The public push for more oversight of private equity nursing homes may be warranted, according to a new JAMA Network study that found for-profit facilities were associated with higher costs and more hospital visits.
“Policymakers might consider making more detailed ownership information available in outlets that provide consumers with information on nursing home quality, such as Nursing Home Compare,” study authors Robert Tyler Braun, Ph.D., Hye-Young Jung, Ph.D., Lawrence P. Casalino, MD, and others concluded.
Investigators, using data from 302 private equity-backed nursing homes between 2013 and 2017, found that long-stay residents at privately-owned facilities were 11.1% more likely to visit the emergency room with ambulatory sensitive conditions, and 8.7% more likely to be hospitalized when compared to non-privately owned entities.
Additionally, residents at for-profit nursing homes had 3.9% higher Medicare costs, which were about $1,080 annually per resident.
Researchers, however, found no differences between privately-owned nursing homes and non-private facilities regarding residents receiving antipsychotics, developing a pressure ulcer or experiencing severe pain.
The findings come months after critics put nursing homes in their targets with spring congressional hearings that preceded a summer of discontent.
The team added that it’s difficult for consumers to identify private equity-backed facilities and compare them to other types of nursing homes due to a lack of transparency in ownership data. That, along with their findings, “suggest that more stringent oversight and reporting of related entities may be warranted,” they wrote.
“Private equity firms frequently use complex corporate structures that make it difficult to identify related third parties,” investigators concluded. “Tracking the amount of revenue for staffing, services, and supplies that goes to multiple related or co-owned entities that appear in PECOS as having ownership stakes in a nursing home is often not possible.”