How REITs Evade Accountability for Nursing Home Neglect

Real estate investment trusts (REITs) are increasingly owning and managing nursing homes, assisted living facilities, and long-term care centers across the United States, raising concerns about the quality of care residents receive. While these financial entities often claim to be passive landlords, investigations reveal that many exert significant influence over facility operations, including staffing levels and management selection, yet frequently deny responsibility when care standards fail.

A 2024 lawsuit filed by Leslie Adams against a rehabilitation center where his mother, Shirley Adams, died from infected bedsores highlighted the risks associated with corporate ownership of care facilities. The court awarded the family $17 million in damages, finding that neglect and poor medical oversight contributed to her death. Despite the verdict, Adams said the family has struggled to collect the award, citing complex ownership structures and legal shields used by parent companies.

According to reporting by KFF Health News and corroborated by federal data, over 1,500 nursing homes nationwide are now owned by private equity firms or REITs, a number that has grown steadily since 2010. These investors often acquire facilities through complex corporate layers, making it difficult to trace accountability when residents suffer harm. In many cases, the REITs appoint third-party managers but retain control over key financial decisions, including budgets for staffing, training, and equipment.

Research published in Health Affairs in 2023 found that nursing homes owned by private equity were associated with higher rates of preventable hospitalizations, increased use of antipsychotic medications, and lower staffing levels compared to nonprofit or government-run facilities. The study analyzed Medicare data from over 15,000 facilities and concluded that financial pressures to maximize returns often conflict with the resource-intensive needs of long-term care.

Federal regulators have noted the trend. In 2022, the Government Accountability Office (GAO) reported that ownership opacity in the nursing home sector hinders oversight and enforcement. The Centers for Medicare & Medicaid Services (CMS) has since proposed rules to increase transparency about facility ownership, requiring operators to disclose parent companies and investment structures as part of their licensing applications.

Industry representatives argue that REITs bring needed capital to aging infrastructure and that poor outcomes are not inherent to their ownership model. However, consumer advocacy groups, including Long Term Care Community Coalition and Families for Better Care, maintain that without strong regulatory safeguards, profit-driven ownership increases the risk of neglect, especially in facilities serving Medicaid-dependent residents.

As of April 2026, legislative efforts to strengthen oversight are underway in several states, including California and New York, where bills have been introduced to limit private equity ownership of nursing homes and mandate minimum staffing ratios. At the federal level, lawmakers have called for hearings on the impact of financialization in healthcare, though no major reform has yet passed Congress.

For families like the Adamses, the human cost of opaque ownership remains profound. While legal victories can provide a sense of accountability, advocates say systemic change is needed to ensure that financial interests do not compromise the dignity and safety of those relying on long-term care.