Private Equity-Backed Nursing Homes Log Similar COVID Outcomes as Other Facilities, But Less PPE

Nursing homes owned by private equity (PE) firms had COVID-19 outcomes comparable to facilities with other ownership structures, including similar staffing levels, case counts, and COVID-19 deaths — as well as deaths from any cause, according to a study published October 28 in JAMA Network Open.

The study examined 11,470 nursing homes in the U.S. to determine whether nursing homes with PE ownership performed better or worse during the pandemic, compared with other facilities.

“PE-owned nursing homes did not have significantly higher self-reported rates of COVID-19 cases than non-profit or for-profit nursing homes but had 35.5 more cases per 1000 residents than government-owned facilities,” the authors wrote. “PE-owned homes did not have significantly higher rates of COVID-19 deaths or of deaths from any cause. It is possible that differences in rates of testing among facilities may have obscured differences in COVID-19 cases and deaths, but this would not have affected estimates of deaths by any cause.”


The study drew from the Nursing Home COVID-19 Public File from May 17, 2020 to July 2, 2020, and compared PE-owned nursing homes with facilities that had for-profit, non-profit and government ownership, with adjustments for facility characteristics.

The authors were all affiliated with the Department of Population Health Sciences at Weill Cornell Medical College.

The team measured the self-reported number of COVID-19 cases and deaths, as well as deaths by any cause, per 1,000 residents; whether or not facilities had one-week supplies of personal protective equipment (PPE); and whether or not there were staffing shortages.


The 11,470 facilities were broken down as follows:

  • 7,793, or 67.9%, were for-profit
  • 2,523, or 22%, were non-profit
  • 511, or 5.3%, were government-owned
  • 543, or 4.7% were PE-owned

The researchers identified nursing home acquisitions by PE firms between 2010 and 2020 through various sources: the S&P Capital IQ, Irving Levin Associates’ Health Care M&A information, and the Centers for Medicare & Medicaid Services (CMS) Nursing Home Compare Ownership databases.

While staffing shortages did not differ significantly between nursing homes owned by PE and those owned by for-profit or nonprofit entities, PE-owned facilities were less likely than for-profit, non-profit or government owned homes to have a 1-week supply of various kinds of PPE.

According to adjusted measures for PPE, for-profit, nonprofit, and government-owned nursing homes were 10.5%, 15% and 17%, respectively, more likely to have at least a week’s supply of N95 masks, compared with PE-owned facilities.

PE-owned nursing homes were also more likely to fall short, compared with for-profit, non-profit, and government-owned nursing homes, on having a week’s supply of medical gowns; less likely to have eye protection, compared with non-profits; and less likely to have a supply of gloves, compared with government-owned facilities.

“There were no significant differences in staffing shortages between PE facilities and other types of facilities, except that government-owned facilities were 6.9% more likely to have a shortage of nursing staff,” the authors noted.

PPE issues for nursing homes as a whole have improved since the start of the pandemic, but facilities across the country have reported shortages of some kind, with some states faring much worse than others.

The reasons for PPE shortages at PE-owned properties are not clear; though they could have been caused by cost-cutting strategies at the PE-owned facilities, but that raises the question of why staffing levels were not lower, the authors said.

They also noted that six other studies examining outcomes of for-profit nursing homes with other kinds of homes have been inconsistent, though “no previous research that we are aware of has examined PE ownership and outcomes associated with COVID-19.”

The pandemic has thrown a harsh spotlight on conditions in nursing homes, and several studies have already begun to examine various factors that lead to worse COVID-19 outbreaks in facilities.

Some specifically dove into the issue of ownership: One report from a financial reform advocacy group found that facilities in New Jersey with private equity ownership had higher rates of COVID-19 infections and deaths, and a study from researchers at the University of Pennsylvania’s Wharton School, NYU-Stern, and the University of Chicago found declines in a variety of nursing home metrics after private equity takes over.

Even before COVID-19, private equity in SNFs was coming under scrutiny; several lawmakers demanded answers from firms on their ownership of nursing homes in the last months of 2019.

That interest was noted by the authors of the JAMA study.

“The distinction between PE and non-PE for-profit facilities is important because policy makers have expressed concerns that PE-owned nursing homes may have different incentives and provide lower quality care compared with for-profit as well as non-profit homes,” they wrote.

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