Illustration by David Lafata/Advance Local
- The Context
- State of the State
Illustration by David Lafata/Advance Local
Terri Smith said she still remembers how drab and lifeless the nursing home looked.
The home, Golden LivingCenter-Camp Hill, was one of the few that had available beds for her ailing brother, Robert.
“It looked like a rundown hospital,” she said. “It was heartbreaking for me because I couldn’t change it. I didn’t have the financial wherewithal to get him out of there.”
In 2013, Smith’s brother died. Smith said she still regrets that his final days were spent in a facility that left him so depressed.
Her experience wasn’t isolated. For years, families had complained about care at Golden Living nursing homes. The Arkansas-based company, formerly the largest nursing home chain in the nation, had been racked by lawsuits and regulatory violations for a laundry list of problems: Poor training, medication errors, skeletal staffing, and even resident deaths.
“When you say ‘Golden Living’ people just suck in air,” Smith said. “It’s a scary word. It’s almost like a bad word.”
But in 2015, in Pennsylvania at least, elder care advocates believed the company’s history might finally be catching up with it.
In a move with little precedent nationally, Kathleen Kane, Pennsylvania’s attorney general at the time, sued Golden Living for chronic understaffing and failing to provide basic care. Her office sued several nursing home chains but Golden Living, with $3 billion in annual revenue and 300 homes across the nation, was the biggest target.
It spurred a groundswell: The state Health Department – long criticized by elder care advocates for lax oversight – pledged to get tougher on bad homes. Golden Living transferred its 36 Pennsylvania nursing home licenses to other chains. State Attorney General Josh Shapiro is continuing to pursue the state’s suit against Golden Living.
For some families, the changes, they said, led them to place loved ones in homes they might never have otherwise.
“We thought there was no way they could not have improved because there’s so much oversight by the state,” said Rick Mantheiy of Derry Township, who placed his mother in a former Golden Living home in East Pennsboro Township in 2017.
But a PennLive investigation found most of these homes are still offering substandard care. Those problems, advocates said, show state regulators aren’t doing nearly enough to protect the 90,000 residents in Pennsylvania’s nursing homes.
PennLive examined care-related problems at the homes formerly managed by Golden Living. One year after the sale, nearly two-thirds of those homes were cited just as often or more frequently for care-related problems. The East Pennsboro facility that cared for Mantheiy’s mother was the fourth most cited home in the nation in 2017.
The state said it found issues including supervisory failures that harmed residents, unsanitary conditions, insect infestations and falsified records. Overall, PennLive found managers at the nursing homes made virtually no changes to the one element that experts said is most critical to good care: staffing levels.
Heather McCleaf-Royle’s 72-year-old mother spent eight months in the same former Golden Living home as Rick Mantheiy’s mother.
“I firmly believe that the care they have provided her is negligent,” said McCleaf-Royle of New Cumberland. “If you want your loved one’s basic needs and dignity needs met, don’t put them there.”
Meanwhile, an operator of seven former Golden Living homes, Skyline Healthcare, faced such crippling financial issues in April that the state had to take emergency control of its homes. The licenses have since been transferred to new owners.
Those problems, experts and advocates told PennLive, highlight an array of oversight problems in Pennsylvania. State regulators have failed to thoroughly vet new nursing home applicants, critics said. Advocates said Pennsylvania must update its standards for minimum staffing and issue tougher penalties on homes for providing bad care.
In response to PennLive’s findings, Gov. Tom Wolf’s administration said it cares deeply about the state’s nursing home residents. The administration also said it hopes to release tougher regulations – including a revised minimum staffing standard – before the end of the year.
“At the Department of Health, our role is to enforce the laws and regulations, and ensure that nursing home operators and owners are meeting those obligations,” said Nate Wardle, an agency spokesman. “We hold nursing home operators and owners accountable for meeting the requirements of the law.”
But advocates and experts said PennLive’s findings show the administration is taking too long to make changes. Beyond that, they added, the state could make important changes with better enforcement of existing regulations.
Until something changes, they said, the costs will continue to be borne by some of Pennsylvania’s most fragile citizens.
“They should be better,” said Diane Menio, executive director of CARIE, a Philadelphia-based advocacy organization. “I don’t know why you get into a business without the intention of providing quality.”
