Nursing home trust-fund crimes aided by lack of oversight: report

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Theft or poor management from trust funds of nursing home patients is aided by a lack of regulations, according to a new USA TODAY report.

Background checks of nursing home office workers are not required in 20 states. Only four (Alaska, Iowa, Maryland and Washington) require a full review of residents' accounts while four others have partial oversight, the newspaper discovered.

Though office workers do not typically come in contact with residents, a resident may request one to manage a trust account. In October, USA TODAY reported that thousands of nursing home residents have had their savings pilfered from trust accounts by business managers, bookkeepers and office staff. Industry leaders, however, said the misfeasance related to trust accounts is rare. 

Without uniform auditing, the thefts can go unreported for long periods of time. Some losses have gone as high as six figures.

Nursing homes have to follow the standards of the U.S. Centers for Medicare and Medicaid Services, but federal laws do not require that resident trust fund accounts be audited. CMS officials said they are considering whether more rules are needed to protect residents' trust funds.

"We are aware of this situation and are reviewing the (inspection) procedures used to detect these kinds of problems," agency spokesman Aaron Albright told USA TODAY. "CMS takes safeguarding nursing home patients very seriously."

In addition to the four states that require audits of resident trust accounts, USA TODAY identified four others that mandate partial or occasional audits, such as periodic reviews of a sampling of a facility's trust fund records.

Greg Crist, senior vice president of the American Health Care Association, said some operators audit trust accounts and background check staff.

"Several (chains) across the country have made the decision to just build these practices into their business model," Crist told the newspaper.

USA TODAY's investigation identified more than 1,500 cases since 2010 where operators were found not to have paid interest on accounts; properly accounted for holdings; or kept the funds properly insured.