Everyone is Right About What’s Wrong with American Nursing Homes

One of the most frustrating parts about covering the disaster in long-term care over the past year has been seeing the incredibly complex system failure of COVID distilled into news stories, Twitter broadsides, and press releases with decidedly simpler narratives.

Whether you’re a novelist or a journalist, good storytelling requires a hero and a villain, and nobody has time during a global pandemic to tuck into the voluminous tale of a once-in-a-lifetime storm crashing into a nursing home landscape with endemic problems stretching back generations.

So instead we get something like the Andrew Cuomo drama, where suddenly in the public mind he alone is personally responsible for more than 15,000 deaths after people were sent to New York nursing facilities without COVID tests under a controversial state health department order.


In one of the narratives that has emerged over the last few weeks, Cuomo specifically made this move to please his overlords in the nursing home lobby, who — for some reason that is never fully explained — desperately wanted to accept COVID-19 patients, despite the fact that the state’s top nursing home lobbying firm publicly expressed concern and confusion about the order in March.

Then, after the facilities got exactly what they wanted in the form of thousands of patients they were publicly stating they could not handle, they got another gift in the form of blanket immunity against lawsuits stemming from the disaster that Cuomo caused on their behalf.

If you stare too long at this logic, the pieces don’t all quite fit together as neatly as the insinuations make it seem. But why let that get in the way of a good story with clear villains (Cuomo and the nursing home owners) getting their comeuppance from a ragtag group of heroes (the politicians and resident advocates calling for Cuomo’s resignation and a flood of lawsuits against nursing homes)?


The real story is a lot more boring, but just as damning of our attitudes around senior care. Cuomo — a hard-nosed leader known for his harsh tactics and unwillingness to delegate tasks — made a catastrophically bad decision at the start of a crisis, then responded by withholding information while implementing liability shields that the state’s hospital systems wanted just as badly as the nursing home lobby. 

People forget, but this time last year, Cuomo and leaders in several other states with similar nursing home admission orders were laser-focused on maintaining as much hospital capacity as possible. Even the federal government — led by Cuomo’s arch-rival, then-President Trump — had the same idea, with CMS administrator Seema Verma publicly talking about using nursing facilities as overflow for hospitals, and specifically waiving rules to make that happen.

They achieved that goal, with hospitals able to withstand the crush of patients, but they did it at the expense of the unacceptable number of nursing home residents and staff members who became sick and died. A system neglected by regulators and lawmakers for decades collapsed under the weight of a pandemic that no one saw coming — as well as decisions made in the heat of a unique historical moment.

If you’ve made it this far, then stick around for the first edition in an occasional series about how pretty much all of the arguments that have become commonplace in the media narrative around nursing homes contain truth, including the ones presented as opposing concepts — and how pretending that there’s only a binary, in which one heroic voice strikes at the heart of one villain’s treachery, will only lead to more death and a return to an already insufficient status quo.

This week, we start with nursing home reimbursements.

If you ask industry leaders, Medicaid payments simply aren’t enough to provide high-quality care for residents, about 62% of which rely on the program to pay for their nursing home stays. Nationwide, the per-day reimbursement figure sits at about $230, less than you’d probably pay for a night in a mid-range business hotel in a major city or even a nice suburb — a fact that no one can really deny.

These Medicaid rates — and the general concept of Medicaid being the primary payer for long-term care — harken back to a time when nursing homes were catch-all facilities for anyone who couldn’t live at home anymore. With the rise of assisted living, independent living, memory care, and home health, the relatively healthier (and wealthier) people gradually siphoned off until only the very sickest remained, creating a system where states still pay custodial-care rates for truly complex medical cases.

Resident advocates and industry critics are quick to respond: Ah, we actually don’t know if that’s too much or not enough, since nursing home owners and operators cloak themselves in so many layers of no-name LLCs and related-party vendors that it’s hard to figure out who’s making what and who’s paying who. This is also correct, and I have the wasted hours of trying in vain to figure out who owns a certain nursing home to show for it. Stewards of both taxpayer money and our most vulnerable should be as transparent as possible in their spending.

