When Private Equity and Health Care Mix
Health Care

When Private Equity and Health Care Mix


The Washington Post’s Peter Whorisky and Dan Keating provide a heart-wrenching investigation into what happened at the HCR Manor­Care nursing home chain under the ownership of the Carlyle Group, a private equity giant:

“The number of health-code violations found at the chain each year rose 26 percent between 2013 and 2017, according to a Post review of 230 of the chain’s retirement homes. Over that period, the yearly number of health-code violations at company nursing homes rose from 1,584 to almost 2,000. … Counting only the more serious violations, those categorized as ‘potential for more than minimal harm,’ ‘immediate jeopardy’ and ‘actual harm,’ The Post found the number of HCR ManorCare violations rose 29 percent in the years before the [company’s March 2018] bankruptcy filing.”

“The rise in health-code violations at the chain began after Carlyle and investors completed a 2011 financial deal that extracted $1.3 billion from the company for investors but also saddled the chain with what proved to be untenable financial obligations, according to interviews and financial documents. … Shortly after the maneuver, the company announced hundreds of layoffs. In a little over a year, some nursing homes were not making enough to pay rent. Over the next several years, cost-cutting programs followed, according to financial statements obtained by The Post.”

Carlyle and HCR ManorCare representatives told the Post that care at the homes was never hurt by financial considerations and disputed the notion that quality at the homes had suffered.

Read the full story at The Washington Post.