Democratic lawmakers are calling out soaring executive compensation at three for-profit nursing home providers as the industry fights new minimum staffing requirements that apply to virtually every facility in the United States.
The executive pay was revealed in a letter sent Friday evening to the CEOs of Brookdale Senior Living, National HealthCare and Ensign Group. Signed by Sens. Elizabeth Warren (D-Mass.), Bernie Sanders (I-Vt.) and Richard Blumenthal (D-Conn.) and Rep. Jan Schakowsky (D-Ill.), it was first shared with The Hill.
Over the past five years, the three companies collectively paid their top executives and directors more than $250 million, ballooning from $36.9 million in 2019 to nearly $66.8 million in 2023, according to the lawmakers’ analysis.
Ensign accounted for the vast majority of that increase, the lawmakers found, as compensation more than doubled to $50.2 million for five executives and five directors in 2023 from $24.4 million for five executives and six directors in 2019.
The Biden administration unveiled the new requirements in April over opposition from the nursing home industry and lawmakers on both sides of the aisle. Critics argue the federal standard is too expensive and onerous as the industry struggles to recover from the pandemic, potentially forcing facilities to shutter.
In the letter, the Democratic lawmakers pushed back on three critics of the new requirements, pointing out that executive pay at Brookdale Senior Living, National HealthCare and Ensign Group has increased “while at the same time claiming that you cannot afford to meet new minimum staffing requirements.”
“New revelations that your companies collectively increased their executive pay by nearly 25 percent just last year, combined with the record-high profits your companies touted in the first two quarters of 2024, reveal once again that you have plenty of money available to provide high-quality care – but instead are using it to enrich yourselves and other executives,” the lawmakers wrote.
Seven Brookdale executives and seven directors collectively made nearly $10.9 million last year, up from $6.9 million between five executives and nine directors in 2019. Five directors and seven executives at National HealthCare received $5.7 million in 2023, up from $5.6 million in 2019.
Executive pay made up virtually all the total compensation, with total pay to directors each of these years accounting for around $1 million or less, a Warren spokesperson said.
The lawmakers called it “insulting” that the for-profit nursing home industry “appears to prefer lining the pockets of its executives and shareholders rather than creating sustainable working conditions for nurses and staff,” and urged the companies to “rethink your opposition to this rule.
When reached for comment, a Brookdale spokesperson provided excerpts from the company’s response to a letter Warren and other lawmakers sent in May after finding these three companies paid out a combined $650 million in dividends, buybacks and compensation to top executives between 2018 and 2022.
Chad White, Brookdale’s executive vice president, general counsel and secretary, pushed back on “inaccurate” statements by the lawmakers, saying the company “has not issued a dividend to shareholders since 2008” and that its “last share repurchase occurred in March 2020, at the very beginning of the COVID-19 pandemic.”
“Importantly (and contrary to the assertions in your letter), our concerns in this regard are not related to potential direct financial impacts on Brookdale’s skilled nursing business, particularly given the very small portion of our business that is comprised of skilled nursing,” White wrote in the letter.
Neither Ensign nor National HealthCare responded to requests for comment.
According to an American Health Care Association survey of 441 nursing home providers released in March, 99 percent of nursing homes had open jobs, with 89 percent hiring for registered nurse positions.
The survey also found 72 percent of nursing homes say their current staffing levels are lower than they were before the pandemic.
“[T]he rule does nothing to help solve the challenges our country is facing with regard to our growing senior population,” White wrote in May, calling on the Biden administration to work “with Congress to fund and support initiatives to expand the healthcare workforce that specializes in providing care and services to seniors, including private pay senior living providers.”
The lawmakers said in their new letter that “this industry argument ignores the fact that the primary problem appears to be that nurses in nursing homes are not being paid enough.”
On average, nursing homes turn over half their staff within a year, the Economic Policy Institute think tank noted in its public comment on the proposed rule last November, cited by the lawmakers.
“Without a national staffing minimum in place, the for-profit nursing home industry can continue to shovel profits to its executives and shareholders at the expense of patient lives,” the Democrats wrote.
