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Editorial Misses Mark On Nursing Home

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By WILLIAM S. PHELAN

Published: October 17, 2007

Reading the Oct. 8 Tampa Tribune editorial 'Florida Needs to Scrutinize For-Profit Nursing Home Industry,' one could wonder if the newspaper itself doesn't long for what it called 'the go-go days' of the 1990s.

Back then, Florida nursing homes were deluged with lawsuits that enriched trial lawyers and put about a fourth of the state's facilities in Chapter 11. A favorite tactic of the trial lawyers and their paid advocates was to publicly demonize long-term caregivers as uncaring and greedy. They reserved their harshest words for those facilities owned by publicly traded and self-insured companies in order to leverage larger settlements.

Those targeted nursing home companies soon fled the state. Right behind them were many of the state's liability insurers. Today, few insurers remain and fewer have since returned. In 2001, the Florida Legislature found the spate of lawsuits had become a separate problem and that suing nursing homes into insolvency did nothing to improve care. The landmark elder care legislation it overwhelmingly approved wisely required increased direct-care staffing (now the highest in the nation) and improvement programs that have since dramatically improved care. Why turn back the clock?

Now comes a New York Times story - which the Tampa Tribune unquestioningly accepted as true - that asserts a Tampa nursing home cut both staffing and other costs after it was acquired by a private investment company. In fact, the new owner spent about $330,000 on capital improvements within three months of purchase and increased, not reduced, direct nursing care staff. Evident is the reporter's fundamental misunderstanding of Medicaid cost reporting; of the new federal Quality Measures; of the state's Nursing Home Guide; and of the covert role currently being played by a national labor union that has targeted these acquisitions for its own purposes.

Didn't anybody even think to ask why nursing homes have turned to private equity firms in the first place? Simple reason: They are one of the few remaining sources of capital. The newspapers' readers would have been better served by a more knowledgeable and thorough portrayal.

Well-meaning journalists and newspaper editorialists would also do well to first learn the basics of how nursing homes, both nonprofit and those privately held, operate as businesses and how all must make a profit in order to remain in business. Understand they have every incentive to go well beyond the minimum staffing levels, as most do, and to deliver a quality of care the elderly patients expect and deserve. Most important, realize nursing homes must be adequately reimbursed by Medicare and Medicaid for the care they provide. Otherwise, these may become known as the 'gone-gone days.'

William J. Phelan is executive director of the Florida Health Care Association, the state's first and largest advocate for long term care facilities and the elderly they serve.

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