After Rapid Growth, Nursing Home Chain Collapses

The national nursing home chain Skyline Health finally collapsed last year after years of aggressive growth fueled by debt and shady business practices. The aftermath of the chain’s collapse is far-reaching – the chain once ran nursing homes in almost every state in the country, according to NBC News. Further, the disastrous financial situation that plagued the company has now fueled lawsuits against the company by employees seeking unpaid wages and residents who say they were neglected because the company could not afford basic medicine or utilities at their nursing home. This does not even touch upon the upheaval that the chain’s closure caused to countless senior citizens across the country.

As more horror stories come out about Skyline Health’s treatment of its residents, families of displaced residents are searching for answers about how the doomed nursing home chain continued its nationwide expansion while its problems piled up. Skyline started with less than 20 nursing homes in 2015 and expanded to more than 200 in just a couple years, all while state regulators levied substantial fines against the negligent and cash-starved corporate chain.  During the debt-fueled acquisition period, Skyline Health’s owners pillaged the company with lavish payouts and told nursing homes to enact draconian cuts. According to NBC News, the staff at a Skyline Health nursing home in Massachusetts started bringing their own toilet paper for the residents. A corporate memorandum instructed another Skyline Health nursing home to only provide two disposable briefs to each resident per day, cruelly leaving residents to sit in their filth.

The problem, according to an analysis by NBC News, involves a lack of effective regulation on nursing home ownership. Most importantly, regulators have not responded to the consolidation of the nursing home industry. Where nursing homes were once owned by a single person or group, nursing homes are now more likely to be a part of a nationwide corporate chain. These for-profit nursing homes generally offer a lower-level quality of care compared to their non-profit competitors.

Further, nursing home chains typically derive the majority of their income through Medicare and Medicaid. Skyline received almost 70 percent of its income from the federal government. Despite the massive amount of federal dollars, the Centers for Medicare and Medicaid Services lacks a centralized database of nursing home ownership which could flag problematic owners and warn other states. While states are beginning to require nursing home chains to list the financial and ownership structure of their other nursing homes, elder care advocates say it’s a limited solution.

Contact us to discuss your potential case involving neglect or abuse at a nursing home.

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