Study finds private equity ownership decreases quality of care

A study conducted in Florida has found that most nursing homes that are sold to the private sector experience a decrease in the quality of care they offer after having been sold.

Nursing homes that were once publicly traded companies saw an average decrease of .5 stars within a few years of being sold to a private equity investor. Also, after their sale to for-profit private investors, the percentage of facilities with well-above average quality ratings dropped from 28% to 14%, showing an indisputable decrease in quality of care. Additionally, the number of nursing homes rated with 1-star more than doubled to 21% after their sale.

Unfortunately, the story continues, as the report by AARP also found the level of direct care provided to each resident decrease by 13%, as resident were robbed of quality time with caretakers. Specifically, that’s 33 fewer minutes of care given to each resident every day.

Not only did residents receive less and lower-quality care, but Medicare costs also rose $1,000 per resident in these newly privatized facilities.

Lawmakers are also to blame here, as the legal status quo has made it so there are easy loopholes for private investors to escape responsibility for wrongdoing in nursing homes. Currently, amalgamations of private investors make it difficult to pinpoint who is actually to blame for negligence and low-quality care, and investors are also given more leeway to hide the truth of their facilities quality of care. Ultimately, there is little to no accountability to limit the wrongdoings of for-profit investors.

While AARP has yet to conduct a study determining the number of early deaths and unnecessary injuries this transition from public to private ownership will cause, the numbers already provided make it easy to speculate.

These findings may act as a lesson to anyone who believes CEOs with no background in medical care and passions for profit-making manage healthcare facilities just as well as public or government-funded facilities.