Nursing homes: States can set conditions on sales to private equity

The document analyzes the Rhode Island Department of Health's approval of an $85 million sale of 10 nursing homes to Tryko Partners and Kadima Healthcare. It highlights the use of 'standard conditions' regarding debt-to-equity ratios and the implementation of a five-year quality maintenance requirement to protect residents from the extractive business models of private equity. The author argues that while Rhode Island's quality measures are a positive step, the state's financing limits are too lenient, allowing debt levels that may divert funds from clinical care.

• In late 2022, the Rhode Island Department of Health approved the $85 million sale of 10 nursing homes from Health Concepts to private equity firm Tryko Partners and operator Kadima Healthcare.
• The acquisition utilized a corporate structure that separated real estate assets from facility operations into distinct entities.
• Both Tryko Partners and Kadima Healthcare had documented histories of quality and safety issues at other facilities they owned prior to the Rhode Island acquisition.
• Rhode Island applied 'standard conditions' to the financing of the purchase, requiring a minimum equity contribution of 20% and a maximum debt of 80% for each site.
• The document argues that Rhode Island's 80% debt limit is insufficient because it allows for higher debt levels than the private equity industry average, which typically uses 70% debt and 30% equity.
• To protect residents, the state imposed a condition requiring the new owners to maintain CMS quality ratings for five years; if a rating drops by two stars, an independent monitor must be hired at the owner's expense.

APA

Private Equity Stakeholder Project (2023). Nursing homes: States can set conditions on sales to private equity. https://pestakeholder.org/news/nursing-homes-states-can-set-conditions-on-sales-to-private-equity/

Chicago

Private Equity Stakeholder Project. Nursing homes: States can set conditions on sales to private equity. 2023. https://pestakeholder.org/news/nursing-homes-states-can-set-conditions-on-sales-to-private-equity/.

Wikipedia

{{cite report |author=Private Equity Stakeholder Project |title=Nursing homes: States can set conditions on sales to private equity |date=20 March 2023 |url=https://pestakeholder.org/news/nursing-homes-states-can-set-conditions-on-sales-to-private-equity/ |access-date=23 October 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{privateequitystakeholderproject2023nursing, author = {{Private Equity Stakeholder Project}}, title = {{Nursing homes: States can set conditions on sales to private equity}}, institution = {Private Equity Stakeholder Project}, year = {2023}, month = mar, url = {https://pestakeholder.org/news/nursing-homes-states-can-set-conditions-on-sales-to-private-equity/}, urldate = {2026-10-23}, note = {Indexed by Climate Insights Directory} }