When Wall Street Takes over Nursing Homes, Grandma Gets Left in the Cold. Literally.

When 85-year-old Eleanor Hallowell fell out of her wheelchair in a Voorhees, New Jersey nursing home, overworked and underpaid caregivers came up with a quick solution: Restrain Hallowell with a tightly-bound bed sheet and then forget about her. This brutal measure ensured that the weak hospice patient wouldn’t try again to stand up from her chair. Only 2 months later, in November of 2015, Hallowell was dead – a fact that is not surprising given the atrocious care the grandmother received.

Nursing home horror stories like Hallowell’s abound.

In 2014, a nursing home resident in Fayetville, Arkansas died of an oozing bedsore “the size of [a] fist.” According to the deceased man’s son, his father was so dehydrated when he died that he most likely hadn’t received food or liquid in 4 or 5 days.

If you thought it couldn’t get any worse, guess again: In 2014, 2 caregivers in Winter Haven, Florida were videotaped beating a 76-year-old man suffering from Alzheimer’s.

Unfortunately, these tragic stories are all too common. In fact, nursing home abuse is a rampant problem that touches the lives of millions of people throughout America. A study by the U.S. House of Representatives found that elderly abuse occurred at 1 in 3 nursing homes. Out of 2,000 nursing home residents surveyed in a different study, 44 percent said they had been abused while 95 percent said they had been neglected or witnessed another resident being neglected. Furthermore, according to the 2014 Nursing Home Report Card, 90 percent of all nursing homes were cited for violating state or federal laws.

The Data Is Impossible to Ignore

As study after study concludes that elderly citizens are abused and neglected in the very facilities designed to care for them, the question emerges: How can this happen? How can nursing homes promise to care for needy residents and then forsake them to misery, depression, and death?

The root of the problem lies in the fact that most nursing homes are big businesses striving first and foremost to maximize profits. Just how big? In 2015, estimated revenues for the nursing home market reached an astonishing $136 Billion. The industry has become so profitable that Wall Street investors have poured money into the sector, purchasing nursing homes and then cutting costs wherever and however the opportunity presents itself. Many of these investment companies are interested in buying nursing homes, reducing expenditures, and then quickly reselling the purchases for huge turnaround gains.

The results have been predictable: when care facilities focus primarily on improving the bottom line, the quality of life for residents dramatically suffers. In 2007, the New York Times reported that residents at nursing homes owned by private investment firms suffered significantly more from depression and preventable health problems than did residents at not-for-profit nursing homes.

While the tragic stories involving negligent or abusive care at large, for-profit nursing homes abound, a small number of nursing home success stories have shown what happens when management considers people before profits. These stories have proven that smaller, more compassionate elderly care facilities can provide happier and healthier lives for elderly citizens. Most importantly, these stories have illustrated the way forward for nursing homes hoping to reverse the frightening direction in which the industry is heading.

A Better Kind of Nursing Home

The rumbling of change has begun in the American nursing home industry. A few companies have recently established innovative assisted-living homes that set a new precedent in terms of quality of life for residents. These new facilities are based on the principle that residents are happier when living in a home-like setting with compassionate and competent staff, personal freedoms, and personal space.

One of the major game changers has been The Green House Project, a national non-profit organization founded by physician Bill Thomas in 2003. Thomas’s vision was to turn the institutional model upside down, creating facilities that had the feel of a home instead of a cold, sterile institution. According to the Green House Project website, “Green House homes are a way of life for the elders thriving in them, the teams working in them, and the healthcare providers who believe in them.” Green House homes “nurture elders in a circle of care” and “enable deep relationships between elders and caregivers.”

Each Green House home is small. There are only 10-12 residents living in each home, although each resident has a private bedroom and a private bathroom. Central to each house is a large kitchen and living room where residents may congregate to eat meals together.

Studies have shown that people are healthier and happier living in Green Homes compared to traditional nursing homes. Residents have reported a higher quality of life, greater autonomy and privacy, and lower rates of hospitalization. Staff, also, were happier in their jobs than staff in other nursing homes, and were more likely to retain their positions.

93-year-old Josephine DeLillo enjoys the compassionate and attentive care given to her as a resident in a Green House home. “One of the aides is like my daughter,” DeLillo recently told the New York Times. “ [The aid] washes and dresses me. If I want something to eat during the day, it will be made for me.”

A New Hope, but Still a Long Way to Go

There are currently 174 Green House homes in use with another 186 in development. That means that there are approximately 1,700 beds in Green House homes. Compared to the 1.5 million beds being used in traditional nursing homes, the Green House Project has yet to make a major change for the vast majority of American nursing home residents.

According to the Kaiser Family Foundation, only 2,000 of the 16,000 nursing homes in America have less than 50 beds, and the majority have over 100 beds. Following Green House Project logic, that means that most nursing home residents are likely to live in facilities that are short-staffed with underpaid, unhappy, and unqualified employees. In such situations, it is no surprise that abuse and neglect happen all the time.

Such large institutions (here is a list of the 50 largest) will always be more likely to pack as many residents in while cutting costs in order to maximize profits. At such large institutions, the comfort and happiness of elderly residents are more likely to be scrapped by the ownership just so they can make an extra buck. At such large institutions, families will continue to be horrified when they discover their loved ones were the victims of abuse or neglect.

Surveying the nursing home industry at-large, it’s easy to see what’s going on: Nursing homes across America have been hijacked by big businesses who care very little for the welfare of the most vulnerable and needy of us. And, in fact, investors – sickeningly – might even view such people as new sources of revenue. If nothing changes, defenseless men and women will continue to be tied to their wheelchairs, left hungry and thirsty in beds they can’t get out of, and physically beaten by unqualified workers who often deserve imprisonment over employment.

Until the Wall Street investment companies get out of the industry and smaller not-for-profit’s like the Green House Project move in, our elderly will continue to suffer. Unfortunately, many more will have to suffer and prematurely die before change comes to the majority American nursing homes.

Sokolove Law Team

Contributing Authors

The Sokolove Law Content Team is made up of writers, editors, and journalists. We work with case managers and attorneys to keep site information up to date and accurate. Our site has a wealth of resources available for victims of wrongdoing and their families.

Last modified: September 25, 2020