The New York Times examined more than 1200 nursing homes purchased by private investment groups in the past several years, and discovered that, compared to national averages, these homes declined in care given, and scored lower in 12 of 14 indicators used to track ailments of long-term residents.  Homes owned by such investment firms as Warburg Pincus and the Carlyle Group (owners of Dunkin’ Donuts), had greater than average incidences in residents of bedsores, easily preventable infections, and unecessary restraints in freedom and mobility.

Investment firms move in and take over unprofitable nursing homes, fire nursing staff and cut back on other resources, begin making money, and then may sell the homes at a big profit.  While this particular strategy benefits investors, it leaves many aged nursing home residents more vulnerable to a range of age-related risks including depression, loss of mobility, and loss of the ability to dress and feed themselves.  A big problem with investor-owned nursing homes is that they often legallly structure their ownership in such a way that it becomes difficult to sue them when residents become ill or die due to neglect.

Because they are privately owned, they are also immune to many of the local, state, and national regulations that apply to publicly owned nursing homes.  They are, therefore, able to function below the radar screens, and above the law.  According to the New York Times, nursing homes received $75 billion in 2006 from Medicare and Medicaid, making them a veritable cash cow for those investment groups that prey on them, cutting expenses, making huge profits, and leaving residents with sub-par living conditions.  To read the entire New York Times article, click here.

For more information about the developmental processes underlying the aging process, see my book:  The Human Odyssey: Navigating the Twelve Stages of Life

This article was brought to you by Thomas Armstrong, Ph.D. and

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I’m the author of 20 books including my latest, a novel called Childless, which you can order from Amazon.

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