Outsourcing and the Dangers of Related Party Transactions
Nearly three quarters of the nursing home chains in this country outsource many nursing home operations to other companies they control. Management, physical therapy, and drug and other care services are increasingly outsourced. Contracts with related companies accounted for $11 billion of nursing home spending in 2015 — a tenth of their costs — according to financial disclosures the homes submitted to Medicare. These outsourcing arrangements produce profits for the controlling holding company but result in care deficiencies, underfunding, and understaffing at the patient level. The Alameda County and California nursing home abuse attorneys at Evans Law Firm Inc. have seen firsthand how patients may suffer from these arrangements. Our attorneys represent elderly victims of nursing home abuse in Alameda County and throughout California and believe nursing homes need to be held accountable for incidences of abuse within their premises in all case, including those where the patient suffers from an outsourced service. If you or a loved one has been the victim of nursing home abuse in Alameda County or elsewhere in California call the Evans Law Firm today at (415)441-8669, and we may be able to help.
Patients Suffer From Outsourcing
Patients may often suffer from the understaffing which arises from outsourcing of goods and services. Homes that did business with sister companies employed, on average, 8 percent fewer nurses and aides. Complaints of neglect and abuse are higher where these outsourcing arrangements are in place as well. Studies show that nursing homes with related companies were fined 22 percent more often for serious health violations than independent homes, and penalties averaged $24,441 — 7 percent higher. The corporate structure can also make a patient’s recovery for injury all that more complicated.
Recovering for Loss from Corporate Webs
These complex corporate webs are intended in part to shield the true owners of the overall business from liability when a patient is neglected or abused. Often, the local nursing home is run as an underfunded business and even the ground and building where the nursing home is located may be owned by other affiliated companies protecting corporate assets from creditors. When a nursing home is sued for the abuse, injured residents and their families have a much harder time collecting money from the related companies — the ones with the full coffers. Courts set a high bar for plaintiffs to bring these ancillary companies into their cases. To bring related companies into a lawsuit, attorneys must persuade judges that all the companies were essentially acting as one entity and that the nursing home could not make its own decisions. Often that requires getting access to internal company documents and emails. Even harder is holding owners personally responsible for the actions of a corporation — known as “piercing the corporate veil.” The nursing home attorneys at Evans Law Firm have experience with just these kind of cases and work to pursue recovery for injured seniors from those who should be held responsible for the injury.
If you or a loved one has suffered from nursing home abuse in Alameda County or any California county, contact Alameda County and California nursing home abuse attorney Ingrid Evans and the other attorneys at the Evans Law Firm at (415) 441-8669, or by email at <a href=”mailto:email@example.com”>firstname.lastname@example.org</a>. Our attorneys have wide experience with cases of nursing home abuse. We can help guide your case through a jury trial or toward an equitable settlement. We handle cases involving physical and financial elder abuse, qui tam and whistleblower law, nursing home abuse, whole life insurance and universal life insurance, and indexed, variable, and fixed annuities.