Will Ownership Disclosure Help Nursing Homes?

Will Ownership Disclosure Help Nursing Homes?

Multiple studies have illustrated concerns regarding private equity and investment trusts purchasing and managing such facilities.

The U.S. Department of Health and Human Services (HHS) has announced additional action to increase transparency of nursing-home ownership and management. The Department recently issued a proposed rule to require nursing homes to disclose to the Centers for Medicare & Medicaid Services (CMS) additional ownership and management information. The rule also includes private equity and real estate investment trust definitions, setting the stage for the disclosure of which nursing-home owners fall under either category.

This sounds like an important development in the effort to improve nursing-home care. Such transparency can help ensure that nursing homes are held accountable for the quality of care they provide, and it can give residents and their families the information they need to make informed decisions about their care.

Private equity and real estate investment trusts have increasingly become involved in the ownership of nursing homes in recent years. While these types of investors can bring financial resources to the table, there have been concerns about their focus on profits at the expense of quality care.

Requiring nursing homes to disclose ownership and management information, including whether they are owned by private equity or real-estate investment trusts, can help ensure that these facilities are providing the highest quality of care possible. It can also help identify any potential conflicts of interest that may be impacting care provided to residents.

A study published in the Journal of the American Medical Association (JAMA) found that nursing homes owned by private-equity companies had more deficiencies in quality of care, including more deficiencies related to infection prevention and control, compared to non-private equity-owned nursing homes. Another study published in the New England Journal of Medicine found that private equity-owned nursing homes had higher rates of hospitalizations and lower nurse staffing levels, compared to non-private equity-owned nursing homes.

These findings suggest that there may be a link between ownership type and quality of care in nursing homes.

Overall, this proposed rule is a positive step toward improving the quality of care in nursing homes and ensuring that residents and their families have access to the information they need to make informed decisions.


Timothy Powell, CPA

Timothy Powell is a nationally recognized expert on regulatory matters, including the False Claims Act, Zone Program Integrity Contractor (ZPIC) audits, and U.S. Department of Health and Human Services (HHS) Office of Inspector General (OIG) compliance. He is a member of the RACmonitor editorial board and a national correspondent for Monitor Mondays.

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