Congressional leaders demanded insight on the spending policies of three large chains that provide long-term care, casting doubt on their leaders’ claims that they cannot afford to meet the new federal nursing home staffing mandate.
Democratic Sens. Elizabeth Warren (D-MS) and Richard Blumenthal (D-CT) as well as Reps. Lloyd Doggett (D-TX) and Jan Schakowsky (D-IL) were joined by progressive Sen. Bernie Sanders (I-VT) as signatories of three letters sent Sunday to Ensign Group, National HealthCare Corp. and Brookdale Senior Living.
The letters shared mostly identical content, with names, specific references and financial figures individualized to each recipient provider.
Provider reactions to the new rule from the Centers for Medicare & Medicaid services have largely maintained a united front — calling the mandate unfunded, one-size-fits all and shortsighted about the workforce shortage crisis going on in the long-term care sector.
For-profit and nonprofit leaders alike called into question how nursing homes will pay for a mandate that only a small fraction of facilities could currently meet with funding tightly controlled by the government.
Ensign Group CEO Barry Port declined to comment at length Monday, but he told McKnight’s Long-Term Care News that the company is drafting a response to the lawmakers’ letter. Ensign is among the nation’s largest skilled nursing providers, with 310 healthcare operations, the vast majority of them nursing homes, across 14 states. The company has a history of buying poor performing facilities and improving their care quality and financial health.
McKnight’s also attempted to garner comment from National HealthCare Corp. CEO Stephen Flatt Monday and from Brookdale Senior Living but received no response from either by deadline.
Policymakers’ demands
Sunday’s letters suggest that nursing homes’ workforce shortages and high turnover rates could be due to large providers’ business practices.
“Turnover is high due to poor working conditions, understaffing of facilities, and low pay – conditions that you are in position to rectify,” the lawmakers wrote to the providers. “CMS’ new rule to set a minimum staffing standard would make these jobs more attractive to workers.”
The three providers under the policymakers’ scrutiny spent a combined $420 million on stock buybacks and $220 million on executive pay between 2018 and 2023, the letters claim. They also highlighted reporting that some providers hide profits through related-party transactions in a process known as tunneling.
The congressional leaders demanded transparency about the rationale behind these expenses compared to what has been invested in staff salaries. They also asked for details on any additional spending on advocacy in recent years — including advocacy against the staffing mandate.
Communication between long-term care providers and policymakers continues to be especially confrontational in the wake of the controversial staffing mandate. In an open letter last week, the president and CEO of nonprofit association LeadingAge called for an end to “incendiary” characterizations of the industry from the Biden administration and a renewed focus on collaborative solutions to address the industry’s challenges.
Senior Editor Kimberly Marselas contributed to this article.
Read more about the inquiry as relates to Brookdale Senior Living in sister publication McKnight’s Senior Living.
