ratio here? Who provides the training here? And it’s never the administrator even though it should be the administrator. The administrator has absolutely no idea what the budget looks like and they’re the ones that ultimately, at least according to federal regulations and definitely Georgia regulations, they should be knowing this information and they absolutely don’t. And it’s just like you said – it’s almost like the facility is a work of fiction. It’s actually being controlled by these interrelated parties ultimately controlled by the ownership, the corporate ownership.

Mollot: Yes.

Schenk: So let’s talk about this. For the audience out there that kind of doesn’t understand the hierarchy of things, typically at least in Georgia but most everywhere because all nursing homes accepting Medicare or Medicaid are governed by federal regulations, so it’s kind of uniform, works like this. You have what’s called a governing body and that is either some entities or people and they’re the ones that are kind of like the board of directors of a corporation for lack of a better term. These are the ones that would hire an administrator.

So it goes like this. At the facility, the administrator, the buck stops at the administrator at the facility but the administrator has to report to the governing body. And then the governing body essentially can be composed of people by the owner, kind of in the hierarchy of things like that. That’s kind of what we’re talking about.

Now with regard to, for lack of a better word, moral fitness and fitness of character, we have laws that apply to employees, the ones that are actually helping your grandmother with activities of daily living, the directors of any staff person, any W-2 employees, at least in Georgia, is getting a background check. They have to pass some type of moral fitness to be there. They can’t have committed a felony in the past. Then you’ve got the same concept for the administrator, at least in Georgia. In order to get a license, you have to apply for that license, and to get that license, you’ve got to show a certain amount of education, moral fitness, pass the background check. Can you speak to the possibility of that being the case with ownership?

What does CMS say about qualifications for nursing home owners? 

Mollot: Well I certainly can and that’s decided on a state level. So we actually did research earlier this year, which resulted in the program that you had referenced earlier on that we did. But we did research to look at what promising practices are there among the states in evaluating nursing home owners. It’s a big issue. There’s been some movement to try to make some change in that in the federal level but really it all comes down to state.

And what the states generally look at when they have what’s called a certificate of need process, generally, CON, you can see that – people can also be involved in that. I know in my home state of New York, they have meetings that are broadcast as well as, before COVID, in person, etc. But states do a varying job in implementing those rules, so there are some good rules out there, but for the most part, they’re not well-implemented, and that’s what we have, unfortunately a lot of crummy chains.

But the central point is that really two things with these certificates of need – one is, as you said, what we also called character and competency. What is the character and competency? Just as those words plainly mean of the person who’s taking over as ownership – they don’t have to be Mother Teresa, they don’t have to be a Nobel Peace Prize winner, but they hopefully have someone who is decent who is actually going to fulfill and is committed to fulfill and has a history in the other ownership facilities of fulfilling the basic standards of care for their residents.

And then the other thing that they often look at is financial integrity. To what extent is the prospective owner either of a new facility or to build a facility, is he or she able to sustain that facility? What kind of track records do they have, etc.? Unfortunately, and we see this as I’m sure you know, we see this with nursing homes generally with oversight, generally that they tend to be very poor evaluations of nursing home owners and of care. So like you mentioned before, the administrator has a responsibility, staff have a responsibility, but we see unfortunately a lot of abuse and neglect, including sexual abuse in nursing homes and rarely gets punished, rarely gets recognized as harm when residents are abused in that way by the states.

So in short, I would say there is a system in place for which this could happen and our report, we looked at again was what is out there? What are states doing then that is interesting? To me, my biggest issue in respect to our advocacy here is to really look at the character and competency, to really look at someone who’s buying facilities, and as you were saying before, in Georgia and throughout the country, they’re largely chains now and increasingly so they’re chains. They’re for-profits. This is not people who are buying chains to run them not-for-profit. They’re making a profit here. What are they doing to ensure that the care is being provided to residents, that they’re, again, meeting those standards? What has been done? And what is their track record? Let’s look at their track record and let’s say, “No, you can’t buy another nursing home if you have a poor track record of violations, of poor staffing, etc.”

Schenk: I think that’s a good point because I guess when we’re saying moral fitness, that typically comes to mind an actual human person. Have they committed crimes? Are they a good person? Will their neighbor vouch for them? But track record is actually moral fitness for a company, which acts through people. So I think that’s a good way to look at it, like how much benefit would a potential resident of a nursing home have, how much benefit is there for you to know whether or not the owner, which is a company, has been cited in the past for their violations of regulations? Or they own 1,000 facilities, right? Or have they ever run one into the ground? There’s a certain amount of information in the track record that like, you know what? Maybe I’ll go to the one down the street.

