Nursing home that either merged or were acquired by major chains between 1993 and 2010 had more health deficiency citations than independent ones, according to a study published Monday in Health Affairs, though researchers said facilities that sold to chains were already struggling with quality issues.
On average, 1,509 nursing homes experienced a transaction during each year of the study. There were three types: a chain's acquisition of a nursing home, a chain's divestiture of a nursing home that then became independent, and chain-to-chain transactions -- acquisitions, sales or mergers across chains, which were the most common.
There was a lot of ownership-swapping taking place during that time, especially among the biggest chains. Only two of the 10 largest chains in 1993 had not experienced a change in ownership by 2010.
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The data suggests the lowest-quality nursing homes were targeted for merger or acquisition, with independent nursing homes that were acquired having far more deficiency citations than other nursing homes that operated independently during the same timeframe. Facilities that were owned by one chain and then acquired by another also had higher deficiencies compared to other chain-owned nursing homes.
In spite of all those transactions, the overall share of chain-owned nursing homes remained fairly constant from the late 1990s through 2010 -- what the authors called a "chaotic steady state."
According to the study, one of the key issues arising from the study is the accountability of nursing homes to public insurers and consumers.
"If an owner anticipates owning a nursing home for only a short period of time, its strategic emphasis may be different from that of an owner with a longer term business plan in regard to patient selection, quality, and capital investment," the authors said.
Policy-wise, they suggest continuing to invest in data to track chain restructuring. The Affordable Care Act requires nursing homes certified by Medicare or Medicaid to have ownership information available for inspection; several states have also introduced websites with detailed ownership information for consumers.
One idea, they say, is to release detailed chain ownership information on Nursing Home Compare, the government's report card website, which they say would increase transparency.
[Also: Tracking 2015 mergers and acquisitions]
Similarly, the Centers for Medicare and Medicaid Services or other states could adopt the Massachusetts policy of requiring public notification of an impending sale to all interested parties, including nursing home residents, their families, staff members, workers unions and elected state and local officials.
More broadly, the authors said, "states and the federal government could play a more active role than they have to date in scrutinizing ownership changes (for example, incorporating company-level performance measures into licensure approvals)."
From a regulatory standpoint, CMS could analyze performance or survey facilities as a group within a particular chain, thereby forcing companies to further consider quality after any chain transactions, the authors said.
Twitter: @JELagasse