The National Consumer Voice for Quality Long-Term Care, March 28, 2023
Last week, Consumer Voice released its new report, “Where Do the Billions of Dollars Go? A Look at Nursing Home Related Party Transactions,” which documents how each year nursing homes funnel billions of dollars through related party companies (companies they own) with little to no oversight by the Centers for Medicare & Medicaid Services (CMS). The report provides a detailed look at related parties and how nursing homes potentially use them to hide how much money they are making and to give the illusion that their facilities are not profitable.
The report uses cost data submitted to the federal government by nursing homes to illustrate the industry-wide practice of related party transactions and how at the same time, residents face inadequate staffing and poor care.
The report found:
- Despite billions of dollars being funneled through related party companies each year, there appears to be little to no scrutiny by the federal government on how this money is spent.
- Nursing home owners and operators routinely pay their related parties more than the reported costs, in some instances by nearly 1200%.
- Related parties make nursing homes look less profitable, while a closer look at the parties involved reveals that profits may be hidden in these transactions.
- Cost reports do not capture enough information on related party transactions to enable CMS to fulfill its regulatory obligation to ensure taxpayer dollars are going towards care and not profits to owners and operators.
The constant refrain from the nursing home industry is that they need more money. Yet, the report shows that billions of dollars go unaccounted for each year and are potentially being siphoned off to the profits of nursing home owners and operators. In the report, Consumer Voice offers solutions to the lack of transparency and accountability for how nursing home dollars are spent. CMS must take action now to ensure that taxpayer dollars are spent on care and that the safety and well-being nursing home residents is assured.
Join the webinar Thursday, April 6th to hear more about the report in detail