More transparency regarding nursing home ownership and how profits are spent will be needed if the industry wants to successfully move forward from the COVID-19 pandemic, according to a top expert.
“These issues, if we’re not transparent with them, if we don’t see them,are going to continue to eat away at the potential success of the nursing home industry,” geriatrician Michael Wasserman, M.D., said.
“The system is set up to be opaque. We need more clarity, we need more transparency, we need to all be able to look in the mirror and know who’s responsible for what,” he added.
Wasserman spoke on Tuesday during the SimpleLTC Virtual Symposium. The discussion centered on challenges within the long-term care system, like financial challenges and care quality concerns, that were exacerbated by the COVID-19 pandemic, and solutions it will take to overcome the obstacles.
He stressed that it’s important for people to first understand the interplay between nursing home ownership, real estate and related companies that may be owned by operators, like medical supply companies and medical staffing agencies, and how that may impact the overall bottom line for facilities.
Stricter cost report audits are needed in order for more transparency, he said. He also noted that industry stakeholders must fully recognize the role of real estate ownership and how owners can use the nursing home buildings as collateral to borrow more money without having to use the additional funding on care.
“I like to look at nursing homes as a three-legged stool and the three legs are: finance, operations and clinical. We will only achieve quality and financial viability when all three legs of the stool have equal value and have equal strength,” he said. “Is the clinical component given equal weight as the financial and operation?”
The impact of profit motives in long-term care and how they ultimately impact the day-to-day operations of facilities must also be examined, he explained.
“How much of this money was spent on capital improvements? How much of this money is spent on improving quality? How much of this money was spent in the early days of the pandemic to get [personal protective equipment] and testing into buildings?” he posed. “I think that’s a very important question to pose to folks.”