New York’s long-term care facilities are entrusted with the critical responsibility of providing care and dignity to some of the most vulnerable members of society. However, recent legal actions have exposed troubling practices that prioritize profits over people, resulting in neglect, mistreatment, and fraud. Two high-profile cases—the $45 million settlement with Centers for Care and the lawsuit against the Villages of Orleans—have highlighted systemic issues, including insufficient staffing and financial exploitation through related-party transactions.
This blog will explore the importance of sufficient nursing staff in long-term care facilities, examine the implications of these recent legal actions, and discuss the need for greater oversight and transparency in New York’s nursing home industry.
Why Sufficient Staffing is Essential in Long-Term Care
Staffing levels in nursing homes are directly linked to the quality of care residents receive. Adequate staffing ensures that residents' basic needs—such as hygiene, nutrition, and medical care—are met promptly and consistently. Insufficient staffing, on the other hand, can lead to:
Neglect of Residents: Residents may go without proper hygiene, feeding assistance, or medication, leading to severe health complications.
Increased Mortality: Studies have shown that low staffing levels correlate with higher mortality rates in nursing homes.
Emotional Harm: Residents may feel abandoned or neglected, contributing to depression and anxiety.
Staff Burnout: Understaffed facilities overburden their employees, increasing the risk of mistakes and turnover.
New York has implemented minimum staffing requirements to address these issues. Nursing homes must provide an average of 3.5 hours of direct care per resident per day, with specific allocations for registered nurses and certified nurse aides. However, as recent cases reveal, compliance with these requirements is often inadequate.
Centers for Care: A Stark Reminder of Staffing Failures
In November 2024, New York Attorney General Letitia James announced a $45 million settlement with Centers for Care, which operates several nursing homes, including a facility in White Plains. The lawsuit alleged years of "egregious" resident mistreatment due to chronic understaffing and mismanagement.
Key findings from the case included:
Inadequate Hygiene Care: Residents suffered from untreated rashes, infections, and even gangrene.
Poor Staffing Practices: Chronic understaffing led to delays in addressing residents’ basic needs.
Misappropriation of Funds: Medicaid and Medicare funds intended for patient care were allegedly diverted for other purposes.
As part of the settlement, $35 million will be allocated to improving staffing and resident care. This case underscores the dire consequences of prioritizing profits over patient well-being.
The Villages of Orleans: Exposing Financial Exploitation
The lawsuit against the Villages of Orleans in western New York extends beyond allegations of neglect. It also sheds light on the financial practices that exacerbate staffing shortages and substandard care.
Related-Party Transactions and Fraud
The lawsuit accuses the Villages’ owners of engaging in "related-party transactions," where the facility purchased goods and services from companies owned by the same group of individuals. These transactions included:
Predatory Lease Agreements: The Villages paid exorbitant rent to a related real estate company, Telegraph Realty, which netted $1.6 million in profit in 2020 alone—a 59% profit margin.
Excessive Consulting Fees: The facility paid millions in fees to a related consulting company, CHMS Group, which further drained resources from resident care.
According to the lawsuit, these practices diverted $18.6 million over seven years—22% of the facility’s total revenue—away from patient care. Much of this money came from Medicaid and Medicare, violating the legal obligation to use these funds for resident services.
Broader Implications for New York Nursing Homes
Related-party transactions are common in New York’s for-profit nursing homes. A recent Empire Center study found that 72% of these facilities engaged in such practices in 2020, with related companies accounting for two-thirds of their collective profits.
If the attorney general’s legal arguments hold up in court, hundreds of other nursing homes may face similar scrutiny, forcing them to reassess their business models and prioritize patient care.
Oversight Challenges and the Role of Regulation
The cases against Centers for Care and the Villages of Orleans reveal significant gaps in oversight and enforcement:
Health Department Oversight: The New York State Department of Health is responsible for regulating nursing homes, including monitoring their financial reports and care standards. However, the Villages' excessive profits and chronic deficiencies went unaddressed for years.
Ineffectiveness of Penalties: Fines imposed for care deficiencies are often too modest to deter neglect. For example, the Villages was fined $87,000 in 2021 for COVID-19-related failures, a fraction of its annual profits from rent payments.
Lack of Transparency: Related-party transactions often occur behind closed doors, making it difficult to assess their impact on care quality.
Legislative Action
Attorney General James has called for stronger transparency requirements and enforcement mechanisms, including:
Minimum Staffing Ratios: New York has enacted minimum staffing laws, but their implementation has faced delays due to legal challenges.
Financial Transparency: Requiring nursing homes to disclose related-party transactions and justify their costs.
Stronger Penalties: Increasing fines for care deficiencies and financial mismanagement.
What These Cases Mean for Families
For families with loved ones in nursing homes, these cases highlight the importance of vigilance and advocacy. Families should:
Research Facilities: Review ratings from the Centers for Medicare & Medicaid Services (CMS) and investigate any history of violations.
Monitor Care: Visit regularly, ask questions about staffing levels, and observe how staff interact with residents.
Report Concerns: File complaints with the New York State Department of Health if you suspect neglect or mistreatment.
How Leitner Varughese Warywoda Can Help
At Leitner Varughese Warywoda, we are committed to holding nursing homes accountable for neglect and financial misconduct. Our experienced attorneys can:
Investigate allegations of neglect or mistreatment.
Pursue legal action against facilities engaging in fraudulent practices.
Advocate for families seeking justice for their loved ones.
If you believe your loved one has suffered due to insufficient staffing or financial exploitation in a New York nursing home, contact us today at 212-671-1110 or visit lvlawny.com to schedule a free consultation.
Conclusion
Adequate staffing in long-term care facilities is not just a regulatory requirement—it’s a moral obligation. The recent cases against Centers for Care and the Villages of Orleans illustrate how neglecting this responsibility can lead to devastating consequences for residents. They also reveal the financial exploitation that often accompanies substandard care, underscoring the need for greater transparency and oversight.
Families, regulators, and legal advocates must work together to ensure that nursing homes fulfill their promise to provide compassionate, high-quality care for New York’s most vulnerable residents.
