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A recent article in The Prospect details the “extraordinary” lawsuit filed by hundreds of New York nursing homes against the state health commissioner in an effort to block a new law mandating that nursing homes “spend a majority of their revenue on patient care.” As The Prospect explains, the lawsuit alleges that the law unconstitutionally seizes nursing homes’ private property for a public purpose, a rationale described by the article as “preposterous.”
In their lawsuit, the nursing homes state that “if the new law had been in effect in 2019, the government would have clawed back $824 million in ‘constitutionally protected’ profits from the nursing homes, one-third of which would have been coughed up by the top 40 most profitable homes alone,” according to The Prospect. Ron Kim, a state assemblyman representing Queens who introduced the bill that became the law, said in a statement that the figure represents “the amount of money they’re supposed to be spending on care that they’re instead extracting in profits.”
The funds which nursing homes claim they would unconstitutionally lose to the state under the new law comprise roughly $1 billion that state health authorities could use “to recruit, train, and deploy extra nursing staffers to struggling facilities if it actually enforced the law.,” The Prospect argues. In fact, the state could use “the $510 million in profits detailed by the plaintiffs’ 239 most profitable properties” to pay salaries and benefits for 5,600 more registered nurses than are currently employed in New York’s nursing homes. As the report notes, the argument that the law would deprive nursing homes of hundreds of millions in revenue also appears to contradict an argument frequently trotted out by industry groups—that nursing homes are “egregiously underfunded and barely able to break even.”
A large section of The Prospect’s report examines some of the more profitable nursing homes listed among the lawsuit’s plaintiffs. The most profitable of these is the Pavilion at Queens, a New York City facility with 302 beds. A 40% stake in the facility is owned by the daughters of Benjamin Landa, the part-owner of a Florida nursing home chain, “whose documented crimes range from human trafficking to flagrant Medicare and Medicaid fraud to staffing his homes so minimally that patients regularly die from literally rotting in their own filth,” according to The Prospect, which goes on to note: “In a single year, a single nursing home owned by Landa’s family took in some $13.1 million in revenues that would have been “confiscated” under the safe staffing law, and there are hundreds more homes in the broader Landa empire where that came from.”
More information on the lawsuit seeking to block nursing home reform in New York, and the nursing home owner/operators behind it, is available via The Prospect.
The attorneys at the Law Offices of Thomas L. Gallivan, PLLC work diligently to protect the rights of nursing home residents. Please contact us to discuss in the event you have a potential case involving neglect or abuse.