Among the homes formerly run by Golden Living, few may exemplify those problems better than those now managed by Priority Healthcare Group.
The New York chain was founded in 2015 by David Gamzeh and Akiva Glatzer. The pair bought the licenses of 11 Golden Living homes in February 2017 – most of them based in central Pennsylvania.
Like the other three chains that bought Golden Living’s licenses, Golden Living continues to own the real estate. In essence, Priority functions as a tenant of Golden Living and manages its facilities.
Golden Living’s ownership interest is largely invisible to an outside observer. Like the other buyers of Golden Living’s licenses, Priority shed Golden Living’s signs and rebranded its homes.
Priority also made it clear it intended to provide a different standard of care than Golden Living.
“When Priority Healthcare looks at a facility, even one that is struggling, we look for an opportunity to improve the facility,” Michael Fragin, a company spokesman, told the Reading Eagle in 2017. “That is our goal.”
That promise doesn’t appear to have become a reality.
Of the 11 former Golden Living homes that Priority Healthcare Group manages, all but three had more state citations in 2017 for care-related problems than they did under Golden Living in 2016.
Perhaps more telling, staffing levels have fallen from already low levels under Golden Living. In some homes, staffing was 15 percent lower in the second half of 2017 compared to the prior year under Golden Living, PennLive found.
On certain days in 2017, its homes were so understaffed that they fell below Pennsylvania’s minimum staffing standard, according to federal data.
Priority Healthcare Group has declined repeatedly over the past year to discuss its citation numbers but insisted its staffing ratios met Pennsylvania’s minimum requirements.
Fragin stressed the chain is dedicated to providing quality care. “PHG will continue its commitment to improve patient care and the resident experience in all its facilities across the state,” he wrote in a statement.
But PennLive’s investigation suggests the company has functioned almost identically to Golden Living. Its findings came from hundreds of pages of inspection reports and interviews with more than a dozen people inside the homes, including nurses, residents and families.
“The name changed but everything in the facility stayed the same,” a registered nurse who formerly worked in one of the company’s homes told PennLive. “How they ran things, how they staffed things – things never got any better.”
The registered nurse, who requested anonymity, told PennLive that Priority has taken an even more aggressive approach to cost-cutting than Golden Living.
Staffing levels were so skeletal at her former home, the nurse said, that she couldn’t let staff go out to lunch because she feared residents would be in danger.
“Some of these girls are caring for 15 people,” the nurse said. “That’s insane. It’s not safe.”
Orientation for new nurses was also briefer than it was under Golden Living, she said. She feared that also was placing residents in jeopardy.
The nurse recalled a 2017 incident where a resident was struggling to breathe. She said other nurses didn’t know how to clear a blockage in his tracheostomy tube.
“No one knew what to do except me,” she said. “If I hadn’t been there, he probably would have died.”
Fragin, Priority’s spokesman, told PennLive the nurse’s statements were only her opinion and that staff was adequately trained.
“The opinions of an anonymous employee do not accurately portray the reality at any facility operated by Priority Health Group,” Fragin said.
The Gardens at West Shore provides a vivid example of how care has changed under Priority.
The East Pennsboro home, formerly known as Golden Living Center-West Shore, already had a grim reputation. State inspectors issued 37 care-related citations in 2016 – the highest for any Golden Living home in Pennsylvania that year.
In a well-publicized 2015 incident, state inspectors said they discovered maggots had developed in a resident’s feeding tube.
The home’s citations have nearly doubled since Priority took over. In 2017, the home was cited 68 times, the fourth-highest among the nation’s 15,000 nursing homes.
In May 2018, the federal government deemed the home a “special focus facility” – a designation shared by roughly 100 homes across the nation that have consistently failed to improve.
Inspection reports detail a litany of problems including: unhygienic conditions, poor infection controls and shortages of basic supplies such as toilet paper. In one case, evidence showed staff falsified records about how much residents with dementia were eating.
In another incident, a psychotic resident assaulted another resident, leaving the victim with severe head trauma. The state found the home failed to supervise the resident, who had a history of aggressive behavior. It found the home didn’t investigate or report the assault. The Gardens at West Shore was fined $82,000.
