Lawmakers press nursing home chains on corporate spending amid staffing rule fight

May 6, 2024

Congressional Democrats demanded information about the corporate spending by the operators of three of the country’s largest public, for-profit nursing homes, after the companies said they can’t afford the Biden administration’s new minimum staffing threshold

In letters sent to the companies Sunday, Sens. Elizabeth Warren (D-Mass.), Richard Blumenthal (D-Conn.) and Bernie Sanders (I-Vt.), along with Reps. Lloyd Doggett (D-Texas) and Jan Schakowsky (D-Ill.) pressed for information about buyouts, dividends, and salaries to executives and shareholders. 

The lawmakers aim to contrast that with the salaries for nurses and nursing aides, amid widespread industry opposition to the new staffing requirements because they are too costly.  

“These two competing claims do not add up,” the lawmakers wrote, noting that the industry “diverts hundreds of millions of dollars in cash away from nursing home staff and patient care, and into the pockets of company executives and shareholders.” 

The lawmakers demand the three companies answer how they determine executive compensation and whether it is influenced by quality of care or profits. The letters also ask for answers on the three companies’ average pay and tenure for their registered nurses and nurse aides.

Since 2018, National Healthcare Corp., the Ensign Group Inc. and Brookdale Senior Living Inc. have paid out nearly $650 million in stock buybacks, dividend payments, and other financial rewards to top executives, including nearly $118 for Brookdale Senior Living, $300 million for the Ensign Group and over $226 million for National HealthCare Corp. 

The lawmakers said that level of executive spending undermines “the claim that nursing homes cannot afford to pay for enough staff” to meet the new rule. 

Last month, the Biden administration announced a final rule requiring nursing homes to have minimum levels of front-line caregivers for the first time or face financial penalties. 

Among other provisions, the final rule will also require facilities to have a registered nurse on staff 24 hours per day, seven days per week. The rule requires nursing homes to provide each resident a minimum of 0.55 hours of care from a registered nurse and 2.45 hours from a certified nursing assistant every day. 

The rule is aimed at addressing nursing homes that are chronically understaffed, which can lead to substandard or unsafe care. The rule’s requirements will be introduced in phases, with longer timeframes for rural communities. 

Advocates have been calling for a minimum staffing requirement for more than two decades, arguing that residents are safer and have better care with more staff, but the industry had successfully resisted.