For-Profit Nursing Homes May Abuse COVID Relief Funds

abuse of covid-19 relief funds

Some U.S. Nursing Home Providers Will Misuse COVID Relief Funds

A revealing story published in the Washington Post shows that many for-profit nursing homes across the U.S., received hundreds of millions of dollars in COVID relief by The Health Resources and Services Administration (HRSA). The funds were intended to be shared to help health care workers and nursing home residents address pandemic-related shortcomings in care, but came with few spending restrictions. Unfortunately, some for-profit owners may take advantage of the support rather than spend the money on necessities such as personal protective equipment or hazard pay for nurses and aides caring for residents battling COVID-19.

According to Health and Human Services (HHS):

  • A government press release said the agency distributed $175 billion through the Provider Relief Fund aimed to help health care services, including skilled nursing facilities (SNFs) such as nursing homes and long-term care facilities. Included in the fund was a targeted nursing home distribution of $4.9 billion and about $2.7 million in general distribution payments.
  • Each SNF received a fixed allocation of $50,000, plus a distribution of $2,500 per bed. All certified SNFs with six or more certified beds were eligible for this targeted distribution.
  • The average distribution was $315,000, with some of the more prominent, for-profit facilities receiving $3 million or more.
  • HHS said in guidance to the industry, the money did “not need to be specific to providing care for possible or actual coronavirus patients.”
  • Providers were permitted to use the grants for a range of expenses, including health insurance, rent or mortgage payments, and equipment lease payments.
  • There was no formal financial assessment of nursing homes and their parent companies before distributing the payments.
  • Nursing home recipients had to agree that they will only use Provider Relief Fund payments for permissible purposes, and agree to comply with future government audit and reporting requirements.

The Washington Post report analyzed more than 2,000 homes and suggested that for-profit owners of large nursing home chains were mostly the recipients, many with the most shameful and damaging quality ratings. Although The Post could not independently verify how the relief payments were spent, elder care advocates say the federal money will instead be used to pad personal pocketbooks and skip out on supporting frontline workers and resident needs during such a disastrous time.

For-Profit Homes Leave a Trail of Fraud, Violations, and Failures in Patient Care

Many of the large for-profit nursing home providers who received the funds, some owned by private equity and other investment firms, have an unforgiveable history of Medicare fraud and improper billing, labor violations, forged legal documents, or widespread failures in patient care that lead to nursing home abuse and neglect. For example, nursing home companies recently sued for Medicare fraud received more than $300 million in relief payments.

According to the newspaper’s review of the federal data:

  • National nursing home chain, SavaSeniorCare, received more than $65 million in pandemic relief aid. The group is in active litigation after being accused of putting elderly residents into unnecessary therapy services and delaying patients’ release to reap higher Medicare payments.
  • More than $35 million went to homes operated by the for-profit Brius. According to The Post, officials at four Brius homes previously acknowledged in federal court that “employees used corporate credit cards to buy massages, tickets to sporting events and excursions on the 222-foot mega yacht Inspiration Hornblower for hospital planners who provided patient referrals. The four homes eventually repaid $6.9 million through a settlement.”
  • Two homes that are part of the for-profit SentosaCare received more than $2 million in pandemic relief payments. Owners of the company were liable for “violations of human-trafficking laws after Filipino nurses brought to the United States to work in the two homes said they were overworked, improperly paid and threatened with $25,000 fines if they quit before their contracts ended,” said The Post report.
  • The Life Care Center of Kirkland received nearly $320,000 in pandemic relief even though inspectors said the home did not properly care for sick residents or alert authorities of the nation’s first coronavirus outbreak at a U.S. nursing home. Altogether, Life Care network homes still received more than $48 million in pandemic relief payments. The system operates more than 200 nursing homes and is now being monitored by federal authorities for financial compliance with Medicare rules.

As thousands of elderly residents continue to fall ill or die, the nursing home industry should be using any financial relief to prevent further turmoil. Testing supplies, protective gear such as surgical gowns and masks, payroll for increased staffing, and money to support lost revenue related to COVID-19 should not be undercut to cover other expenses. There should have been more restrictions on how the money was or will be spent.

HHS said that providers unable to show that money went to expenses or lost revenue attributed to the coronavirus could be forced to return some or all of the funds. The first reporting instructions and a data collection template with the necessary data elements will be available on August 17, 2020, and the reporting system will become available on October 1, 2020. The Illinois nursing home abuse and neglect attorneys at Levin & Perconti will follow those reports as they become public and share our findings here on our weekly blog.

Report Nursing Home Abuse & Neglect Concerns

If someone you love has been the victim of abuse or neglect in a nursing home, rehabilitation center, or a long or short-term care facility, the nursing home abuse and neglect attorneys of Levin & Perconti want to help. And if you suspect a nursing home’s practices have contributed to the decline of a loved one’s health or put them in danger during this unprecedented time, please contact us for a free consultation. Call us at 877-374-1417 or 312-332-2872 to speak with one of our experienced nursing home negligence lawyers in Illinois. You will never pay any fees unless we successfully resolve your claim.

Also read: COVID Supplies Run Low At U.S. Nursing Homes



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