Providers accused of profit-hiding schemes

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Nursing homes have come under fire for creating limited liability corporations that funnel profits to transportation companies and other aligned firms.
Nursing homes have come under fire for creating limited liability corporations that funnel profits to transportation companies and other aligned firms.

Nursing home critics are driving for deeper investigation into how operators “reward” themselves with lucrative self-dealing contracts while allegedly keeping staffing levels low.

A Kaiser Health News review of federal inspection and quality records found that nearly three- quarters of U.S. nursing homes are involved in “related party transactions,” often routing proceeds to sister companies, a legal practice.

Nursing homes that outsource to related organizations often have fewer nurses and aides per patient, higher patient injury rates and almost twice the number of complaints as independent facilities, the Dec. 31 report said.

“Almost every single one of these chains is doing the same thing,” said Charlene Harrington, RN, Ph.D., a long-time nursing home staffing critic and professor emeritus of the School of Nursing at the University of California-San Francisco. “They're just pulling money away from staffing.”