John O'Connor
John O’Connor

Senior living operators are advised to take stock of what the federal government did to nursing homes yesterday. Why? Because this latest development just might offer a glimpse of what’s ahead for you.

In a bid to improve ownership transparency in the skilled care sector, the feds posted a final rule calling for more disclosures.

This move follows years of criticism against opaque ownership structures among skilled care operators. One major beef: It can be challenging if not nearly impossible to determine who actually owns facilities. Another suspicion is that many facilities have essentially become a destination point for other goods and services controlled by the same operators. Both of these practices have had a deleterious effect on care quality, critics claim.

I’m not going to attest to the legitimacy of such concerns. But it’s undeniable that they exist.

This latest government scrutiny extends to ownership involvement across several dimensions, including financial control, property leasing, stake percentages and the provision of various services.

This week’s final rule, according to Centers for Medicare & Medicaid Services officials, responds to growing concerns about the quality of care in nursing homes, particularly those owned by private equity companies and investment firms.

CMS Administrator Chiquita Brooks-LaSure emphasized the move is underpinned by a desire to furnish stakeholders, including residents, their families, researchers and regulators, with transparent information for informed decision-making.

“Taking steps to help consumers to learn more about the owners of a nursing home will allow them to make the choice that best meets their needs,” added HHS Secretary Xavier Becerra in a statement.

This final rule is happening as more senior living operators expand their portfolios and business interests. Or to put it more bluntly, it’s happening at a time when more senior living organizations are establishing the kind of unclear ownership structures that landed nursing homes in hot water.

To believe the feds will never be interested in taking a closer look under your hood is not merely wishful thinking. It’s dangerous thinking.

John O’Connor is editorial director for McKnight’s Senior Living and its sister media brands, McKnight’s Long-Term Care News, which focuses on skilled nursing, and McKnight’s Home Care. Read more of his columns here.