Tag Archives: nursing homes

The Nursing Home Business Model is Deadly

Pearl River     Nursing homes have been a huge source of deaths in the United States during the coronavirus pandemic.  Local 100 represents a number of private and public homes, as well as other healthcare facilities, so has been with our workers at the razor edge.  On a monthly basis, we continue to deliver PPE to facilities generally and where our members worth throughout Louisiana, Mississippi, Arkansas, and Texas, thanks to NOLAPPE Last Mile Every discussion we have with employers is contentious about everything from hazardous pay to PPE to frankness in sharing information on patient and consumer tests to OSHA health and safety standards.  We win some, and we lose some from company to company.  That’s been the way it has been 35 years, but this time the stakes are higher than the pay envelope, and the story is sometimes front-page news.

For all of those years, I’ve been telling our leaders, members, and organizers, that they needed to understand that in the eyes of our for-profit, corporate home ownership we were as much a real estate enterprise, not as a health care endeavor.  For most of them, as long as reimbursement rates from the government were good enough to break a bit better than even and they were able to lard their salaries and expenses onto the cost reports, they were hoping the appreciation of the real property in buildings and land underneath the hospital beds would be enough for them to make their killing.  Often, they would roll their eyes, because it seemed too cynical and hyperbolic for many.

With the pandemic death count, the corporate business model is being exposed.  Andrew Cockburn wrote a devastating piece in Harper’s called “Elder Abuse:  Nursing Homes, the Coronavirus”, and the bottom line, confirming in most ways our decades of experiences.  He noted that by late June there were 55,000 deaths in such homes, not counting that “one in five homes didn’t bother to report the numbers at all,” and none of them were required to report before May 8th.  That’s the effect.  The cause, as Cockburn documented, is often found in some of the 21st century adaptations of their basic business model thanks to REITs and private equity, which have stripped the assets, made sure that wages for the same work in hospitals were significantly lower in homes, stretched staffing past care standards, and stripped costs past the bone on everything from supplies to food for clients.  All true.  In one of our Shreveport homes they only had two face shields for the entire home until we delivered more, so they washed them as best they could to share from worker to worker, shift to shift.  We had an ownership change in recent years when a REIT holding other homes in the same area essentially foreclosed on the management company unable to make their predatory leasing terms.

Cockburn is critical but can hardly hide his amazement at the prowess of their lobbying skills in the states and with the Trump administration that they have been able to spin their way to getting billions rationalizing the pandemic for their slash and burn nursing home business model.  More than 20 states have already absolved them of liability for the deaths and inadequacies of care, and the Senate is trying to do the same for them and others.  The Wall Street Journal reported recently that the handpicked commission they had wheedled from the Trump team was preparing to report on more of the companies’ woes, while letting them tap into another $5 billion until they can get more in the next stimulus package.

The Journal also updated the reported death count in homes at over 70,000 accounting for 40% of US deaths from the virus now.  It turns out we do have death panels, as the Republicans argued in opposing the Affordable Care Act, but instead they are called commissions, and rather than demand reform in the homes and advocate regulations to put an end to the killing fields inherent in this business model, they just ask for more supplies and money without looking at the causes behind this catastrophe in name of healthcare.


Save Lives? Give Healthcare Workers Raises

New Orleans       Hey, bosses of healthcare workers, listen up!  Yo, consumers and families of healthcare services, pay attention to this, like your life is at stake, since for more than half of you over 65, it is, because you will end up in long-term care.  Policy peeps and political hacks, heads up:  pay attention in class.  What’s up?  There’s some news we can use thanks to some deep data analysis and research done by economist Krista Ruffini for the Minnesota Federal Reserve Bank.  (Higher Wages, Service Quality, and Firm Profitability: Evidence from Nursing Homes and Minimum Wage Reforms)

Here’s the bottom line:  Ruffini found that a 10% increase in the minimum wages for direct care staff in nursing homes led to less turnover, fewer inspection deficiencies, and 15,000 lives saved.  Yes, those of us who represent direct health care workers in nursing homes and community care facilities have always told you so, but now, finally, someone has marshaled the facts behind our arguments.  Ruffini in her paper notes that most previous research has been in production and retail work, so now we’re getting our due.

Furthermore, there was no evidence in her research that smaller healthcare operators went out of business nor that jobs were lost, nor were there regional differences.  The only downside is that operators increased their prices somewhat to cover the wage increases and tried to enroll more private patients, but frankly they have been doing that anyway without sharing much with the workers, so it’s more like a scratch, and less like a wound.

Some of this isn’t news exactly.  Ruffini notes that her work aligns other studies that have found that increasing pay for public employees like hospital workers improves “service quality” and for teachers “improves test scores.”

In another comment close to our beating union hearts, she notes that “…unionization decreases staffing levels but does not worsen patient outcomes, suggesting labor market policies can alter worker productivity in this sector.”  That’s interesting as well, especially when compared to the sound and fury of employers every time we launch an organizing drive in health care facilities.  She also found that such wage increase didn’t alter the “demographics” of the workforce nor the did it change the level of “credentialed” staffing, which is another way of telling employers that they would still be hiring from the same local racialized and gender-dominated labor pool, which might make them panic less.

Does any of this really matter, and will it mean more in the pockets of lower-waged direct care workers?  I’m betting yes.  The pandemic has raised public understanding of the necessity and existence of essential workers, while also underlining the fact that nursing home and other direct healthcare workers face hotspots.  Employers have had to respond in many cases with more protection for workers, pay increases, and hazardous duty pay.  Studies like Ruffini’s may make it harder to reduce wages, allowing direct care workers to hold onto these gains and convert them permanently, improving their lives and saving lives at the same time.  A rare, but welcome, win-win.


Please enjoy Magnolia Road by The Allman Betts Band.

Thanks to WAMF.