But families and residents interviewed by PennLive said those citations provide only a glimpse of what care is like at former Golden Living homes.
“That place should not have anybody in it,” said James Hoover of Enola, who said he placed his disabled adult son at The Gardens at West Shore for two weeks in February 2018. “They don’t take care of them. They get no attention like they should.”
Maggie Whipple of Harrisburg, a retired nurse, has extensive experience with The Gardens at West Shore.
About four years ago, she said her family placed her 90-year-old mother at the home when it was run by Golden Living.
Whipple said her mother’s belongings constantly went missing and she became groggy due to what Whipple said she believed was overmedication.
The home appeared chronically understaffed, Whipple said, and many nurses appeared to be poorly trained and apathetic. In her first two months, her mother fell out of her wheelchair twice, Whipple said.
“I found my mother with two black eyes,” she said. “Her face was black.”
Whipple said she wanted to move her mother to a different home but couldn’t because she didn’t have power of attorney.
When Priority took over in February 2017, Whipple said she saw signs of improvement. She said the company repainted walls, renovated floors and brought in nurses that were kinder than those who worked for Golden Living.
Beyond that, Whipple said, basic care never changed.
“It’s like lipstick on a pig,” she said.
In addition to bare-bones staffing, Whipple said, Priority had made subtler cuts. The facility shifted to lower quality washcloths, bedsheets and toilet paper, she said.
It also appeared to cut back on cleaning, Whipple said.
In one incident, Whipple said she discovered her mother’s sheets were covered with hundreds of termite-like bugs.
After complaining to an administrator, Whipple said the home temporarily moved her mother and her roommate and sprayed their room with insecticide.
She said the home returned them to their room the next day – even though it was still coated with insecticide and half-dead insects.
“It was horrible,” Whipple said. “It was so unprofessional, so unsanitary. It was a mess.”
Inspectors cited the home for ignoring a pest control company’s warning of the potential for infestation if it didn’t take preventive action.
Other families interviewed by PennLive described similar situations at The Gardens at West Shore. Some said they feared for the lives of their loved ones.
Heather McCleaf-Royle said she had initially been impressed by the home.
The New Cumberland woman said she needed short-term housing for her 72-year old mother following health issues in November 2017. Like many families PennLive interviewed, McCleaf-Royle said the facility was one of the few in the area that had beds available on short notice.
After touring the home’s rehabilitation unit, she and her family said they felt the home seemed clean and well-run.
“On the surface, everything seemed fine,” she said.
After admission, McCleaf-Royle said her mother was placed in a different unit than the one the family toured. She said the care differed drastically from what they had seen.
McCleaf-Royle said her mother was frequently forced to lay in her waste for hours. Her family struggled to get basic information on her mother’s condition, she said, and the home routinely failed to inform her when her mother fell or became unresponsive.
On one occasion, McCleaf-Royle said she discovered her mother’s blood caked on the floor from a fall the night before.
“I had to track down someone who worked in the office and brought her to the room to show her,” she said.
McCleaf-Royle said she wanted to move her mother to a different home but, like other families PennLive interviewed, her hands were tied, she said. Higher quality homes in the Harrisburg area have long waiting lists for Medicaid-funded residents like her mother, McCleaf-Royle said.
“She didn’t have the money to go into a better place,” she said.
McCleaf-Royle’s family got her out of the home, but under alarming circumstances. In June 2018, McCleaf-Royle said her mother missed a heart procedure due to a scheduling mistake by The Gardens at West Shore.
Two days later, McCleaf-Royles said her mother was hospitalized and almost died after a partial aneurysm.
After she stabilized, the family said it finally moved her to a different home. McCleaf-Royle said her mother’s aneurysm might have been avoided if The Gardens at West Shore hadn’t made a scheduling error. She said the incident was another example of the home’s poor management.
She said she still worries about the residents in the home.
“There are people in there who I know don’t get visitors,” McCleaf-Royle said. “Who looks out for them?”
At least one family said failures at The Gardens at West Shore ultimately caused their loved one’s death.
After a month at the home, brothers Rick and Joe Mantheiy said they discovered their 68-year-old mother had developed a bed sore on her lower back.
