One of the main chains of nursing homes in the US, with facilities in 28 states, is Life Care Centers of America (LCCA). Its founder, chairman, CEO, and sole owner is Forrest Preston. His net worth has been reported variously as $1.2 billion, $2.1 billion, or $3.2 billion.
How Preston has managed to make so much money is somewhat of a mystery, because all LCCA’s published accounts show only a very narrow margin between revenue and expenditure. The clue to the mystery lies in ‘creative accounting.’ ‘Expenses’ include large sums paid to other companies that also turn out to be wholly owned by Preston, who is therefore merely moving money from one pocket to another. Only secret ‘consolidated financial statements’ clearly show what is going on.
In 2006 Preston told employees to send Medicare fraudulent claims for reimbursement. In 2016, after whistleblowers exposed the scheme, LCCA settled the resulting government lawsuit for $145 million — evidently only a small fraction of the amount stolen. As usual in such cases, the company did not admit any wrongdoing. Preston never saw the inside of a prison. Prison is strictly for small-time thieves.
In terms of suffering knowingly inflicted, however, massive theft of public funds is not Preston’s worst crime. His worst crime is the deliberate understaffing of his nursing homes in order to increase profits. Too few staff are hired. Patient-staff ratios are too high. This means that staff are overworked and prone to errors and accidents while even the most urgent needs of patients are often neglected.
For example, patients may be left in bed for long periods in wet and even soiled diapers. Unable to get the timely help they need to continue breathing, especially at night when understaffing is especially severe, they may die alone of asphyxia. Some patients suffering from dementia are violent and delusional. They can assault other patients (and staff too). When this happens staff are rarely on hand to intervene.
Admittedly, Preston is far from the only culprit. Such deliberate understaffing seems to be standard practice in the care industry – not only in nursing homes for the elderly but also in institutions for care of the physically and intellectually disabled and the mentally ill. And the situation in many other countries, despite varying arrangements for the provision of care, is as bad as in the United States.
In the US, provision of care, although largely funded through government programs, is ‘outsourced’ to private companies. Government regulation of such companies is in practice very weak. It is hard to imagine any arrangement more susceptible to abuse.
In Canada, by contrast, care facilities are run directly by provincial governments. Yet there is still severe understaffing, with the resulting neglect. Understaffing may not be deliberate, but wages and conditions are just too poor to attract and keep enough staff. Basically it is a matter of allocating sufficient funds.
In Ontario workers at nursing homes came together with relatives of patients to campaign for improved staffing. In the runup to the provincial elections, Progressive Conservative governor Doug Ford claimed to support their cause, but once re-elected he evaded the issue. He did promise to expand care facilities, but in the absence of other measures this would make the staffing situation even worse. Any activists who naively took Ford at his word had forgotten his record as a politician always ready to cut social spending on behalf of his capitalist masters:
Immediately after taking office in 2018, Ford proposed to cut 3,475 Ontario teaching jobs over four years to save $292 million a year. Ford also cancelled the Green Ontario Fund residential rebate program, which included a $100 million fund for public school repair, free prescriptions for people aged under 25 years, and an initiative to add indigenous peoples content to school curriculum, and eliminated free tuition for low-income students.
In a socialist society, it will be possible to devote a large share of the human energy released by automation and demilitarization to care for those who need it – both to the full staffing of special facilities and to assistance for people who choose to care for their elderly or disabled relatives at home.