NURSING HOMES

Kamala Harris’s campaign proposal to create a home care benefit through Medicare would expand upon already existing Medicaid funding for in-home health aides. Home health care provision has grown dramatically in recent decades, a rise often connected to the poor quality and expense of nursing homes—whose strain is indexed by the rush of private equity into the sector—and the overall dysfunction of American elder care.  

In a 2023 chapter, BRENDAN BALLOU examines private equity ownership in nursing homes, which has been associated with over 20,000 premature deaths over twelve years:

“By selling ManorCare’s real estate, Carlyle was able to recover the money that it had put into the deal. In other words, with this sale alone, Carlyle had basically broken even and still owned an enormous nursing home chain. But selling ManorCare’s property put a terrible strain on the business. ManorCare needed real estate to operate, and with the sale, ManorCare was obligated to pay nearly half a billion dollars a year in rent to occupy the buildings it was already using. On top of this, under the terms of the deal, ManorCare was still responsible for paying the buildings’ insurance, upkeep, and property taxes. This meant that ManorCare now had all the obligations of owning its properties, with all the costs of renting them. Carlyle extracted money from ManorCare in other ways too, including a $61 million transaction fee for buying the business itself. It also took about $27 million over nine years in advisory fees: fees that ManorCare paid for the privilege of being owned by Carlyle. Like the sale-leaseback, these too are common tactics of the private equity industry writ large. Unsurprisingly, the business suffered. After the sale of its property, ManorCare made hundreds of layoffs. It instituted cost-cutting programs, and some of its nursing homes were unable to afford their rent. Health code violations rose 26 percent between 2013 and 2017, three times faster than at all other nursing homes.”

+  “In 2019, 68 percent of nursing home profits were hidden by tunneling to related parties through inflated transfer prices.” By Ashvin Gandhi and Andrew Olenski. Link. And see Atul Gupta et al. for evidence linking private equity ownership in nursing homes to increasing mortality rates among patients, and how private equity acquisitions can align with the interests of investors and consumers. Link, link.

+  “From its 2021 peak to the end of 2023, total healthcare-related private equity deal value fell 60.4 percent—reaching its lowest point since 2016.” By Jessica Hamlin. Link.

+  For the definitive book on home care in the United States—one of the fastest growing occupations in the twenty-first century—see Caring for America: Home Health Workers in the Shadow of the Welfare State by Eileen Boris and Jennifer Klein. Link. 

NEW RESEARCHERS

Corporate Politics

REILLY STEEL is a PhD candidate in political science at Princeton University
. In a 2024 paper, he leverages new data on the campaign contributions of over 90,000 executives and directors at over 9,000 firms to trace the ideological fracturing of the US corporate elite.

From the paper:

“The possibility that corporate elite preferences are driving firm-level political activity raises additional positive and normative questions about whether corporate involvement in politics is good for shareholders, society, or both, as well as enduring questions about the purpose of the corporation. The perceived growth in corporate political activity in recent years has prompted renewed scholarly interest in these longstanding issues. For those who favor shareholder primacy, one question is whether the alignment between corporate elite political preferences and firm-level political activity reflects managerial agency costs or instead serves the long-term business interests of the firm. When average board, c-suite, and senior manager ideology are separately included as independent variables in the regression models, only the board and senior manager variables consistently predict whether the firm signs the HRC statement. That is, the political preferences of the group arguably most likely to extract private benefits of control—the c-suite—are the worst predictor of firm-level political activity.”

+++

+  “Traditional ways to dismantle illegal market behaviors will not affect its hold on the AI value chain.” New on PW, Cecilia Rikap on the structure of Google’s monopoly and the limits of antitrust. Link.

+  “As the Chinese leadership pricks the country’s dangerous real estate bubble, exporting high-value clean tech is a key part of the government’s strategy for maintaining growth.” New on The Polycrisis, Kate Mackenzie and Tim Sahay on the geoeconomic contest between the US and China. Link.

+  In a new paper, Thiago R.T. Ferreira, Nils Gornemann, and Julio L. Ortiz examine how household excess savings after the onset of Covid-19 dampened the effect of monetary policy on economic activity and inflation. Link.

+  “The push continues to build up BRICS Pay, a platform aimed to circumvent the US dollar taking advantage of digital and decentralized technologies.” By Sarang Shidore. Link.

+  Chris Bragg and Julia Rock examine Mayor Eric Adam’s indictment and the Turkish government’s influence in NYC politics. Link.

+  “Syrian and Palestinian populations comprise both migrants and refugees. These sections are doubly disadvantaged within Lebanon’s working population.” By Nadia Bou Ali and Ray Brassier. Link.

+  Rachel M. Cohen on the CTC and the Democratic party’s care economy agenda. Link. And in PW, see Andrew Yamakawa Elrod’s sweeping analysis of Bidenomics. Link. 

+  “Between the triumphal entry of the revolutionaries into Havana in early January 1959 and the Cuban Missile Crisis that came to a head in October 1962, Khrushchev’s agenda to advance what Czechoslovak reformists would call a few years later ‘socialism with a human face’ came unstuck. Bureaucratic resistance combined with his own impetuousness and overreach are familiar explanations, and they are not wrong. Not for nothing did the phrase Pravda used in its editorial announcing Khrushchev’s ouster in October 1964—’hairbrained scheming, immature conclusions and hasty decisions and actions divorced from reality’—become inextricably associated with him. But a less top-down perspective would cite “Bloody Saturday,” the massacre of striking electric locomotive factory workers in the southern Russian city of Novocherkassk. There, on June 2, 1962, in front of the city party headquarters on Lenin Square, soldiers fired on thousands of assembled workers, killing twenty-four and wounding scores of others.” By Lewis H. Siegelbaum. Link.

Each week we highlight research from a graduate student, postdoc, or early-career professor. Send us recommendations: editorial@jainfamilyinstitute.org