FTC chair hears concerns about Sauk County nursing home sale

This story was produced in partnership with Wisconsin Watch.

Federal Trade Commission Chair Lina Khan made a surprise visit to Baraboo on Thursday, speaking at an event organized by Sauk County residents who sought to ratchet up pressure on state regulators to block the county’s sale of the nursing home it operates.

The Sauk County Board of Supervisors voted last month to sell Sauk County Health Care Centers to for-profit Aria Healthcare. The nursing home was built in 2008, but the county has operated a care facility in some form since 1871 — using it to treat diseases ranging from smallpox in the early 1900s to Alzheimer’s in the 1990s, according to the county’s website. 

Opponents fear that selling the public run nursing home will worsen care. 

Aria, which did not respond to multiple requests for comment, operates three Wisconsin facilities in the Milwaukee area. One facility received 39 federal health citations in a year, nearly 30 more than the U.S. average.

“The concerns that you’ve raised about what you worry will happen if this sale goes through is very salient for us,” Khan said.

Three other county boards in Wisconsin have attempted to privatize public facilities this year. Experts say nonprofit and government-owned facilities nationwide are exploring sales due to increasing labor costs and other challenges worsened by the pandemic.

“We’ve been watching with some alarm as more and more mergers and consolidation mean that fewer and fewer players are coming to control important parts of the health care system,” Khan said. 

The FTC, an independent agency that enforces antitrust law, typically reviews sales much larger than that of Sauk County Health Care Centers. That leaves the Wisconsin Department of Health Services to decide its fate, Khan said. 

State officials consider a company’s financial stability and past performance in evaluating a change of ownership application.

The state health department has not received that application for the Sauk County facility, spokesperson Elizabeth Goodsitt said.

The department will have 60 days to approve or deny the sale once it does.  

The department blocked the sale of three SSM Health nonprofit nursing homes to New Jersey-based Complete Care last month, citing the for-profit company’s frequent federal citations. Complete Care operates four Wisconsin nursing homes. The U.S. Centers for Medicare and Medicaid Services gives one of those homes “below average” ratings. 

“We have submitted additional information that we believe will address their concerns and hope to receive a final decision soon,” a Complete Care spokesperson told WPR and Wisconsin Watch in an email. 

The Sauk County nursing home has an “average” Medicare rating under its public ownership. One of Aria’s homes has a “below average” rating. The other two are “much below average.” 

That doesn’t worry Sauk County Board Chair Tim McCumber.

“Aria is committed to taking harder cases, and while they would love to see those ratings improve, it doesn’t take much to knock them down,” he said in an interview.

Public nursing homes increasingly shifting to private ownership

David Grabowski, a professor of health care policy at Harvard Medical School, calls the “harder cases” line of defense a bit of an excuse. Everyone is entitled to quality care, he said in an interview, and research suggests residents of public nursing homes often fare better than folks in privately owned homes.

“Really the safety net in a lot of markets are those government-owned facilities,” Grabowski added.

But local governments have been gradually selling nursing homes to for-profit companies over the past 25 years, he said. 

Joice Meyer, who lived at Sauk County Health Care Center in 2020 while recovering from temporary leg paralysis, said the county can’t let that happen.

“Sauk County is going to take care of you, and they always have, and I’m sure that they’re going to keep it up as long as they’re allowed to,” Meyer told the gathering in Baraboo on Thursday. 

Staff called her by name, making her feel like more than just another room number.

“I still have nurses that I see that remember me,” Meyer said. “I don’t think you’re going to get that in another kind of nursing home.”