Scandal in Plain Sight – Virginia’s Failed Regulation of Law-Avoiding Nursing Home Owners

by James C. Sherlock

One of the most important and heart-wrenching decisions families make for their elderly loved ones is whether they are able to keep them in their homes as they get older and sicker.

Sometimes that is not feasible for a long list of reasons in each case.

More than 30,000 Virginians live in nursing homes.

Both the federal government and Virginia regulate them.  The Virginia Department of Health, for both the Commonwealth and the federal government, inspects.

We should be able to expect patients to receive at least basic standards of care. A high percentage in Virginia have not .

In a five-star system, the Centers for Medicare and Medicaid Services (CMS) rates 98 of Virginia’s 289 nursing homes at one star – defined as much below average. More than a third.

Nationwide, only the worst 20 percent receive a one-star rating.

The last time I reported, in October of 2021, those figures were 54 one-star facilities out of 288. Nineteen percent.  So some of our nursing homes have gotten precipitously worse.

The ratings are backward-looking a couple of years, so the measured declines discussed here did not start recently.   By definition of the way that Medicare compiles records and assigns scores, some have been bad for a long time.

People have suffered and died from the lack of proper care and effective oversight.

Ownership of many nursing facilities, especially the worst ones, has become a shell game subject to high-frequency shifts of ownership and changing facility names.

The game exceeds the demonstrated ability of governments to track those changes for purposes of public information. That game has to at least complicate regulation if not thwart it.

But for whatever reason, nursing home regulation has failed utterly in Virginia. It is past time to fix it.

CMS Ratings. Any new search by families for nursing homes should start with the CMS star ratings, as does this article.

CMS rates those facilities which accept government insurance, which is nearly all of them, and the common rating source makes them comparable.

The overall “star” ratings (1 thru 5) are compiled from a combination of individual star ratings for health inspection reports, staffing data, and health care quality measures.

The CMS rating system is outstanding.  There is no other worth consulting.

Licensing. Virginia’s Department of Health licenses nursing homes. It has the authority to sanction consistently bad facilities and bad operators.

Financial data. The Commonwealth provides different data that are equally important to a thorough search by families — and by the General Assembly.

The Virginia Department of Health (VDH) contractor for medical data management is It provides, among other unique services, information on the financial performance of medical facilities in the state.

A nursing home that routinely loses money, assuming the financial reporting is accurate, which is a known problem in facilities owned by some private equity firms, is a risk regardless of the latest CMS star ratings.

But, for whatever reason, the financial data published by are preposterously out of date. The data posted on February 28 of this year are from fiscal year 2021. They are better than nothing.

Facility name and ownership problems. A search of federal and state nursing home records available to the public shows a significant pattern of discrepancies of facility names and ownerships among:

  • for the state;
  • CMS Medicare Compare data for the federal government; and
  • the current actual ownership and names of facilities.

My research shows a large majority of Virginia nursing homes caught up in that specific form of chaos have changed names, ownership or both in the past couple of years.

CMS and don’t even agree on how many nursing homes there are in Virginia. They clearly use different criteria. We just don’t know what the differences are.

To pick but two examples, The Glebe in Daleville and The Culpeper in that town offer skilled nursing, rehabilitation and memory care. The Glebe has an overall 5 Star rating from CMS. The Culpeper three stars. But the list of nursing homes does not recognize a nursing home at either address.

That is because designates those facilities as long-term care facilities. Interesting, but not helpful to those turning to its nursing home page.

Families should note that in cases in which and CMS have different naming and/or ownership data for nursing homes at the same location, the investigation shows that the CMS data are inevitably more recent.

Take the nursing facility at 600 Walden Road in Abingdon.

  • shows it to be named Abingdon VA Opco LLC owned by the Portopiccolo Group;
  • CMS shows it to be Choice Healthcare at Abingdon owned by 600 Walden Opco LLC; and
  • Today it is Deer Meadows Rehabilitation and Nursing, owned by Eastern Healthcare Group of Montvale New Jersey. That name is not reflected in the public records of either the federal or state governments.

Rapid assembly of large Virginia chains. Eastern Healthcare Group suddenly owns 14 nursing homes in Virginia, primarily from buying out Portopiccolo Group’s Virginia facilities.

Flushing, New York’s Hill Valley Healthcare, equally suddenly, owns 18 nursing homes in Virginia, closing the purchases on most of them in January.

Eastern and Hill Valley each recently bought portfolios containing some of the worst nursing homes in the state as rated by CMS. That can be a good thing if each has the resources and the will to invest in upgrading staffing and facilities.

But we don’t know if that is what will happen. Nor, it appears, does the government of Virginia.

Eastern and Hill Valley indeed may represent upgrades from the owners they replaced. The good news, if it can be couched as such, is that in the case of most of the nursing homes in those two portfolios, it would seem difficult to make them worse.

So, Godspeed to the new owners.

Question for government. We must question whether the government agencies themselves know who owns the facilities in a timely manner.

  • How soon are they notified after a sale?
  • Is the state notified before a sale? If so, does the state have any authority to vet new buyers?
  • What happens when a new owner takes over a one-star rated facility? How does that affect regulation activities?

We ask those questions because there are ownership groups, some of whom have  operated in Virginia, notorious for:

  • buying nursing homes;
  • stripping staff to far below CMS-required levels regardless of the effects on Medicare Compare star ratings;
  • pocketing the profits; and
  • within a couple of years reselling facilities at a higher price based on the higher cash flows.

That has been done widely in the Commonwealth.

Bottom line. Government agencies which we count on for both nursing home information and regulation appear unable to reliably provide either.

VDH inspects nursing homes for CMS, for Pete’s sake, so we at least should be able to count on them having the same information and that information being up to date when offered to the public and the General Assembly.

Doesn’t seem too much to ask. But it has proven to be.

More importantly, the worst nursing home operators appear to stay ahead of the consequences of the violations of government policy by flipping their properties and moving on.

Sick elderly people and their families are unaware of anything other than that their care has become dystopian in the switches.

Recommendations. If current laws have been broken, Commonwealth’s Attorneys should prosecute. If regulations have been broken, sanction the owners who broke them.

Regardless, a thorough review and report by the Department of Health and the Department of Medical Assistance Services (DMAS) of their nursing home regulatory, oversight and public information programs is necessary prior to the next General Assembly session to determine how to improve them.

Virginia needs mechanisms to:

  • track and report nursing home ownership and facility names in near-real time;
  • stop Medicaid reimbursement of nursing homes in violation of health regulations; and
  • block Virginia acquisitions by ownerships with bad track records or insufficient assets.

The VDH already has the authority to remove the licenses from operators who disregard regulations as a business model.

If legislation or regulation changes are necessary, propose them.  In a later article, I will offer regulatory changes that do not require new laws.

In the meantime, Virginia’s elected constitutional officers and General Assembly members may wish to examine campaign donations and stop taking/refund money from Virginia’s worst nursing home operators.

This is the first in a series on this issue.