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Drug CEOs Prioritize Cash Over Nursing Home Resident Care

The Wall Street Journal recently published an article that shed light on a widespread problem that plagues the care given to nursing home residents everywhere: corrupt deals between nursing home administrators and drug companies.

The article focuses on Joel Gemunder, the former CEO of Omnicare, the largest distributor of pharmaceuticals to nursing homes. Mr. Gemunder officially announced his retirement last week, taking almost $130 million in pension benefits on his way out. The amount is a staggering sum of money for a single individual, especially considering that the stock value of the company he is leaving dropped over 60% in his final years running the enterprise.

The mammoth pension amount is consistent with how Omnicare has prioritized values: cash over quality–profits over care. Over the course of its history, the company has even shown a willingness to break the law in order to make as much money as possible. A recent Chicago example has made headlines.

As has previously been reported on this blog, Chicago nursing home magnet Morris Esformes sold his company, Total Pharmacy, to Omnicare several years ago. Recent records have uncovered that during the sale process, Mr. Esformes illegally took kickback money from Omnicare to ensure that certain pharmacy contracts would remain in place following the sale. Besides being an illegal dedication of Medicare and Medicaid funds, these practices trivialize nursing home care.

Instead of making pharmaceutical choices based on quality and need, these practices treat senior medication as if it were merely a way to maximize profits. Our senior nursing home residents should receive the best medication possible targeted directly to their need. However, as this story indicates, Chicago nursing home operators and large drug companies are collectively using our nursing home residents as means to increase their own wallet size.

Our Chicago nursing home attorneys at Levin & Perconti support the simple values of quality and balance in nursing home care. It should not be a controversial position to believe that the most important goal of nursing home operators is to provide the best care possible to the residents in their facility. Sadly, quality care continues to take a backseat to profits at many Chicago nursing homes.

If you know of an incident at a facility near you, please contact our offices and learn how we can help.