The brothers said they believe the home’s failures to regularly monitor, reposition, and clean their mother caused the wound. Continued failures, they said, led it to grow into a 3-inch-wide hole that exposed her tailbone.
“It was terrible,” Joe Mantheiy said. “You see your mom in absolute pain and there’s nothing you can do for her except to apologize that this has happened to her.”
Two months after they removed their mother from the home, the Mantheiy family said she died from septic shock. They said the bed sore caused her death.
“The home just wasn’t safe,” said Ashley Mantheiy, Rick’s wife. “It just wasn’t safe.”
Priority Healthcare Group reiterated the company was dedicated to quality care at The Gardens at West Shore.
“We stand by our original statement that PHG has made progress and improvements in its Pennsylvania facilities,” Fragin said via email. “We, of course, will continue to invest and improve.”
Fragin said that any allegation the company caused the death of Joe and Rick Mantheiy’s mother was unfounded.
“The Gardens at West Shore aims to provide the highest level of care to all our residents and we take feedback from our patients and their families very seriously,” Fragin wrote.
PennLive’s analysis suggests the problems at The Gardens at West Shore are emblematic of wider issues across Golden Living’s former homes.
Twenty-two of the 36 homes had as many or more citations in 2017 as they did the year before the change in management. In addition, staffing levels at most homes were the same or lower in the second half of the year.
Two chains – CHMS Group, based in New York, and Guardian Elder Care, based in Brockway, Pa. – did not respond to repeated requests for comment.
Skyline Healthcare, based in New Jersey, defended its staffing levels.
“Skyline has always ensured that its patient to staff ratio was appropriate for the level of care its patients needed, and the various acuity required to run its centers,” spokesman Michael Kolowski said.
Elder care advocates and researchers said PennLive’s findings reflect oversight failures by the Wolf administration.
“It’s not just on the operators,” said Sam Brooks, an attorney with Community Legal Services Philadelphia. “It’s on the state as well.”
Conditions inside Golden Living’s former homes illustrate why Pennsylvania must require higher ratios of nurses to residents in nursing homes, Brooks said.
Pennsylvania requires nursing homes to provide at least two hours and 42 minutes of care for residents each day. That’s a far cry from the four hours and six minutes recommended by experts.
Brooks said PennLive’s findings also show that despite pledges by the state to crack down on bad nursing home care, penalties are too few and too weak.
Of the 104 inspections that led to citations for Golden Living’s former homes in 2017, the state issued 10 penalties, PennLive found.
In one case, the department fined a Tunkhannock home only $15,000 following a medication error it said caused a terminally-ill resident to overdose on painkillers and become unresponsive.
Brooks said that with such poor oversight, it’s not surprising for investors to buy struggling nursing homes and change nothing.
“They know that the Department of Health is not going to really enforce any of the regulations,” he said. “If the department changes the way it fines people, they might think twice about investing in these homes.”
Presented with PennLive’s findings, Nate Wardle, the Health Department’s press secretary, said the agency is dedicated to enforcing Pennsylvania law.
Wardle said the Wolf administration hoped to release a package of new nursing home regulations – including updating the state’s minimum staffing standard – by the end of the year.
“It has been established that Pennsylvania’s nursing home regulations need to be updated,” Wardle said. “We have been working to rewrite these regulations, but changing regulations takes time.”
Advocates said PennLive’s findings show those changes are taking too long to implement. They also said many oversight problems arise from the department’s failure to enforce existing regulations.
For instance, they said, even without new regulations, Pennsylvania can issue tougher penalties and deny nursing home licenses to companies that have dubious track records.
Among the chains that took over Golden Living’s homes, it’s unclear whether the department seriously vetted any before granting licenses.
An analysis of federal data on four out-of-state homes operated by Priority Healthcare Group revealed all but one was severely understaffed in 2016 based on metrics used by experts. Meanwhile, among the 25 homes Guardian Elder Care operated in 2015, PennLive found 16 were dangerously understaffed, according to the metrics.
PennLive found a Beaver County home operated by CHMS Group was so understaffed in 2014 and 2015 that it fell below Pennsylvania’s minimum staffing standard
Despite the issues, the Heath Department approved the transfer of Golden Living’s licenses to those companies.
