Brius has the worst patient care record among California’s largest nursing home chains, according to a scathing report issued by the California State Auditor on May 1. The 82-page report also criticized state regulators for failing to safeguard patients from unscrupulous operators providing substandard care.
California State Auditor Elaine Howle found that the California Department of Public Health has failed to perform necessary inspections or issue timely citations for substandard care. She also criticized the department for failing to use consistent and transparent parameters in licensing homes.
“Together, these oversight failures increase the risk that nursing facilities may not provide adequate care to some of the state’s most vulnerable residents,” Howle wrote.
Among California’s three largest nursing home chains, Brius racked up .52 citations per 100 nursing home beds. That was nearly double the next two leading operators and nearly 24 percent higher than the statewide average.
Should state legislators adopt the Auditor’s recommendation to reduce Medicaid funding to operators with poor patient care records, Brius would lose $7.4 million in state funding, according to the audit.
“This audit is a scathing report and points out significant deficiencies that exist in Brius skilled nursing facilities in California.” State Sen. Mike McGuire told the Eureka Times-Standard.
McGuire and Assemblymember Jim Wood requested the audit after reviewing data compiled by the National Union of Healthcare Workers showing that in 2015 Brius owner Shlomo Rechnitz had his homes pay for $67 million worth of goods and services from 65 companies also controlled by Rechnitz.
“It’s no surprise that if you siphon money away from elderly residents, they’ll get poorer care,” NUHW President Sal Rosselli said. “We applaud the Auditor for recommending that the state now establish new laws to hold nursing homes accountable so our elderly receive the care they need and deserve.”
The audit confirmed NUHW’s research, and found that from 2007 through 2015, Brius increased its related-party expenses per patient bed by about 600 percent, according to the audit.
While these insider transactions are currently legal, Michael Connors of the California Advocates for Nursing Home Reform told California Healthline that they ultimately “siphon off money intended for care in order to pad and hide profits.”
Assemblymember Wood has already drafted legislation aimed at increasing transparency of these insider transactions, and the audit recommends that the state amend reporting protocols to mandate that operators detail every one of their transactions and provide their related companies’ profit and loss statements.
“It is impossible to get an accurate view of [Brius’] total profit and loss statement because they did not include all related companies that work within their health care realm,” McGuire told the Times-Standard.
The auditor directed much of its criticism at the state health department, which it held responsible for continued “substandard quality of care” at nursing homes.
Citations issued by the state declined 34 percent between 2006 and 2015, while federal citations increased 32 percent during the same time period, the Auditor found. State regulators only issued citations for 15 percent of the most serious deficiencies it identified and failed to perform relicensing inspections on nursing homes as required under state law.
The auditor also found that the state failed to issue citations in a timely manner and failed to collect fines. Although the Department of Public Health assessed more than $28 million in citation penalties between 2006 and 2015, it collected only $17 million, the auditor found.
Wood told the Times-Standard that it was “very, very disturbing” that the Department of Public Health was not holding nursing homes accountable. The failure to issue citations, as well as delays in issuing them, are particularly worrisome, he said. “They are not doing their job.”
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