You and I both know there’s just sometimes it’ll be you’ll drive past a facility and it’ll say, “ABC Rehab.” Then the next week it’s “XYZ Rehab,” but it’s the same owner, different sign, right? So it’s the same care being provided. So yeah, I think it’s interesting – at least I think would be beneficial to know.

So in your research then, what are some interesting things you’ve seen states doing or maybe moving in that direction with regard to, I guess, publicizing the track record or requiring certain things? Are we even there yet?

Mollot: Yeah. Yes, so we are. Some states, what they’re doing or what they’re looking at is having a public comment period for this exact reason. So if you – say you were in – I don’t want to say a name, so say you were in an ACME facility or you had a loved one in an ACME facility, and there’s a public notice that ACME is buying, wants to buy another facility. You could comment and they would have to, whoever is the body, the council or the state health department that is making the decision about allowing a purchase to go forward or not, would have to take into consideration what your input is. So that is a very direct way.

It is complicated and that’s why so I would say personally my thinking is it’s worth knowing, it’s worth looking on Nursing Home Compare, the federal website. You can very easily see who has a management role in the facility, significant management role, and who owns 5 percent or more. That’s part of the 2010 Affordable Care Act  that’s required to be on there.

But as we’ve also been saying, a lot of this gets very complicated because of these so-called related party transactions. So my down and dirty advice, so to speak, would be one, we really have to count and ask our state legislators to ask our state governors, ask our state departments of health to implement some of these practices, to really make sure that we are entrusting care with someone who is trustworthy. And then two, to the extent possible, doing some due diligence about owners if we’re looking at a facility, even if we’re just spending 20 minutes online, look to see what other facilities they own, what are the star ratings, etc. They sometimes even have a connection. If you’ve been in a community for 10, 20 or 30 or 50 years, you will know other people who have undoubtedly experienced nursing home care by those owners. And again, because there’s just very few of them, very few of the bigger companies, and to use that, because past is prologue. Anyone, I know how you are going to act because we have had interactions before and you have a history and we have a history together to a certain extent. And that’s how we have to judge nursing homes.

The problem is frankly that unfortunately the government, the state governments don’t do a very good job of that and the federal government is very, very hesitant, something that we’ve been advocating for for years, go after these owners. If you know that these owners are doing a poor job in Nebraska and in Georgia and in Missouri and they’re buying up facilities in Texas, I’m not saying shut them down but I’m saying at least we have to evaluate what is going on and make sure they are putting in place good practices, protocols, investment in those facilities so they’re not pulling money out.

Schenk: That’s an excellent point. And for me, speaking to the Nursing Home Compare, I just feel like with the minimal amount of data that’s collected right now, we already have the means by which if you did go to Nursing Home Compare and you did look and see who the owner was, you still wouldn’t have a good understanding of whether or not it was a good or bad owner. But the data is there for CMS to put a red, yellow or green flag next to it based on how many citations are associated with that particular owner. So the data is already there. All you’ve got to do is follow through with a little bit of technology and that gives a little bit more information into the palm of the hand of the user. As you mention, right now, some of that information’s out there but you have to be really knowledgeable about navigating CMS’s website to really get benefit from it.

Mollot: Yes. There is ownership data in the underlying database. If someone wanted to dig deeper, like if you were working with a number of different residents or facilities or communities as an advocate or ombudsman, that’s certainly a possibility. We publish some of those data. We publish ownership data periodically on our website, of course nationwide. But I think kind of poking around, looking at staffing, to me, staffing and staffing numbers are by far the most reliable and staffing is so important that that’s always where we always direct people’s attention to, and frankly as I’m sure you know, Rob, if a facility or owner wants to cut back, the first thing they cut back on is staffing.

Schenk: Absolutely.

Mollot: Yeah, so that’s really to me, it’s pretty easily accessible on Nursing Home Compare because you can compare three facilities at one time, so if you wanted to look at a couple of others, again, that’s something you can do within 10 or 15 minutes having the knowledge of this conversation, for instance.

Schenk: Right. And just so the audience is aware, when we’re talking about interrelated parties, ownership, this isn’t something like Richard’s going out investigative reporter style and yanking people out of their cars and interrogating people. This information is actually public record because just really quickly, in order to receive Medicare or Medicaid funding, the federal government requires a facility to provide them with certain information, which is provided to the government under penalty of perjury. So to some extent, we can be assured that it is accurate, at least from the perspective of the facility. So some of that information that is requested in order to get Medicare/Medicaid funding is who is the facility paying, what entities are the facility paying for services including management services, therapy services, rent, like if the facility is paying a mortgage or paying rent on a property, all this. And if there is common ownership, then the facility must list that.

