Bloomberg reported that the bankruptcy judge in the Fundamental Long Term Care Holdings, Inc. bankruptcy stated that Fundamental Long Term Care Holdings LLC’s owners engaged in a “carefully orchestrated sham transaction” by selling a Trans Healthcare Inc. unit in 2006 to Barry Sacks.  Murray Forman and Leonard Grunstein (who pled guilty to perjury recently) were the owners of a multistate chain of nursing homes who committed fraud by transferring liabilities to a shell company that later lost more than $2 billion in jury verdicts to families who claimed relatives died of neglect due to short-staffing caused by corporate decisions on budget and expenditures.  The transfer “bears all the hallmarks of fraud,” Judge Williamson said at the hearing. The other unit, Trans Health Management Inc., or THMI, was “stripped of all its assets,” he said. FLTCH and its affiliates have “successor liability” for judgments against THMI, he said in the tentative ruling.

Fundamental, or FLTCH, a Sparks, Maryland-based company, kept the unencumbered assets of Trans Healthcare, while the other unit was saddled with the liabilities, including judgments in Florida that have never been paid over the deaths of four residents, according to a complaint by the residents’ families and the bankruptcy trustee for the company left holding the debts.

Williamson today ordered FLTCH’s owners to mediation with the plaintiffs. Lawyers for both sides said the mediation would probably happen next month.  Williamson said he wouldn’t issue final findings until after mediation. The individual lawsuits remain stalled until Williamson reaches a final decision or they’re resolved in mediation, he said.

“This means that the FLTCH group is going to be held responsible ultimately for all the liabilities of THMI,” Steve Berman, a plaintiffs’ lawyer, said after the hearing.  The plaintiffs claimed that attempting to separate liabilities from assets is a common practice in the U.S. nursing home industry, in an attempt to insulate owners from possible judgments.

In the 2006 sale, FLTCH acquired all the stock of two Trans Healthcare entities, THI of Baltimore and THI of Nevada, keeping assets such as real estate and more than 100 nursing homes nationwide.  In a separate, linked transaction, THI sold all of its stock in THMI to Fundamental Long Term Care Inc., whose sole owner was retired graphic artist Barry Saacks, who at the time of the sale was living in a basement, Williamson said, quoting from an e-mail introduced in the trial.  Saacks said in sworn testimony for the lawsuit that he didn’t know he owned the company and didn’t put up any money for it.   See additional article at Chicago Tribune.

The case is In re Fundamental Long Term Care Inc., 11-bk-22258, 13-ap-00893, U.S. Bankruptcy Court, Middle District of Florida (Tampa).


Lisa Lopez says she would never have known exactly what happened to her mother without the video footage provided by a camera in her nursing home. She found her mother with multiple broken bones, including a broken hip, some time after the incident. She filed a negligence lawsuit against Concord Nursing and Rehab Center, now known as Aperion Care Oak Lawn and is an advocate for patients and families to have access to video monitoring of their loved ones.  See article at CBS News.

She isn’t the only one who thinks this is a good idea. There is rising pressure nationwide to allow families to use surveillance in nursing homes. Illinois Atty. Gen. Lisa Madigan, where the Lopez’s incident occurred is one high-level supporter. In September, she proposed legislation that would allow families to use video and audio monitoring equipment in nursing homes. She says the legislation comes from public complaints from those with loved ones in nursing homes.


The New York Post reported that NY Attorney General’s office is investigating a suspicious event which occurred in a Queens area nursing home. Robert Brogan was a patient suffering from dementia when he was injured on two separate occasions, resulting in jagged wounds to his head and arms. The wounds appeared to be defensive. On both occasions, the nursing staff did not have any explanation for how the wounds appeared.

After the second incident the home was told that they would be inspected the following Monday. Before inspectors arrived the staff was allegedly made to replace all wire hangers with plastic ones. An insider said they were trying to “cover their tracks.” The attorney general’s office has met with the family of Mr. Brogan and the investigation is ongoing.



ABC News reported that Preferred Care Partners Management Group L.P., one of the nation’s largest for profit nursing home chains, has been sued by New Mexico over inadequate resident care, alleging that thin staffing made it numerically impossible to provide good care. The nursing homes profited by skimping on staff “at the expense of the physical well-being of vulnerable nursing home residents.” The lawsuit  targets seven nursing homes run by Preferred Care Partners Management Group L.P. of Plano, Texas, a privately held company with operations in at least 10 states: Nevada, Arizona, Colorado, Florida, Iowa, Kansas, Oklahoma, Louisiana, Mississippi and Texas.

