A complex bankruptcy case about a private-equity nursing home chain prompted an unusual court ruling last month, when a Texas judge denied the sale of Genesis HealthCare to itself, and instead insisted on more oversight and transparency.
Private equity ownership of nursing homes is increasing, and as Kay Lazar of the Boston Globe reported, Genesis and other PE firms have a history of violations, noncompliance and secrecy. In this How I Did It, she explains what’s at stake, why it matters, and what may happen to the hundreds of residents of New England long-term care facilities.
This interview has been edited for brevity and clarity.
How long has Genesis been on your radar and what were some of the red flags that put it there?
Genesis first popped up on my radar about a decade ago, when I kept hearing about quality-of-care problems with its nursing homes while the company was selling off a number of its facilities in Massachusetts. Genesis had more than doubled in size in the previous four years to become the largest owner of nursing homes nationally and in Massachusetts. I did a story in 2016 about how the quality of care at its Massachusetts nursing homes, as well as the nurse staffing hours had declined. (I used data from the federal website Medicare Compare). You can find reams of data at this site, not only about nursing homes in your state, but also about hospitals, home health services and other health-related institutions.
Fast forward to last fall, when a source contacted me and said Genesis, which had declined precipitously since 2016, [had] filed for bankruptcy and was attempting a sketchy insider deal to essentially buy itself back at a bankruptcy auction. But as part of this sketchy process, the company was attempting to sell more than a billion dollars of legal claims against it back to itself as well, and then, as it emerged from bankruptcy officially not have the money to pay those debts — essentially trying to rid itself of the claims filed by vendors and families who had sued over injuries and deaths of residents in the company’s care.
How common are private-equity owned nursing homes in New England? Why is this an issue?
It’s hard to say the precise number, though that might be a good focus for a future project. Certainly I am running into them more frequently than I did even a few years ago. The federal Government Accountability Office (also a good source for health data) estimated in a 2023 report that at least 5% of nursing homes nationwide were owned by private equity, but the GAO acknowledged that was likely an undercount because, it said, it even found it tough to discern which homes were owned by private equity using data collected by the Centers for Medicare & Medicaid Services, because nursing home companies often failed to properly report their owners to the federal agency.
Private equity ownership is a growing concern because an increasing number of studies have found that the companies tend to suck profits out of the nursing homes, while depleting staffing levels and quality of care. Then the companies file for bankruptcy, and buy more nursing homes to essentially wash, rinse, and repeat that cycle.
What does this company’s bankruptcy filing mean for residents and families of their facilities?
The months-long process — the company filed for bankruptcy in July 2025, and does not expect to finalize the deal until March — likely means staff have been leaving and care will suffer. A terrific recent report from the National Bureau of Economic Research found that bankruptcy filings in nursing homes immediately increase staff turnover, and those who leave are replaced by new workers with fewer skills. Bankruptcies also increase hospitalizations by 4% among residents within 90 days of admission, it found.
Privately-owned nursing homes often contract with other companies who also have the same owners or are part of the same larger corporation. Can you explain some of the issues/problems involved in this type of set up?
This is a hornet’s nest of an issue and all too common. These “related parties”—with some or all of the same owners as the nursing home company — are ubiquitous in the industry. Typically, a privately-owned nursing home will form an affiliated or related party(with a different name) to manage the nursing home, and then the nursing home will form another company (also with a different name from the management company) to provide nurse staffing, and potentially form yet another related company (again, with a different name than the other related parties) to provide food service, or health insurance for its employees or other services.
The inherent and very real problem with this is that the nursing home company will then pay its “related” companies above market rate for these services (all considered legal), essentially siphoning off money that should be going to patient care, but instead is going to the nursing home owners. Forming so many “related party” companies with so many different names makes it very hard for often overworked and under-staffed state oversight agencies to track where all the money is going. It also helps shield the nursing home company in lawsuits.
Are there other major players or chains that reporters should be keeping an eye on?
Life Care Centers of America is a national chain that has had a lot of problems. Another chain, mostly on the West Coast, that also has had its problems is New Generation Healthcare. The company, under a newly-formed private equity affiliate called 101 West State Street, LLC, just won the bid to buy the troubled Genesis HealthCare chain of 175 nursing homes (which are nationwide) so this is a “new” company to watch for sure.
It’s not always easy to find ownership, since that is often hidden behind shell companies. What’s your advice on how journalists can try to follow the money?
One of the best sources of ownership and other data can be the nursing home cost reports that federal regulators (Centers for Medicare & Medicaid Services) require nursing homes to file each year. CMS in the Trump era has been even less responsive to requests than in the past. These reports are also incredibly dense and complicated, so I have often sought the nursing home cost reports required by our state. Most states require nursing homes to file these cost reports as well, though our state, Massachusetts, has been less than diligent in auditing and monitoring these reports. So ask your department of health or the agency in your state that inspects nursing homes which agency or division oversees the state cost reports. In Massachusetts, for instance, our health department inspects nursing homes, but our Center for Health Information and Analysis regulates the cost reports.
I have found that lawyers who typically handle elder law — indeed some focus primarily on litigation against nursing homes and assisted living facilities — are incredibly helpful. They tend to work closely with forensic accountants to find where a nursing home company the lawyers are suing is hiding its money. In my experience, both the lawyers and this type of accountant have helped walk me through the thicket of private equity to unearth data on specific nursing homes.
Also, get yourself on the Long Term Care Community Coalition’s email mailing list. This is a nonprofit that produces incredibly helpful investigative reports on nursing homes that often provide state-level nursing home data. They also are helpful in steering you to other good sources. Finding families or residents at nursing homes can be challenging, as often families are reluctant to speak publicly for fear of retribution for their family member who is in a nursing home. But sometimes nursing homes have family councils that speak for families or can connect you to a family. Your state long-term care ombudsman should be able to help you find out whether a nursing home has a family council.
I have also reached out to elder law attorneys to see if they perhaps are representing families in legal action against a specific facility and they often have been helpful in connecting me with someone. You can look through your state’s court system — hopefully dockets are online — to see if the nursing home you are interested in is facing legal action and, if so, can get lawyers and contact info there.
Kay Lazar covers public health and the science of aging at the Boston Globe. Her stories have investigated patterns of profit and subpar care at nursing homes, explored Alzheimer’s disease, and exposed excessive antipsychotic use in nursing homes, among many other public health issues. You can reach her at kay.lazar@globe.com.
