Nursing home industry is very profitable

Brandunson.com has an article about Extendicare REIT reporting fourth quarter profits of $10.5 million.  Revenue in the quarter totalled $469.7 million, up from $453 million.

Extendicare REIT, through its owned subsidiaries, operates 269 nursing and assisted living facilities in North America as well as medical specialty services.

For the full year, Extendicare earned $70.4 million or $1 per diluted share on $1.8 billion in revenue. That compared with a loss of $35.7 million or 53 cents per diluted share on $1.73 billion in revenue in 2006. Shares in Extendicare, which released its results after the close of markets, were down 18 cents at $11.30 on the Toronto Stock Exchange.

This shows that nursing homes are very profitable even during bad economic times.  It also shows there is no need for ridiculous caps on damages.

Nursing Home Reform Bill

U.S News & World Report has an article on the proposed Nursing Home Reform Bill.  Below is a summary of the article.

The byzantine world of the corporate nursing home industry may soon become a whole lot clearer. Republican Sen. Chuck Grassley and Democrat Sen. Herb Kohl seek to force nursing homes to provide more information about ownership and accountability.

The Nursing Home Transparency and Improvement Act would force nursing homes to clearly state ownership—something that has become increasingly complicated to figure out, as private investment groups have bought up nursing homes and enveloped them in labyrinthine legal structures. The opaque ownership makes it difficult for regulators to identify parties responsible for poor care and unfairly shields owners from complaints of neglect and abuse.

The bill also seeks to standardize complaint forms, improve reporting on staffing information, and replace some self-reported information with that gathered by independent audits. The primary goal is to make it easier for the public to compare nursing homes, a growing concern as baby boomers age.

The American Association of Homes and Services for the Aging, an industry group that represents not-for-profit nursing homes, applauds the bill.  The nonprofit sector is already required to produce information about finances and ownership to the IRS to qualify for its tax status.

The fight over nursing home reform will continue as the bill works its way through Congress. Proponents like the bill's chances, in part because it's authored by the respected Grassley, who is the senior Republican on the Senate Finance Committee.  Even the AAHSA wants some provisions removed, such as the bill's call for an increase in civil penalties of up to $100,000 for a deficiency resulting in death. Delays likely to come from those and other proposed changes mean, for those waiting for nursing home reform, it could be 21 years and counting.

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