Stern discusses nursing home reform bill

Henry Stern, Feel The Stern,
State Sen. Henry Stern. Courtesy photo

Sen. Henry Stern, D-Los Angeles, held a news conference Monday to discuss “critical” legislation that aims to make nursing homes more accountable and safer for residents.

Advocates for seniors and nursing home reform, and the bill’s co-sponsors AARP California, California Advocates for Nursing Home Reform and SEIU California, joined Stern, whose district includes western portions of the Santa Clarita Valley, for a livestreamed conference to review Senate Bill 650, which aims at requiring greater transparency on how nursing homes are spending funds.

The bill, authored by Stern, would require nursing homes to file annual consolidated financial statements, giving the state and the public more transparency for nursing home payments, as well as require nursing home management and property companies to submit audited financial reports.

“The way we’ve built our health care system has led to a dynamic where the vast majority of skilled nursing facilities in California are for-profit and are privately run,” Stern said. “What we found from both L.A. County’s audit, from state oversight, from investigative journalism … is that the corporate side of this industry, the larger for-profit institutions, are transacting in the billions, not the millions. … And then, we have very little idea about whether those transactions are actually being taken in a way that is fair, that prices aren’t being inflated, that money isn’t being wasted or profits aren’t being unjustly pocketed.”

It was the state auditor’s report Stern mentioned that, in part, triggered the bill, following the reportedly substantial increase in related-party transactions during a time in which serious injury, harm, impairment or death to residents increased by 35%.

“Hiding profits enables the industry to come back to the Legislature every few years and successfully asked for more money,” said Anthony Chicotel, staff attorney for California Advocates for Nursing Home Reform. “The nursing homes know their costs, they know their profits, and the state simply doesn’t. This lack of transparency results in the state getting ripped off, paying for the private jets and vacation homes of nursing home owners, instead of the staff and resources critical for resident well-being.”

Blanca Castro, AARP California’s senior manager of advocacy, called SB 650 “one of the most important nursing home reform bills,” allowing better transparency on where funding given to nursing homes is going.

“We know that the devastating impact that COVID had on nursing home residents and workers really put a spotlight on this crisis, (but) at the same time, as the pandemic fades from the headlines, we can’t allow the needs of nursing home workers … and the aging population in California to be forgotten,” added Arnulfo De La Cruz, of SEIU Local 2015, which represents thousands of long-term care workers.

This is especially important this year as billions of the state’s budget are invested into skilled nursing facilities so that the money actually goes to the caregivers and seniors who need it, according to Stern.

SB 650 is part of a larger legislative package, dubbed “The PROTECT Plan,” which is set to launch an intensive campaign to increase nursing home accountability, as California Department of Public Health data reports that nearly one in four COVID-19 deaths in California has been in a nursing home, which equates to 23% of the state’s total deaths.

“Nursing home residents who survived the pandemic and the family members of the deceased residents are rightfully frustrated and angry about the preventable conditions in nursing homes that led to this enormous death toll,” Chicotel added.

SB 650 passed the Assembly Health Committee Tuesday and is set to go on to the Assembly Appropriation Committee in August.

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