Manor Care Draws Criticism for Reorganization Efforts
Manor Care will be reconfigured into separate operational and real estate entities with various distinct corporate subsidies after its $6.3 billion acquisition by Carlyle Group is completed, according to documents filed with health regulators in more than 26 states, the Washington Post reports.
Manor Care, the nation's largest nursing home chain, operates more than 500 skilled nursing and rehabilitation centers, assisted-living facilities, outpatient rehab clinics, and hospice and home care offices in 30 states. The company said the changes will make its operations more streamlined, according to the Post. The company still will comprise more than 300 corporate entities, according to Manor Care general counsel Richard Parr.
Critics say similar restructuring efforts have been used by other corporations to minimize liabilities and protect them against inquiries by regulators regarding standards of care and changes made to improve profit margins. Andrew McDonnell, a spokesperson for the Service Employees International Union, said, "The record with nursing homes is to use these kinds of structures and lack of transparency to avoid taking responsibility when taking control of nursing homes."
Toby Edelman of the Center for Medicare Advocacy said, "This is quite troubling because the point of doing this is for a company to protect themselves from liability." Parr said each unit of the newly organized company will be liable for the care given at its specific facilities. Last month, two Congressional committees announced plans to investigate business practices at privately owned nursing facilities.
Rep. John Dingell (D-Mich.), chair of the House Energy and Commerce Committee, said the panel will hold a hearing on the matter in coming months (Kang, Washington Post, 11/8).