For-profit US care homes ‘decimated’ by coronavirus

It was around 5pm when Margaret Boyce began feeling run down, she recalled. Ms Boyce, a certified nursing assistant at a care home in Edison, New Jersey, was just two hours into her 3pm to 11pm shift. She barely ate dinner that evening but managed to carry on, tending to elderly residents, one after the next, until quitting time.

“I’m the one responsible for them getting fed, getting dressed — all their daily needs,” Ms Boyce, 61, said of her job. 

The next day, she and a co-worker were both running high fevers and they were soon diagnosed with coronavirus. She is now recovering at home, yet another member of the growing ranks of low-paid but essential nursing home workers who have fallen sick during the outbreak.

Jon Dolan, the president of the Health Care Association of New Jersey, estimated that a third of staff have fallen ill at the state’s nursing homes and another third had abandoned their posts, leaving a valiant few to try to care for residents.

“We’re being decimated,” said Mr Dolan, who has pleaded for the National Guard to be deployed to assist stricken nursing homes. “The hospitals were the first front in the battle, and we’re the second.”

Nursing homes and adult care centres have emerged as the most dangerous terrain in the US coronavirus outbreak. In New York alone, they have reported 4,800 deaths — including 1,700 revealed on Tuesday as state authorities updated their figures.

That nursing homes would be ravaged by the virus may have been inevitable. They pack large numbers of vulnerable residents together, and care for them with low-paid workers — many of whom take public transport to work. Well-respected and poorly regarded nursing homes have suffered alike.

Policies in New York obligating nursing homes to accept coronavirus patients — presumably to ease the burden on crowded hospitals — also did not help, say critics.

Yet to some who have studied US nursing homes, the severity of the crisis was not preordained. Rather, they argue, a largely for-profit industry has for years been putting a strain on its workers to improve its financial performance. By the time coronavirus arrived, they say, the industry was ill-equipped to face it.

“Nursing homes are the weak link in our healthcare system, and we’ve allowed it,” said Charlene Harrington, a professor at the nursing school at University of California, San Francisco. “It’s just been a disaster in the making.”

There are raging debates about whether profit-seeking owners or a lack of government support are to blame. Underlining these is a widespread belief that nursing homes are less of a priority than other parts of the healthcare system. Or as Ms Harrington put it: “We think, ‘these people are going to die anyway’.”

As evidence, she points to a study by researchers at Harvard and Vanderbilt universities that found three-quarters of US nursing homes were understaffed before coronavirus. That, in turn, leads to less care for patients, and an increase in maladies such as bed sores, infections and even abuse.

The financial rationale for cutting staff was described in a study published in February by Atul Gupta, an economist at University of Pennsylvania, that focuses on private equity’s growing investments in healthcare. Because nursing homes are paid set fees by Medicare and Medicaid, the government-run healthcare programmes, on a per-patient basis, Mr Gupta and his co-authors found that owners were incentivised to maximise the number of patients in their facilities and then reduce staff.

“Cutting costs is the primary mechanism by which a nursing home may increase per-patient profit,” the authors concluded, citing “robust evidence” of reductions to nursing staff after private equity buyouts.

A patient is loaded into an ambulance by emergency medical workers outside Cobble Hill Health Center in Brooklyn, New York © AP

The cuts tend to fall on certified nursing assistants, who are less skilled — and less regulated — than registered nurses but ultimately handle most day-to-day chores. As their ranks are depleted, those who remain face a heavier burden, according to Rebecca Kolins Givan, a management professor at Rutgers University who studies healthcare. “It’s a really physically and emotionally demanding job for very low wages.”

One nursing assistant, who asked not to be identified, said when the ownership of her facility changed the CNA ranks on her floor were cut from eight to six — and sometimes to four when people fell ill. They still had to care for 60 residents, whom they fed, bathed and helped to the toilet.

“The most important thing was to keep the patient clean and dry,” said the woman, who earned $14 an hour.

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When coronavirus struck, there was not enough protective equipment to go around. The woman eventually left her job, she said, fearing she would become infected and endanger her child.

In Maryland, Dartanya Rosebud, a cook at a Baltimore nursing home, would like to quit. As residents and staff have fallen ill in recent weeks, Ms Rosebud said management had refused to level with the staff. “We don’t know who’s infected and who’s not,” she said, adding: “Just because we signed up to be in nursing doesn’t mean we signed up to be in a pandemic.” 

Her $16.41-an-hour job helps to support her daughter and two grandchildren. And so Ms Rosebud goes into work each day, having her temperature taken at the door and then collecting a bag with her allotment of face masks. “I just can’t afford to stay home,” she said.

Several states have debated legislation that would require nursing homes to maintain a certain ratio of certified nursing assistants to patients. In New Jersey the most recent effort failed last year.

Investors have been drawn to nursing homes by the simple logic of demographics. The ageing of the baby-boomer generation is expected to drive up demand for all forms of senior care in the coming years.

But the bankruptcy two years ago of HCR ManorCare, one of the largest US nursing home chains, was a warning about the potential perils. The Carlyle Group paid $6.3bn for ManorCare in a leveraged buyout in 2007. A few years later it sold its vast real estate holdings. Forced to pay escalating rent, ManorCare filed for bankruptcy in 2018. Carlyle executives blamed its failure on changes to government reimbursement payments as a result of Barack Obama’s Affordable Care Act.

At about the same time, one of the most infamous “for-profit” nursing home scandals was unfolding at Skyline Healthcare. Founded in 2015 by Joseph Schwartz and his wife Rosie, it grew from three nursing homes to more than a hundred across the country in two years.

The Schwartzs, who ran Skyline from atop a pizzeria in Wood-Ridge, New Jersey, followed a common practice of splitting up their homes into separate real estate and operating companies. That makes it neater for passive investors in the sector. To Ms Harrington and other sceptics, it also makes it easier to conceal profits and avoid liability. Skyline collapsed in 2018 after four states took over its homes out of fear for residents’ safety.

Their son, Louis Schwartz, is an officer at Andover Subacute, the New Jersey nursing home where an anonymous tip led to the discovery last month of 18 corpses stacked up in a makeshift morgue. 

Steve Monroe, managing editor at Irving Levin Associates, a publishing company that specialises in senior care investments, argued that overall the industry was more professional than it was 30 years ago. Still, in a recent editorial in the SeniorCare Investor, the Irving Levin newsletter that is the industry bible, he acknowledged the need to increase wages.

“Like it or not, labour costs have to rise. Forget the ethical reasons (meaning no one can really ‘live’ on $10 per hour), which should be obvious, but they need to rise in order to operate a sustainable business with qualified staff,” he wrote.

In the meantime, authorities are threatening more scrutiny. New York’s attorney-general has launched an investigation into nursing homes and their response to coronavirus. 

Ron Kim, a state assemblyman from the hard-hit New York City borough of Queens, has proposed legislation that would make it easier for New York state to take over homes that do not meet minimum obligations.

“They will extract as much money as possible from Medicaid without spending a dime more on [protective equipment] or staff,” said Mr Kim, who has been fielding calls from frantic constituents unable to contact their parents at locked-down nursing homes. 

When one finally got through, they were told their father was out for a walk — except the man was wheelchair bound. “It’s shocking,” said Mr Kim.

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