The nursing chain operator is structured as a manager overseeing a series of private partnerships. Its chairman, Thomas Scott, who was named defendant in the lawsuit, is the only listed individual investor in publicly available Medicare data. His company is considered to be the 10th largest nursing home chain in the country.  Since 2008, the company’s facilities have collected $229 million in revenue from taxpayers for the more than 1 million days residents cumulatively stayed there. To get that money, the nursing homes had to promise to comply with federal and state regulations requiring adequate care.

By calculating the total minutes required to properly care for residents and comparing them to the actual number of hours worked, the state found deficiencies in the total hours worked by nursing assistants of as much as 50 percent. Those numbers are especially useful because the nursing homes regularly boosted the number of nursing assistants who work during state inspections.  New Mexico’s case includes evidence such as confidential witnesses from the nursing homes’ own staffs alleging that managers recognized that nursing assistants were too overwhelmed to change diapers or help residents shower in a timely fashion. Sometimes there weren’t enough people working to help incapacitated residents eat and drink leaving residents “deprived of food and water.”

Cited as Confidential Witness #2, the daughter of one patient at a Santa Fe facility, Casa Real, said she repeatedly found her father unattended, dirty and complaining he was hungry. With the facility’s staff saying they didn’t have enough time, the woman took over the daily bathing and feeding that the nursing home was being paid by the government to do.

Preferred Care runs four of the seven New Mexico facilities with the worst grades for quality on Nursing Home Compare, a federal website that evaluates nursing homes. One of those facilities, Sagecrest Nursing and Rehabilitation, had more than six times the average number of health and safety violations for nursing homes nationwide. Another, Espanola Valley Nursing and Rehab, reported to Medicare that its certified nurse assistants had just 25 minutes a day to spend on each resident, according to federal data. The average nationwide is just under two and a half hours.

NPR reported on the federal lawsuit against two Watsonville, Calif., nursing homes which offers a new approach to dealing with the persistent problem of such facilities overmedicating their residents.  The lawsuit details multiple cases when the government says these drugs were inappropriately administered to patients.

For instance when an 86-year-old man identified in the lawsuit as Patient 1 was admitted to Country Villa Watsonville West, he could speak clearly and walked in under his own power. Within days the facility began giving him Haldol and Risperdal, drugs used to treat schizophrenia and bipolar disorder, and he became bedridden, stopped eating and developed bedsores and infections.  Antipsychotics like Risperdal and Haldol come with so-called black box warnings that say they could hasten death in elderly patients or people with dementia. Nevertheless, about a fifth of nursing home patients nationwide are prescribed antipsychotic drugs.

The U.S. attorney for Northern California claims that the two nursing homes provided “grossly inadequate, materially substandard and/or worthless services.” Meanwhile, they received about $20 million from Medicare and Medicaid for those services. So now the government wants its money back, and then some.

Deborah Pacyna, public affairs director for the California Association of Health Facilities, says that in the past couple years the federal government, in partnership with organizations like hers, has succeeded in reducing the use of antipsychotic drugs in nursing homes.  “But a lot of the regulators, a lot of our critics seem to be ignoring the fact that antipsychotics are being widely prescribed to patients who have dementia who are living at home, who are in the hospital or who are in assisted living settings,” Pacyna says. “Skilled nursing (homes) represents a fraction of those that have been impacted by this practice, yet we remain the focus.”


NPR continued its reporting on the problem of over-medication in nursing homes throughout the country.  One of the worst fears we have for our parents or for ourselves is that we will end up in a nursing home, drugged into a stupor. Almost 300,000 nursing home residents are currently receiving antipsychotic drugs, usually to suppress the anxiety or aggression that can go with Alzheimer’s disease and other dementia.  Antipsychotics, however, are approved mainly to treat serious mental illnesses like schizophrenia and bipolar disorder. When it comes to dementia patients, the drugs have a black box warning, saying that they can increase the risk for heart failure, infections and death.

Federal law prohibits the use of antipsychotics and other psychoactive drugs for the convenience of staff. It’s called a “chemical restraint.” There has to be a documented medical need for the drugs.  Professor Bradley Williams, who teaches pharmacy and gerontology at the University of Southern California, says antipsychotics should only be used as a last resort, and just for a month or so, before gradually being eliminated.  Antipsychotic drugs change behaviors, Williams says. “They blunt behaviors. They can cause sedation. It increases their risk for falls.” And in the vast majority of cases, the drugs aren’t necessary. “If you want to get to the very basic bottom line,” he says, “why should someone pay for something that’s not needed?”

In 2011, a government study found that 88 percent of Medicare claims for antipsychotics prescribed in nursing homes were for treating symptoms of dementia, even though the drugs aren’t approved for that. So the next year, the federal government started a campaign to get nursing homes to reduce their use of antipsychotics by 15 percent.  That 15 percent reduction was supposed to take less than a year. It took almost two. And it still left almost 300,000 nursing home residents on risky antipsychotic drugs. But Beatrice DeLeon is no longer one of them.


