As the industry fights the unfunded federal minimum staffing mandate in court, nursing home executive compensation is under scrutiny from Democratic lawmakers, who are criticizing some leaders in the sector for giving themselves pay raises. However, leaders in the sector are pushing back.

Specifically, the executive pay of three major operators – The Ensign Group (Nasdaq: ENSG), National HealthCare (NYSE: NHC) and Brookdale Senior Living (NYSE: BKD) – increased collectively by 25%, according to a letter sent to the companies and detailed in a report from The Hill.

The lawmakers also cited record-high profits for the first two quarters of 2024.

“You have plenty of money available to provide high-quality care – but instead are using it to enrich yourselves and other executives,” the lawmakers wrote.

In an email to Skilled Nursing News, Ensign CEO Barry Port pushed back against the logic of the lawmakers’ criticism.

“The entire thesis of their ‘inquiry’ cited in the first paragraph of the letter insinuates that our opposition to the staffing mandate is based on the fact that we ‘cannot afford to meet the new minimum staffing requirements.’  We have never alleged this in any public statement or filing,” Port said. “As such, we believe the foundation for their argument is entirely baseless. Citing executive compensation for their argument is not only sensationalistic but disingenuous.”

Brookdale said much the same in a statement from May: “In your letter’s conclusion, it is stated that ‘Brookdale Senior Living and other for-profit nursing home companies… claim they cannot afford to meet CMS’ new minimum staffing standards.’ To be clear, we never made such a claim relating to Brookdale in our comment letter, and this fact fundamentally undermines the key theme and premise of your letter and your related requests from Brookdale.”

Ensign’s strong opposition to the mandate stems from the fact that it’s not “quality based,” he said, referring to a study done by the Abt Associates where there was no obvious plateau at which safety and quality are maximized, or cliff below which quality and safety steeply decline.

Port added that the mandate doesn’t recognize the current staffing environment or costs associated with the ratios suggested. Further, the mandate comes on the heels of new data underscoring the growing crisis around access to nursing home care, via The Wall Street Journal and AHCA/National Center for Assisted Living’s Access to Care Report.

Port has also said that while the company is committed to increasing access to quality care for seniors, the mandate would only exacerbate an already precarious staffing problem.

“If it survives as is, [the rule] would severely limit the ability of the skilled nursing industry to serve the growing long-term care population,” Port said during an earnings call earlier this year.

Lawmakers Sens. Elizabeth Warren (D-Mass.), Bernie Sanders (I-Vt.), Richard Blumenthal (D-Conn.), and Rep. Jan Schakowsky (D-Ill.) sent the letter to long-term care executives on compensation.

“New public U.S. Securities and Exchange Commission (SEC) filings revealing that you and other nursing home executives were paid nearly $70 million in 2023, while at the same time claiming that you cannot afford to meet new minimum staffing requirements put in place by a Biden-Harris administration policy to improve quality of care for nursing home residents,” lawmakers said.

Top executives at the companies were paid more than $250 million, increasing from $36.9 million in 2019 to about $66.8 million in 2023, the Democratic lawmakers said. Ensign in 2023 more than doubled pay for five executives and five directors to $50.2 million, compared to $24.4 million for five executives and six directors in 2019.

NHC increased compensation for five directors and seven executives from $5.6 million in 20219 to $5.7 million in 2023.

Ensign made up the vast majority of the increase, according to the letter.

Lawmakers maintained that nurses in nursing homes, meanwhile, aren’t being paid enough and on average, nursing homes turn over half of their staff within a year, according to a public comment on the mandate from the Economic Policy Institute.

As of March, about 99% of nursing homes had open jobs, and 89% were hiring for registered nurse (RN) positions, the American Health Care Association survey of 441 facilities found in a survey.