New Report: “Pulling Back the Veil on Today’s Private Equity Ownership of Nursing Homes.”

Private Equity Stakeholder Project examines the private equity owners behind many US nursing homes in a new report: “Pulling Back the Veil on Today’s Private Equity Ownership of Nursing Homes.”

In the wake of a devastating year for nursing homes and other elder care facilities, private equity investment in the industry is facing renewed scrutiny for its impacts on patient care. Despite a fragmented and opaque landscape, the risks of private equity ownership of nursing homes have been well documented: academic studies and investigative reporting over the years have found higher patient mortality rates, reduced staffing, over-reliance on psychiatric medications, and reduced quality of care.

Despite the hundreds of billions of dollars of government money going into nursing homes, public understanding of nursing home ownership and operations is limited. In “Pulling Back the Veil on Today’s Private Equity Ownership of Nursing Homes,” Private Equity Stakeholder Project identifies the current largest private-equity-owned nursing home chains and, through case studies, considers the ways that profit-seeking tactics associated with private equity ownership may put patient care at risk.

The full report is available here.

Key Points

• Private equity investment in nursing homes is facing renewed scrutiny for its impacts on patient care. Academic studies and investigative reporting have found higher patient mortality rates, reduced staffing, overreliance on psychiatric medications, and reduced quality of care.
• Spurred by the devastating impacts of the COVID-19 pandemic on nursing home residents and workers, lawmakers are seeking ways to address the risks of private equity investment in nursing homes and increase transparency.
• Little is known about the firms that are currently invested in the industry. Much of the available data on private equity ownership nursing homes is now out of date as companies and facilities have changed hands. Complex business structures and the opaque nature of the private equity industry obscure nursing home ownership, making it difficult for regulators to adequately track impacts and assess compliance.
• This report highlights some of the known current private equity owners of nursing homes. Appendix A includes a more exhaustive list.
• Formation Capital is one of the biggest private equity investors in US nursing homes with at least 40,000 skilled nursing beds in 22 states. It operates primarily through Consulate Healthcare and Extendicare.
• Assured Healthcare Partners, formerly BlueMountain Capital, has several disparate nursing home companies and real estate holdings in Texas, Georgia, Michigan, California, Massachusetts, and Louisiana. Its Texas nursing home operator, Regency Integrated Healthcare Services, has recently come under fire for poor COVID-19 infection control.
• GI Partners owns Plum Healthcare, which operates in California, Utah, and Arizona and has approximately 5,000 beds and 11,000 employees. It is the second largest nursing home company in California.
• Portopiccolo Group owns various nursing home companies in at least eight states, including Peak Healthcare, Accordius Health, Pelican Health, Orchid Cove, and Clearview Health Management.
• In 2021, Pinta Capital Partners invested in Genesis Healthcare, taking the largest US nursing home operator private. Genesis operates more than 325 nursing homes and assisted-living centers in 24 states.
• Fillmore Capital Partners owns Golden LivingCenters, once a dominant player in the US nursing home industry whose market share has dwindled under Fillmore’s ownership. Golden Living now operates largely in Indiana.
• Tryko Partners, through its nursing home company Marquis Health Services, operates 4,500 skilled nursing and assisted living beds, as well as more than 2,000 independent living units, throughout the Mid-Atlantic and New England.
• McCarthy Capital owns LCS (Life Care Services), is one of the largest senior living companies in the US and owns and operates nursing facilities across the country.

The full report is available here.