Perhaps most concerning of all, advocates said, is the state’s approval of licenses to Skyline Healthcare.
Before 2018, the New Jersey-based chain managed roughly 100 homes across the nation. It bought the licenses of many of those homes from Golden Living, including seven in Pennsylvania.
In April 2018, barely a year after the Health Department granted those licenses, the company faced such severe financial problems that it abandoned nearly all its homes. Health departments in affected states, including Pennsylvania, were forced to take temporary control of those facilities in order to protect residents.
Advocates and researchers said Skyline’s sudden collapse is another indication of how poorly states are vetting nursing home companies.
“The problem is that states don’t have criteria for judging quality or financial stability,” said Charlene Harrington, professor emeritus of sociology and nursing at the University of California, San Francisco. “So they’re not properly reviewing new applications.”
Wardle, the Health Department spokesman, said the department granted licenses to Skyline and the other three operators in accordance with Pennsylvania law.
“These policies include ensuring the buyer does not have any issues at other facilities, does not have a criminal past, and is capable of providing safe care,” Wardle said.
But a PennLive review of licensing documents showed no evidence the department assessed the financial health of Skyline or the other buyers of Golden Living’s homes. It also found no evidence the agency assessed staffing levels, citation numbers, or other metrics that would help it determine whether those operators can provide safe care.
The documents were provided in response to a request under Pennsylvania’s Right-to-Know Law. PennLive is appealing the release of records the department withheld.
In response to a separate records request for its policies for vetting nursing home operators, the department told PennLive that none existed.
Concerns about the department’s loose approach to vetting has only been heightened in the aftermath of the state’s takeover of Skyline.
In May 2018, the state ceded management of the company’s homes to new operators. The department granted four of those licenses to the owners of Priority Healthcare Group and CHMS Group.
Based on documents provided by the department, PennLive again found no evidence it assessed the record of care provided by those companies. In its rush to approve those licenses, PennLive also found the Health Department didn’t ask the companies to provide key documents it typically requires.
“The department felt it was necessary to expedite these applications due to the fact that the previous operator walked away from the operations,” Wardle said. “For that reason, it was critical that the transfer of operations to a more responsible operator occur in an expedited manner.”
Asked why it believed the owners of Priority and CHMS were responsible operators, given their history, Wardle reiterated the department approved licenses in accordance with the law.
“The safety of Pennsylvanians receiving care in a long-term care facility is a priority of the Wolf Administration,” Wardle said.
For Brooks and other advocates, those words ring hollow. The decision to continue transferring licenses to problematic companies suggested that state oversight had reached a crisis point.
“They are putting the care of patients – potentially thousands of Pennsylvanians – in the hands of people they know they can’t trust,” Brooks said.
Those kind of decisions, Brooks added, were emblematic of exactly why the state Attorney General sued Golden Living in the first place. The Attorney General was forced to step up because regulators weren’t.
“Really that’s what it was,” Brooks said. “It was an end-run to do something about these poor-performing homes because the Department of Health wasn’t doing anything.”
Golden Living once dominated America’s elderly care industry.
In the 1990s, the Arkansas-based company, then known as Beverly Enterprises, ran more than 500 nursing homes across 30 states.
Today, to an outside observer, Golden Living would appear to be a shell of its former self.
Racked by years of state citations and lawsuits over care, the chain has transferred nearly all of its operating licenses to other companies, including its 36 Pennsylvania licenses.
But while Golden Living’s blue and gold signs have disappeared from those homes, the company is still profiting from the residents inside. And some said that exposes a national problem with transparency of nursing home ownership.
A PennLive review of property records found that Golden Living still owns the real estate of all 36 homes it formerly managed in Pennsylvania. In other states, according to news reports and interviews with attorneys and researchers, the company appears to have retained similar ownership of more than 200 homes.
In essence: Golden Living has become a landlord rather than a care provider.
Asked by PennLive in 2016 why it retained its Pennsylvania properties, the company declined to explain.
“That was a business decision,” spokeswoman Michelle Metzger said. “We are a privately-traded company and we are not going to reveal the reasoning behind it. It’s not relevant.”
The company declined to respond to other questions submitted over several months for this story.
