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Va. Nursing Homes' Settlements Hidden
U.S. Attorney Defends Confidentiality

By Gilbert M. Gaul
Washington Post Staff Writer
Monday, August 8, 2005

In April 2004, the U.S. attorney's office for eastern Virginia agreed to what it calls an innovative settlement with a 177-bed nursing home in Fredericksburg. Instead of slapping Beverly Healthcare with a big fine for allegedly providing poor care, it required the owners to invest that money in nursing home improvements, including hiring more employees and a consultant.

All of that might be useful information for patients and families considering the facility. But as part of their settlement, government attorneys agreed not to publicize the case.

It wasn't the first time. In the past four years, the U.S. attorney's office in Alexandria has settled federal allegations of poor care with the owners of seven Virginia nursing homes and two management companies.

In each case, the government agreed to keep the settlements confidential unless the nursing homes decided to go public. Only two have.

Without a promise of confidentiality, U.S. Attorney Paul J. McNulty said, the nursing homes would not agree to the settlements. "Consequences of publicity have to be taken into consideration," he said.

Beverly Healthcare's owners agreed to release details of the settlement after a Washington Post reporter requested it from the U.S. attorney.

Although it is not uncommon for private lawyers to keep settlements secret, the idea that federal prosecutors would withhold information about nursing home quality has confused and angered some advocates.

"I didn't know there were settlements," said Joani F. Latimer, the state's long-term-care ombudsman. "This is the first I've heard of it."

David L. Sadowski, executive director of the Crater District Area Agency on Aging, which provides the elderly with services in the Petersburg region, said: "I'm surprised the U.S. attorney would do that.

"What bothers me is when bureaucrats make these decisions and keep them in some file drawer. It's defeating to the public."

The Virginia settlements appear to run counter to a recent federal effort to make nursing home care more transparent. Since 2003, Medicare has published online information about staffing levels and deficiencies at http://www.medicare.gov/NHCompare . In addition, a few U.S. attorneys in other states have listed nursing home settlements on their Web pages.

The issue of disclosing settlements under the False Claims Act, the law used in the cases against the nursing homes, has attracted attention in Congress. Sen. Charles E. Grassley (R-Iowa) introduced a bill this year that would require the Department of Justice to report details of settlements exceeding $100,000.

Armed with the False Claims Act, a Civil War-era law, a small number of U.S. attorneys have charged dozens of nursing homes with cheating the government by failing to provide residents with quality medical care.

"If a person has horrible bedsores that become infected or isn't being fed because there isn't enough staff, then the nursing home isn't providing the services that it's being paid for," McNulty said.

He added that the Virginia settlements are part of a four-year-old effort by his office to shift the focus of nursing home cases from paying fines to improving care. "The principal difference between this approach and others . . . is using those monies to improve the facilities themselves," he said.

About half of the U.S. attorney's settlements in Virginia included a fine, McNulty said. Still, he said, the emphasis is on working with the owners to fix the problems, "as opposed to collecting monies into the federal treasury."

When asked to disclose the settlements, McNulty's office said they were confidential and could not be released without the permission of the nursing homes. The office eventually released two of the nine agreements but would neither provide the others nor name the nursing homes involved. "All I can tell you is what we've made public," McNulty said.

The Beverly Healthcare settlement required the owners to spend $315,000 to hire five additional caregivers and an outside expert in aging issues.

Most of the problems at the facility -- which had previously paid $17,420 in federal fines, according to federal records -- stemmed from inadequate staffing, McNulty said. "At Fredericksburg, we saw what happens due to the lack of attention to people," he said.

As part of the settlement, Beverly Healthcare's owners denied any wrongdoing.

In the other case made public, the owners of Chippenham Manor Nursing Home in Richmond agreed in January 2002 to pay the government $275,000, hire a registered nurse to monitor care, conduct training on wound care and maintain a minimum number of staff employees to settle allegations of inadequate care. The owners, who later sold the facility, denied that the care was inadequate.

Sadowski said all federal actions against nursing homes should be disclosed -- including on Medicare's Web site. "How can they not make the settlements public?" he asked. "Isn't this exactly what the public needs to know?"

Alice H. Hedt, executive director of the National Citizens' Coalition on Nursing Home Reform, said, "The public has a right to know if a facility has been sanctioned, what the sanction was and what it was for."

Hedt added, "To me, a fine is one of the few things in our system that is a very clear indicator that the facility has experienced very serious problems."

In Pennsylvania, the U.S. attorney for the eastern region has posted on its Web site all 14 of its settlements with nursing homes. Former assistant U.S. attorney David R. Hoffman, the architect of the agreements, would not comment on his Virginia counterparts. But speaking generally, Hoffman said he thought disclosure was important.

"Knowledge is not a bad thing. In fact, it's a good thing," Hoffman said.

"I think as much information as you can have in making a selection of a nursing home is critical," he said. "That's one of the reasons we make public all of our nursing home settlements. It's important for the consumers, who have a stake in this, and to keep the homes honest."

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