The Medicare Payment Advisory Commission (MedPAC) — no friend of the we-need-more-money camp — claims that nursing homes make a healthy margin on Medicare payments, but pretty much break even or lose a little bit of money when factoring in Medicaid rates. This is also correct to the extent of the data available.

So when the various parties express their opposing viewpoints, what’s the upshot of all this in a for-profit health care system? Nothing changes.

(As a quick aside, it’s deeply amusing to see both news outlets and industry critics wield the phrase “for-profit” like it’s some kind of gotcha in the nursing home debate. The entire health system, from the primary care doctor I see to the health insurance I get through my job, is a for-profit enterprise. For-profit Medicare Advantage plans cover an increasing share of nursing home care in the United States, and analysts project that soon more than half of seniors will eventually get their Medicare coverage through a supplemental plan. Nursing home operators, both for- and non-profit, must pay a galaxy of for-profit vendors to keep their buildings running, from linen to food to medical supplies. You’re free to criticize the for-profit system, as I do often, but you can’t act as though it’s a problem unique to post-acute and long-term care.)

Investors who might want to build the kinds of new facilities that actually take resident dignity and quality of life into account from the ground up look at the Medicaid rates and say, eh, I’ll pass; there’s no way I can pencil out a new development with that kind of income. I’ll never make the profit I want, and neither will the construction firm, the land broker, and any of the numerous other players that go into the development of new health care real estate.

If there is any new development for senior care, it’s high-end assisted living campuses and post-acute “medical resorts” aimed solely at private pay and Medicare beneficiaries, not the long-term residences for people covered by Medicaid. Meanwhile, the long-term care infrastructure gets older and older, and often ends up remaining in the hands of people who know how to game the system well enough to secure a return on their investments and provide the barest minimum standards of care to keep the regulators at bay.

Is that a good thing for society? No. Should we be satisfied with a system where these considerations determine whether or not your mother gets a nice place to live when she can’t be on her own anymore? Also no.

But when the argument boils down to “we need more money” versus “no you don’t,” the worst actors already win, because the status quo rules. It doesn’t matter if, from a purely academic standpoint, current Medicaid rates are “enough” or not — they’re enough to give us this current system, the one that failed us, and something must change.

So to the industry: After the waves of death and sickness over the past year, you cannot expect to stick out your hands and receive more money for nothing. I supported the emergency distribution of funds through the CARES Act, and I think some criticisms of the program are in bad faith, but the immediate crisis wave is over. Now is the time for introspection and reform, and any requests for more funding have to be backed up with honest support for increased transparency around ownership and profits, as well as mandatory reinvestment of income into the buildings themselves.

But to the critics: Arguing that the sector shouldn’t get any more funding is a cynical viewpoint that will ultimately only punish future residents, and not the industry leaders you disdain. The age of the average nursing home is slowly but surely approaching the age of the baby boomers they’ll soon need to serve, with triple and quad rooms the norm in far too many places across the country. Living into your 90s and 100s will only become more common as the boomers age, and at least a portion of them will need around-the-clock care in an institutional setting; in fact, many people want a community instead of the social isolation of home care.

It’s going to take untold sums to overhaul a nursing home infrastructure that’s outdated, long-neglected, and ill-suited to the generations of elderly people coming down the pike. We can’t let operators put profits over patients, but we also can’t let the takeaway be even more austerity for our most vulnerable.

Simply put, you can throw Andrew Cuomo in jail tomorrow, but that won’t fix long-term care. (In fact, if I’m a truly ghoulish nursing home owner who cares only about profits, I want the Cuomo scandal to last as long as possible before he eventually goes down as a scapegoat for me, since the political capital to do anything else will have been long since exhausted.)

You can unleash a wave of lawsuits on nursing home operators, but they have good lawyers, too — and once the dust settles, it’ll likely encourage the ones who remain to retreat deeper and deeper behind no-name shell companies unless there’s a more comprehensive plan for reform after the personal injury lawyers do their work. Justice for those who died is critically important; justice for generations yet to come is also vital.

It’s going to take a massive lift, probably on the scale of a new WPA, to build the senior health care landscape this country deserves. But will we be able to set aside the easy narratives and do the complicated work of admitting fault, committing to real reform, and studying the countless decisions that got us to this point? Only time will tell.