But some industry observers said the company’s strategy isn’t overly mysterious.
Steve Monroe, managing editor at Senior Care Investor, a trade publication, said it appears that about two years ago, Golden Living’s owners decided they wanted to turn the company into a real estate investment trust.
Real estate investment trusts, also known as REITs, are entities with special tax benefits that invest in commercial real estate. Some specialize in owning healthcare-related properties such as hospitals, medical office buildings and nursing homes.
Monroe said that for Fillmore Capital Partners, the private equity firm that owns Golden Living, the perks of transforming Golden Living into a REIT were likely clear: it could still profit from its homes while insulating itself from lawsuits and other headaches involved in day-to-day operation.
“Private equity firms usually don’t want to run nursing homes,” Monroe said. “They want someone else to.”
As a private firm, there’s little public information about how well that transformation has worked out for Fillmore Capital Partners.
Based on an analysis of Medicaid cost reports for 20 of its homes, PennLive estimated Golden Living received at least $12 million in rent in 2017 from the operators now running its Pennsylvania properties – about $600,000 per home.
The actual total is likely much higher because financial data on the 15 other homes it owns in Pennsylvania was not publicly available at the time this story was reported.
Just because Golden Living is not providing care anymore, some observers said, doesn’t mean the company isn’t necessarily influencing it.
At least, that’s what one of the company’s former tenants said.
“They are not fair players,” said Juda Englemayer, a spokesman for Skyline Healthcare. “There’s a reason they got out of the business.”
Over the past three years, Skyline Healthcare, a New Jersey-based chain, took operational control of about 100 Golden Living homes, largely spread across the northern plain states.
In Pennsylvania, the company took over management of seven of Golden Living’s facilities. It also operated two other homes not formerly owned by Golden Living.
Englemayer said the agreements Skyline signed were not leases in the traditional sense. In addition to paying rent, Golden Living required Skyline to buy certain amounts of goods and services from its subsidiaries, he said.
The arrangement worked for both companies initially but at some point, according to Englemayer, Golden Living changed its terms and imposed far more onerous conditions on Skyline.
Once the company realized it couldn’t sustain itself financially, Englemayer said, Skyline attempted to find new operators to take over its homes.
Golden Living repeatedly refused to accept those new operators, according to Englemayer.
“They kept kicking the can down the road until there was no cash left,” Englemayer said. “And the unfortunate thing about that is we had solutions.”
The company’s financial problems became so severe in April 2018 that workers weren’t paid and its homes were at risk of running out of food and medication.
State agencies in multiple states, including Pennsylvania, were forced to take emergency control of the facilities. In May, new nursing home chains took control of eight of the company’s nine homes in Pennsylvania.
Some, however, are skeptical that Skyline’s explanation is the whole story behind its collapse.
Matt Yarnell, president of the SEIU Healthcare of Pennsylvania, said management problems were obvious almost immediately after Skyline Healthcare took control of its homes in Pennsylvania.
“There was really no system in place to support the managers of the facility,” Yarnell said. “It was really left on the shoulders of the administrators.”
Even if the company’s problems were largely due to Golden Living’s leases, Yarnell said, it would appear to be Skyline’s own fault for signing them.
But Yarnell agreed that regardless of what conditions Golden Living imposed on Skyline, nursing home leasing deals make it difficult for the public to understand what companies own which homes and what influence they may be exerting behind-the-scenes.
“I think Pennsylvanians want to know where their tax dollars are going,” Yarnell said. “We need to know where the financial arrangements behind these homes.”
As part of its reporting, PennLive interviewed families whose loved ones were cared for in Pennsylvania homes formerly managed by Golden Living.
None was aware that Golden Living continued to own the properties. Some said they would have avoided those homes if they knew the company was still connected with them.
“I had no idea they still owned the property and this group rents it,” said Heather McCleaf-Royle, a New Cumberland woman whose mother stayed in an East Pennsboro home owned by Golden Living this year. “I thought it had been sold.”
Transparency remains a major issue in the industry, said David Stevenson, an associate professor of health policy at Vanderbilt University.
While the federal government requires nursing homes to disclose ownership information – which it posts publicly on its website Nursing Home Compare – it has no similar disclosure requirements about nursing home landlords or their lease agreements.
