Schakowsky, Takano Introduce Legislation to Bring Transparency to Nursing Home Ownership

WASHINGTON – Last week, Congresswoman Jan Schakowsky (D-IL), a Senior Chief Deputy Whip, Chair of the Consumer Protection and Commerce Subcommittee of the Energy and Commerce Committee, and Co-Chair of the House Democratic Task Force on Aging and Families, and Congressman Mark Takano (D-CA), Chair of the House Veterans Affairs Committee, introduced the Linking Investors and Nursing Home Quality (LINHQ) Act. This legislation brings long-overdue transparency into nursing home ownership and financial activity. As private equity firms continue to move into the nursing home space, this legislation will shed light on whether Medicare and Medicaid funds are truly being directed to care for our nation's seniors and individuals with disabilities. The bill requires nursing homes and parties with ownership interests to disclose ownership and financial information each year, down to the 5% ownership level, with penalties for non-reporting. From 2010 to 2019, there has been a large increase in private equity companies buying up nursing homes and other health care services. However, a growing body of research shows that health outcomes for residents in private equity-owned facilities are worse. One February 2021 study from the National Bureau of Economic Research found that going to a private equity-owned nursing home increased mortality for resident by 10% against the overall average.

"Every person in the United States deserves to age with dignity and respect, said Congresswoman Jan Schakowsky. "Medicaid, Medicare, and federal government resources pay for the majority of long-term care in the United States. Movement of private equity firms into the long-term care space has been extremely concerning. We have seen what these companies do: put profits over people. In the end, quality of care decreases and our loved ones suffer. The Linking Investors and Nursing Home Quality Act will ensure that there is transparency in who owns long-term care facilities, shed light on where taxpayer dollars are going, and ensure that nursing home residents and workers are protected.

"Families entrust nursing homes with the responsibility of caring for their loved ones – they need transparency and peace of mind when it comes to the ownership and management of these facilities," said Congressman Mark Takano. "The Linking Investors and Nursing Home Quality Act requires timely disclosure of ownership each year and establishes a grant program for states to properly address poor-quality nursing homes. I'm proud to co-lead this effort to ensure our elders are receiving the best care possible."

"We thank Representative Schakowsky and Representative Takano for their leadership in efforts to make nursing homes better places to live and work," said Richard Mollot, Executive Director of the Long-Term Care Community Coalition. "This bill will help address two of the most significant challenges to good care and dignity for residents and their families: improving the financial accountability of operators (too many of whom funnel money away from care into profits) and expanding access to dignified, resident-centered nursing home care for low-income residents."

The Linking Investors and Nursing Home Quality (LINHQ) Act would:

• Require nursing homes and parties with ownership interests to disclose ownership and financial information each year, down to the 5% ownership level. Non-compliance will result in a bar on new admissions and suspension of payments until compliance for reporting and quality metrics are met.
• Create a Data Liaison Team within the Centers for Medicare and Medicaid to identify patterns in nursing home ownership linked to nursing homes that do not comply with reporting; do not meet payroll-based journal levels of 4.1 direct care hours per resident, per day; or fail to meet quality standards set by the Secretary of Health and Human Services.
• Establish an Interagency Board to review poor quality nursing homes and nursing homes that are noncompliant with ownership reporting. The Interagency Board will determine which nursing homes should be referred to the Health and Human Services Office of the Inspector General and the Department of Justice for further investigation. The Interagency Board must also submit a biannual report to Congress on findings and the result from any referrals, including any reasons for not pursuing action.
• Amend demonstration language in the Affordable Care Act to fund national demonstration projects on culture change and the use of information technology in nursing homes.

Click here for a section by section of the bill.

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