An East coast-based employee union is accusing a nursing home chain of using related-party transactions to increase profits instead of appropriately providing for residents and workers.
Leaders with 1199SEIU United Healthcare Workers East levied the “related-party transaction” allegations over the weekend during multiple protests outside of several facilities owned by Elderwood.
The operator owns more than 30 skilled nursing and assisted living facilities throughout New York, Vermont and Rhode Island.
Elderwood did not respond to a request for comment from McKnight’s Long-Term Care News Wednesday by production deadline. An Elderwood spokesman declined to comment to local media on the company’s financial transactions over the weekend.
Related-party transactions involve a deal, arrangement or relationship between two related parties for the transfer of resources, services or obligations. The union said the practice is used by for-profit nursing home owners who also own other companies that supply related services needed to run facilities solely for the purpose of charging for those services.
“We see it often in large for-profit chains with multiple facilities,” Dennis Short, a senior policy analyst for 1199SEIU, told local media during a weekend protest. “They create related parties, other companies, to siphon funds not otherwise committed to provide to the facilities.”
Short added that it prevents outsiders from knowing the true income of nursing homes. The group is also pushing for higher wages and better staffing for workers.