Financialization of the US Nursing Home Industry

How financial profiteering has reshaped long-term care and jeopardized the well-being of nursing home residents.

Nursing homes care for some of the nation's most vulnerable citizens. They are also increasingly controlled by financial actors whose priorities lie far from the bedside. In Financialization of the US Nursing Home Industry, Laura Katz Olson and Michael K. Gusmano examine how for-profit companies—and increasingly private equity firms and real estate investment trusts (REITs) with complex ownership structures—have transformed long-term care into a vehicle for profit extraction.

Drawing on extensive case studies of major chains and mid-sized operators, the authors trace the industry's consolidation over decades and document how financial engineering—asset stripping, related-party transactions, real estate manipulation, and deliberate labor cost cutting—has reshaped nursing home operations. Chronic understaffing, declining care quality, opaque ownership arrangements, and repeated bankruptcies plague a system designed to maximize returns. The book places these developments in historical and policy context, showing how federal and state government policies enabled substandard conditions even as public funds—primarily Medicare and Medicaid—now supply roughly three-quarters of industry revenue. The COVID-19 pandemic exposed long-standing systemic obstacles to decent care, revealing how financial priorities can have deadly consequences for residents and frontline caregivers alike.

This essential book offers scholars, policymakers, students, and advocates a comprehensive account of how the nursing home industry works—or doesn't work—and why meaningful reform will require structural change. Care for powerless older people, the authors argue, must be treated as a public responsibility rather than a private investment strategy.