While a regulator’s first priority should be overseeing the care inside a home, Stevenson said, transparency over those agreements is also important because they may indicate whether an operator can provide good care.
“If there’s a separate real estate owner I don’t think a typical person would care if it’s Golden Living or someone else,” Stevenson said. “But they would want to know if the operator is in a financially precarious situation.”
In Pennsylvania, the Health Department typically asks nursing homes to provide copies of leasing or operational agreements if they lease facilities. The department denied PennLive’s request for copies of Golden Living’s leases, arguing that they contain trade secrets or proprietary information.
PennLive has appealed that decision to the state Office of Open Records.
Some believe that the public might be alarmed if they knew what those leases contained.
David Marks, a Texas-based attorney who specializes in elderly care litigation, pointed to a case he’s litigating that involves a major assisted living chain.
That chain, like Golden Living, leases homes to operators. While that isn’t unusual, Marks said, what is unusual is how much control the chain has over each of those operators.
“The lease agreements are pretty shocking,” Marks said. “The leaser effectively controls operations, approves the budget, receives financial forecasts and – if the financial forecast is not agreeable – has the right to modify the budget.”
In essence, Marks said, the chain is effectively running the homes in all but name.
And in exchange, Marks added, both are insulated from lawsuits by families who allege bad care.
“The company has nothing to do with the operations,” Marks said. “He can say, ‘You can’t sue me, you have to sue the operator’ – but the operator is undercapitalized.”
While Marks has not reviewed Golden Living’s leases to know if they if they are using similar provisions, he said the public would be wise to demand greater transparency about all operational agreements being signed by nursing home chains.
Without that information, Marks said, it’s difficult to know who is really running a nursing home and what they’re willing to do to maximize their profits.
“The only way to increase your margins is to either increase your revenues or decrease your expenses,” Marks said. “And if you attempt to do both, it’s a formula for disaster. That’s what’s scary.”
In 2016, PennLive published ‘Frailing the Frail’, a six-part investigative series that explored major problems in Pennsylvania’s nursing home industry, including the death of 46 residents.
That investigation was prompted in part by a 2015 lawsuit filed by Pennsylvania’s Attorney General against Golden Living and other nursing home chains in Pennsylvania. Three years after that lawsuit and two years after the publication of ‘Failing the Frail’, PennLive wanted to use Golden Living’s nursing homes as a lens to re-examine the state of Pennsylvania’s nursing home industry.
PennLive reporter Daniel Simmons-Ritchie discovered that Golden Living sold the licenses of all 36 of its homes to new operators. And, over eight months, based on interviews with more than a dozen families and residents, and an extensive analysis of state and federal records, PennLive found most of those homes had the same or more citations and lower staffing under new operators than under Golden Living. Two of the operators defended they are dedicated to providing quality care.
The timeliness of PennLive’s reporting was only heightened in April when one of the companies operating Golden Living’s former homes, Skyline Healthcare, went into receivership in Pennsylvania and other states, forcing state agencies to take emergency control of those homes to protect residents. That situation raised new questions about how closely Pennsylvania scrutinizes the financial stability of new nursing home operators.
Beyond that, as Simmons-Ritchie’s reporting progressed, he discovered that Golden Living may still be influencing care inside those homes: The company continues to own the real estate to all 36 of its home and it remains unknown how much control Golden Living may exert over the companies now managing those facilities.
PennLive ultimately concluded that three years after the Attorney General’s lawsuit, Pennsylvania appears to still be failing its frailest citizens.
REPORTING: Daniel Simmons-Ritchie is an investigative reporter with PennLive and the Patriot-News. He has earned state and national awards for work on a variety of subjects, including health care, criminal justice, and the environment.
ADDITIONAL REPORTING: David Wenner
PROJECT EDITORS: Ron Southwick and Burke Noel
DESIGN & PRODUCTION: Megan Lavey-Heaton
DATA & INTERACTIVES: Nick Malawskey and Daniel Simmons-Ritchie
PHOTOGRAPHY & VIDEOGRAPHY: Dan Gleiter, Mark Pynes, Sean Simmers, and Daniel Simmons-Ritchie