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California Accuses Nation's Largest Nursing Home Chain of Manipulating Ratings System

State claims Brookdale Senior Living inflated staff hours, illegally discharged residents

A logo sign outside of the headquarters of Brookdale Senior Living in Brentwood, Tennessee on February 4, 2017. Photo by Kristoffer Tripplaar *** Please Use Credit from Credit Field ***(Sipa via AP Images)
Sipa USA via AP

Nursing homes owned by the largest senior living operator in the U.S. illegally discharged residents to free up beds for patients who would bring in more money and gave false information to regulators to inflate their quality ratings, according to a lawsuit filed this week by California's attorney general and district and city attorneys in the state.

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The suit is among the first to target a high-profile nursing home operator for giving inaccurate information to the federal Centers for Medicare & Medicaid Services (CMS), which regulates nursing homes. It accuses 10 California nursing facilities owned by Brookdale Senior Living — a $4 billion company that operates approximately 800 nursing, senior living and long-term care facilities across the country — of falsifying the reported working hours of registered nurses and staff.

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CMS uses that information to award quality ratings on a five-star scale that help consumers compare options and make long-term care decisions for themselves and their family members. By submitting inflated staff hours to make it look like it was providing a higher standard of care, the suit alleges, Brookdale received “higher star ratings than it deserved."

"It lured individuals to its facilities through false promises about providing the highest-quality care,” California Attorney General Xavier Becerra said Monday in a statement about the lawsuit.

Until 2018, nursing home staff hours were largely self-reported by individual facilities. CMS has since switched to a payroll-based system that is supposed to be harder to falsify. The lawsuit accuses Brookdale of falsifying hours under the old system and says it “continues to provide misleading information to CMS and continues to manipulate its star rating by falsifying its payroll-based journals.” The facilities involved received four- and five-star ratings from CMS (five is the highest rating).

"It can be very scary, and very challenging, for a family to make a decision about long-term care. When they see a ‘five-star rating,’ they assume it means their loved one will get the very highest standard of care,” says Bill Sweeney, senior vice president of government affairs at AARP. “It is outrageous that nursing homes would manipulate the data to give themselves better ratings."

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The suit also accuses the 10 Brookdale nursing facilities of illegally discharging patients without giving them 30 days’ notice in order to “fill [their] beds with residents who will bring in more money.” Prosecutors say the facilities prioritized Medicare recipients over residents on low-income assistance like Medicaid, since Medicare pays more. The suit alleges that Brookdale facilities in some cases discharged residents when their Medicare coverage ended without giving them sufficient notice, without notifying a long-term care ombudsman — state-sponsored representatives for residents — and without a formal discharge plan.

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Brookdale has denied wrongdoing and was not “engaged in intentional or fraudulent conduct,” according to a statement from the company. “Publicizing unproven allegations is reckless and undermines the public's confidence in a service necessary to the care of elderly individuals,” it said.

The lawsuit is another black eye for a nursing home industry that has been battered over the past year, as COVID-19 had infected more than 1.3 million long-term care residents and staff, killing more than 174,000 as of March 7. Mike Wasserman, a geriatrician and past president of the California Association of Long Term Care Medicine, says one of the few positives from the pandemic is a new public awareness of problems that have long plagued the industry.

"I don't know if Brookdale did what they are purported to have done, but that stuff happens. This stuff has existed forever,” he says. “I hate to say it, but the only reason we're hearing about it is that we just had a pandemic that we'll ultimately find killed close to 200,000 nursing home residents."

The suit also heaps scrutiny onto the CMS rating system days after The New York Times published an investigation into how nursing facilities have gamed its five-star ratings system. The investigation was cited Wednesday during a Senate Finance Committee hearing, with Sen. Mike Crapo (R-Idaho) saying the investigation “questions the objectivity and accuracy of the CMS star ratings system."

A separate Brookdale facility in Lexington, Kentucky, is named in the Times investigation and is alleged to have misrepresented hours worked by nursing staff to Medicare officials. In a statement to the Times, Brookdale denied wrongdoing.

Separately, the AARP Foundation is leading two lawsuits against Brookdale's assisted-living-facility operations in Florida and North Carolina. The facilities are alleged to have fallen short of the staffing and care standards reported in marketing materials to consumers. In one of the suits, Brookdale is accused of operating a “system of chronically understaffed assisted living facilities that routinely and as a matter of practice fail to provide sufficient staffing."

If you or a loved one is a resident of a Brookdale assisted living facility in North Carolina or Florida and want more information about the lawsuit, contact the AARP Foundation: litigation@aarp.org.

Andrew Soergel covers nursing homes and federal and state policy for AARP. He was previously a senior economics writer at U.S. News & World Report and was awarded an Economics of Aging and Work fellowship through the Associated Press-NORC Center for Public Affairs Research at the University of Chicago.