Did Officials Funnel Millions Dollars Away Nursing Homes?

March 24, 2020

By Grossman Green PLLC

The plight of Indiana’s nursing homes is well-documented. We’ve all read the horror stories about dangerously understaffed care homes, with elderly residents left neglected, suffering from grave wounds or in a state that imperils their lives.

Yet according to a troubling new report, this did not have to be the case. It turns out millions of dollars meant to help support nursing homes has instead been siphoned away and used elsewhere.

Taking Advantage of A Loophole

These allegations were revealed in a recently published investigation by the Indy Star. According to the story, public officials with the state funneled money meant for nursing homes to county hospitals. They estimate at least $1 billion – but potentially more – was diverted through these means.

How did it work? As the report explains, officials with county hospitals took advantage of a Medicaid funding rule that provides extra money to nursing homes owned by a local government. Hospital systems, in response, bought nursing homes, then used that ownership to apply for these Medicaid funds.

However, rather than hiring more workers for the chronically understaffed nursing homes, they frequently used those funds to cover their hospital expenses. They also put the money toward building projects, including a rehab center, ambulance stations and medical facilities.

A Grim Eldercare Picture

There may very well be a legitimate need for some of the projects funded through this Medicaid regulatory loophole. But should it come at the expense of Indiana’s senior community, many of whom are already living in suboptimal conditions?

Consider this: Indiana received more money through this Medicaid funding rule in 2019 than any other state. Yet we rank 48th out of 50 when it comes to staffing levels at nursing homes, and the AARP considers our elder care system the worst in the nation.

Neglect and abuse in nursing homes can have horrific consequences. We entrust these care professionals to do right by our aging loved ones, not put them in danger. This recent investigation, however, shows even those at the top may not have taken that responsibility seriously.