NPR followed up with an article explaining how nursing homes do not get penalized for over-medication that causes sedation, lethargy, and related health problems.  Antipsychotic drugs for older people with Alzheimer’s or other forms of dementia, can be deadly. The Food and Drug Administration has given these drugs a black box warning, saying they can increase the risk of heart failure, infections and death. Yet almost 300,000 nursing home residents still get them.  So in 2012, the federal government started a campaign to get nursing homes to reduce their use of these drugs. An NPR analysis of government data shows that the government rarely penalizes nursing homes when they don’t get with the program.

The approach being taught is sometimes called individualized care. The idea is that if nursing home employees know enough about a resident, they can figure out the reason behind challenging behavior and deal with it without resorting to antipsychotic drugs.  For example, what should you do if you’re caring for a resident who won’t go to sleep and wanders the halls all night?  Well, if you know he used to be a night watchman, you can just continue to treat him like one. The world won’t come to an end if you deviate from the schedule and let him sleep during the day.


NJ Spotlight reported on proposed legislation that would protect the vulnerable adults living in New Jersey nursing homes. Legislators want to safeguard nursing-home residents by giving them and their families the right to install video cameras and audio recorders in their rooms to help prevent instances of abuse and theft by staff members.  Advocates say measure would safeguard residents but nursing-home owners contend it would undermine trust and violate privacy.

The bill says the recording devices could be in either a visible or hidden location. The resident or authorized representative would inform the nursing home of the type of device being used and that the resident consented to the recording. The nursing home would be released from any civil liability for privacy violations related to the recording. The recording couldn’t start until the nursing home confirmed that it’s been notified. In addition, if the resident has any roommates, they would have to consent to the recording. The roommate could also allow video recording but prohibit audio recording, or require that the video camera be pointed away from them.

“This is about the choice of the resident and their families in their homes, because the nursing home is their home,” said AARP New Jersey Associate State Director Evelyn Liebman, adding that the hundreds of millions in taxpayer-funded Medicaid money that support nursing homes also warrant added transparency.  She said the tool would be particularly useful for family members who live far away and are unable to visit frequently.

Several states — including Maryland, New Mexico, Oklahoma, Texas and Washington – allow recording in nursing home rooms.


FITS News reported on new developments in an ongoing federal-state investigation of corruption at the S.C. State House.  Specifically, powerful S.C. ways and means chairman Brian White – who in addition to other things is reportedly being investigated for some sort of “residency” issue.  In reviewing past residences listed by White (he quit providing taxpayers with residency information in 2012), one of the properties we uncovered was owned not by him but by Brad Moorhouse – director of an Anderson County, S.C. nursing home that’s operated by the National HealthCare Corporation (NHC).

 James Randall Lee, a registered lobbyist and executive with the S.C. HealthCare Association, was one of the central figures in the Operation Lost Trust scandal – a federal sting that snared seventeen lawmakers in bribery-related corruption charges a quarter century ago.  Lee’s lobby – the nursing home industry – is responsible for appointing a member to the South Carolina Health Planning Committee, which is the entity responsible for administering the state’s health plan.  This planning committee is the entity responsible for administering the state’s Certificate of Need (CON) program – which decides where and how health care services are administered in this state.  Moorhouse …  is on that committee.

White’s yet-to-be-investigated 2011 campaign finance scandal (and his recent campaign payments to his wife’s charity) need to be addressed in relation to the ongoing corruption probe.


The Center for Public Integrity released a three-part investigative series on nursing home care.

Part One: Analysis shows widespread discrepancies in staffing levels reported by nursing homes

In part one, Jeff Kelly Lowenstein discovers discrepancies in staffing levels reported by nursing homes, finding that over 80% of facilities report higher levels of registered nurse care to the CMS Nursing Home Compare website for consumers than are reflected in their reports to Medicare.

 Part Two: Poorly rated nursing homes got HUD-guaranteed mortgages anyway
Part two exposes poorly run nursing homes across the country that have received low-cost, HUD-guaranteed mortgages after having received the lowest possible quality rating from the federal government on the Nursing Home Compare site.
Part Three: Nursing homes serving minorities offering less care than those housing whites
The third and final installment of the series exposes the racial disparities in registered nurse care levels in facilities across the country. Lowenstein found that although residents of all racial groups had lower registered nurse staffing levels, the discrepancy was particularly pronounced in nursing homes where the majority of residents were either black or Latino.
In addition to the three-part series, Lowenstein also wrote another article, Running a five-star nursing home, finding that facilities that received 5-star ratings on the Nursing Home Compare website had more registered nurses on staff and less staff turnovers than facilities with lower star ratings.