NEW YORK, NY, March 04, 2013 /24-7PressRelease/ — Not all nursing homes are the same. As with any type of institution, some are good and others are not so good. Some provide marginal care while others regularly overbill the government for services provided to Medicare and Medicaid patients. It turns out that some types of facilities are more likely to overbill and provide sub-standard care than others.
In particular, for-profit nursing homes submit more invalid claims to the federal government. Bloomberg News requested data on nursing homes from the U.S. Department of Health and Human Services. It found that 30 percent of claims submitted by for-profit homes were found to be improper; only 12 percent of claims from nonprofit nursing homes were improper.
The growing number of for-profit nursing homes appears to be adding to the problems of waste, fraud and abuse that plague many nursing homes. This growth appears to be part of a trend. In 2002, for example, for-profit nursing homes collected 72 percent of revenues in that industry sector. In 2010, 78 percent of the $105 billion went to for-profit organizations. This trend is not limited to nursing homes.
For-profit companies operate 96 percent of U.S. outpatient surgery centers. This number represents a 33.3 percent increase since 2004. The number of for-profit hospices is now more than half of all such facilities in the U.S. More than 80 percent of dialysis clinics and home-health care agencies are operated by for-profits.
Hospitals are seemingly exempt from this trend – almost 90 percent of hospitals were operated by nonprofits and government agencies in 2010. However, private investors have been eyeing hospitals as a possible next step as they seek ever-greater returns.
Does overbilling by for-profit nursing homes really hurt anyone directly? The short answer is “Yes.” By depleting limited resources for care, overbilling can prevent the elderly that depend on nursing home care from obtaining the services they need.
In addition, for-profit nursing homes are very aggressive when it comes to managing costs. This puts patients at risk. For example, the 10 largest for-profit nursing home chains employed 37 percent fewer registered nurses than nonprofit and government-run facilities between 2003 and 2008. The chains received 59 percent more inspection deficiency reports than organizations in the nonprofit category. Since the study detailing this situation was released in 2009, for-profit nursing homes are reported to have improved the nurse-patient ratio, according to Greg Crist, spokesman for the American Health Care Association, a trade group. However, they have some catching up to do before they are the equal of nonprofit and government nursing homes.
The result of the cost-cutting and overbilling is that investor-owned private facilities earn a 20 percent profit, money that is returned to investors rather than used for the care of patients, as it is in a not-for-profit or government-run facility.
New York State Public Health Law 2801 provides elderly residents of nursing homes and their families the ability to seek justice when they are harmed because of abuse or neglect. This is especially important when the facility involved is a for-profit nursing home. Because money is their primary reason for existing, such nursing homes respond best when they face legal action and the possibility of damage awards.
When a jury holds a nursing home accountable for the injuries and harm it caused, it is sending an important message to others in the industry: Substandard care, abuse and neglect of the elderly will not be tolerated. The legal system has an important role to play in keeping our elderly loved ones safe while in nursing homes.
If you see abuse or neglect in a nursing home, report it.