So there are documents that exist that are called cost reports that essentially function like a tax return that have a bunch of information, including who all the owners are, whether the owners own related parties and how much they are paying for those services and how much those services are actually worth. So I don’t want people to think that this is some kind of, I don’t know, like crazy conspiracy theory we’re talking. These are actually public knowledge you can look up if you have the training and education to do so. It’s out there if you want.

And as Richard said, technically it’s on the CMS website, but man, you’ve got to really know what you’re doing in order to harness that information. I just want to let everybody know that it’s real information out there.

So okay, we’ve kind of talked about the benefits of knowing who the owners are because in today’s day and age, it’s becoming more corporate and care suffers and you want to know more about that. You have Nursing Home Compare. Can you tell your audience that haven’t listened to this podcast before what the Long-Term Care Community Coalition is all about and Nursing Home 411, and what information, if they were to go to NursingHome411.org, what they would find?

What are some LTCCC recommendations with regard to nursing home?

Mollot: Sure, yeah, and thanks for the plug. So my organization, Long-Term Care Community Coalition, we are a nonprofit. We are just celebrating our 30th anniversary and we are also nonpartisan and we are entirely dedicated to improving care and quality of life for residents in nursing home and assisted living, other adult care facilities. But everything that we do, one, we do only really systemic work, so we don’t, unfortunately, are not able to take on individual cases to help them, etc. We refer them to attorneys like Rob and to others because, of course, they can file a complaint or handle them, etc.

But on our website, we have really two things that I think are useful. One, I printed the report that I mentioned before. We have a chart of state recommendations. People can say what’s going on, if they are talking to their legislators, and if they do, are they speaking out about it? We encourage them to do that. But we also publish a lot of data. We essentially, as Rob was saying, the data on CMS Compare, the underlying database beyond the facility listings, can be really complicated. It’s 15,000 nursing homes is just lots and lots of data.

What we’ve been doing for several years now is that on a roughly, generally quarterly basis or every half-year, depending on the value of the currency of the information, we publish in-state files data on every single nursing home in the country that’s in compliance with the quarterly quorum. So we have the staffing data for every single nursing home, their care staff. We were talking before, we have the administrative staff. We have medical director staff. We publish data on enforcement actions, penalties. We publish data on pressure ulcer rates and they’re not available now because of COVID, but generally speaking we do that a couple times a year, and antipsychotic drugging rates, etc., so people can, when they’re concerned about something, whether it be dementia care or just the staffing in a facility, they can look that up pretty easily. We have individual state files. And actually as of now or at this moment, I should say, we’re implementing, we’re putting together a map, so pretty soon we’ll have a map on the website where you can go there, click on your state and get all the latest data really easily.

And then the other thing that we have that’s hopefully useful is we have a learning center. So we have fact sheets on all the – not all, but most of the most pertinent federal standards for nursing home care. We have tools for families and for ombudsmen for them to track complaints when they have them, to help them see what’s going on and advocate effectively for their resident in the facility. And everything is free.

Schenk: Yeah, and Richard is humble when he says there’s two principle things that are helpful on the site. There are many things that are helpful on that site. I have gone down the rabbit hole on NursingHome411.org on a couple of occasions at minimum. He also has all that information on YouTube. If for some reason you can’t find the website, you can just YouTube it. There’s a bunch of YouTube videos. You can learn a lot. Depending on what subject matter within the nursing home industry you want to learn about, Richard’s organization has covered it at length. But I would also, again, draw your attention to there are a lot of I would say actionable pamphlets, like you don’t have to be an attorney to understand your rights, and they really put it into every day words and you can print that out and take it with you and truly understand what your rights are for your loved ones in a nursing home. So I can’t praise his organization, his website enough.

Mollot: Thank you. Thanks very much.

Schenk: Welcome. So Richard, fantastic. I’m going to put the website in the show notes. And again, thank you so much for coming on the show. I had a great time and I think this is a conversation that I’ve wanted to have for quite a while now, so I’m glad you were able to come on and have that.

Mollot: Thanks, Rob. Yeah, appreciate it. Best to both of you guys.

Schenk: Always a pleasure to have Richard on the show. Hopefully you found this episode informative, and if you did, please be sure to review it wherever you get your podcast from. Check us out on YouTube. Again, hundreds of hours of information on our YouTube channel as well as our website, NursingHomeAbusePodcast.com. And new episodes every other week, that’s two times a month for your listening and viewing pleasure. They come out on Mondays, so be on the lookout for them. And with that, we’ll see you next time.