After the Pandemic Hit Nursing Homes Hard, California Lawmakers Push to Tighten Licensing Rules

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Source: Kaiser Health News, by Samantha Young

When Johanna Trenerry found a nursing home for her husband after his stroke, she expected his stay would be temporary.

He never came home.

Arthur Trenerry died at Windsor Redding Care Center in Northern California in October 2020. The 82-year-old great-grandfather is among more than 9,900 California nursing home residents who have died of covid-19.

The nursing home where Trenerry died is licensed by the state, but not under its current owner, Shlomo Rechnitz. The state denied Rechnitz a license, citing at least one death and multiple cases of “serious harm” at other nursing homes he owns or operates. To get around that, Rechnitz formed a business partnership with one of the home’s former owners, who continues to hold the facility’s license.

Some California lawmakers want to put an end to those types of business arrangements and ban people or entities from buying or operating nursing homes unless they have a license — which is the situation in most states. They’re also proposing an overhaul of the licensing process to reject applicants with poor performance and those without adequate experience or financial resources.

The ambitious effort, which the industry considers an overreach, could make California’s oversight the gold standard and a model for other states trying to improve nursing home care. Nationwide, more than 152,000 residents of nursing homes have died of covid during the pandemic, according to federal data.

“The public health emergency that we’ve experienced could be something that becomes a catalyst for making real change,” said Dr. Debra Saliba, a UCLA professor of medicine who served on a National Academies of Sciences, Engineering, and Medicine committee that released a comprehensive report on nursing homes in April. “One of the things that we have right now is the determination, the resources to make things happen.”

In his State of the Union address in March, President Joe Biden said the quality of care had declined in nursing homes taken over by investors — and vowed to set higher federal standards. In anticipation of the speech, the White House released a proposal calling on Congress to boost funding for nursing home inspections and to give federal regulators the authority to deny Medicare funds to underperforming facilities. The administration also directed the Centers for Medicare & Medicaid Services to propose minimum staffing standards within a year.

States are also taking steps to improve quality. New Jersey, for example, this year adopted a law that toughens penalties for health violations and requires nursing homes to disclose financial records.

In California, lawmakers are considering several proposals, including the changes to nursing home licensing rules.

Companies and individuals can buy or run nursing homes in California before they get a license, a process that even an industry lobbyist described at a legislative hearing this year as “backward” and unique to the state.

“In California, nursing home owners and operators can operate without a license even after they’ve been denied a license,” said state Assembly member Al Muratsuchi (D-Torrance), author of AB 1502. “Many of these owners and operators have, unfortunately, an extensive history of neglect and abuse.”

Muratsuchi’s bill would require an owner or company to apply for a license 120 days before buying or operating a nursing home and include financial records that contain the names of all owners and investors. The state would reject applicants who fail to meet standards for character, performance in other homes, and the financial ability to run the home. Homes operating without a license would lose Medicaid funding and couldn’t admit new residents.

The powerful California Association of Health Facilities, which represents more than 800 nursing homes, has blocked previous licensing legislation and has set its sights on Muratsuchi’s bill. The group is led by Craig Cornett, a veteran of the state Capitol who has worked for four Assembly speakers and two Senate leaders.

The organization has made just over $2 million in political contributions and spent $5.9 million lobbying lawmakers from Jan. 1, 2011, through March 31, 2022, according to records filed with the California secretary of state’s office.

The bill fails to consider the state’s “complex regulatory environments” and would create “extensive” disclosure requirements on ownership applications that “in many cases would fill an entire room with boxes and boxes of paper,” Jennifer Snyder, a lobbyist for the association, told lawmakers in January.

The measure would “eliminate the ability for most current owners in California to actually apply or even apply for a change of ownership,” she added.

But this year, the industry faces an altered political landscape.

Covid has pushed lawmakers to act — and Muratsuchi has gained a valuable co-sponsor for his bill, Democratic state Assembly member Jim Wood, head of the Assembly Health Committee. Wood has condemned nursing homes for not doing enough during the pandemic and has directed state regulators to conduct stricter oversight.

Muratsuchi’s measure has cleared the state Assembly and awaits a hearing in the Senate.

Investigations by news organizations CalMatters and LAist last year found that at least two California nursing home operators without licenses were running dozens of facilities even though officials at the state Department of Public Health had declared them unfit to do so.

The homes remain open, in large part because finding another nursing home for residents is incredibly difficult.

In July 2016, state regulators denied a license to Rechnitz — who had purchased the Windsor Redding Care Center, where Arthur Trenerry died — citing 265 health and safety code violations at his other facilities in the previous three years. Nevertheless, Rechnitz continues to operate the home in partnership with a former owner, Lee Samson, who is listed as a license holder in state records.

Mark Johnson, a lawyer who represents Rechnitz and his company, Brius Healthcare, said that Windsor Redding Care Center’s “license is in good standing” and that Rechnitz is managing the facility under an agreement “that is customary in the skilled nursing facility industry.” Rechnitz has filed a new and updated license application with the state, Johnson said.

Johanna Trenerry said she had no idea Rechnitz had been denied a license. Had she known, she said, she would never have placed her husband of 60 years at Windsor Redding.

Even before her husband caught covid, Trenerry and her children were trying to transfer him to another home because he seemed overly medicated, could no longer hold up his head, and fell numerous times trying to get out of bed, she said. Once, she recalled, the nursing home brought out the wrong person when the family visited.

They kept him “so drugged up,” said Nancy Hearden, one of the Trenerrys’ eight children. “And I think it was just because it was easier for them. He wasn’t getting to go to his rehab. I felt, ‘We’ve got to get him out of this place.’”

Then he got covid.

Sixty of the 84 residents at the facility came down with the disease in September 2020 — and at least two dozen of them died. According to a lawsuit filed by family members of 15 residents who died, including the Trenerrys, employees of the home were forced to work despite having covid symptoms. The lawsuit refers to state citations that found the home didn’t supply enough personal protective equipment to staffers, didn’t test staff, and placed covid patients and untested patients in the same rooms with residents who weren’t infected.

Johnson denied the allegations.

IRS Issues New Tax Deductibility Limits for Long-Term Care Insurance

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Source: Think Advisor

Traditional tax-qualified long-term care insurance policies now have new tax deductibility limits, according to the IRS.

Premiums for tax-qualified long-term care insurance policies are considered a medical expense, according to the American Association for Long-Term Care Insurance, and for an individual who itemizes tax deductions, medical expenses are deductible to the extent that they exceed the current amount required to meet the individual’s adjusted gross income (AGI).

Neither hybrid nor linked benefit (life plus LTC or annuity plus LTC) policies qualify for the deductions. However, individual taxpayers can treat premiums paid for tax-qualified long-term care insurance for themselves, their spouse or any tax dependents (such as parents) as a personal medical expense, according to AALTCI’s website.

The new 2019 limits for traditional LTC insurance premiums (that can be included as “medical care”) are as follows: If the policyholder’s attained age before the close of the taxable year is 40 or younger, $420 in premiums are deductible, unchanged from 2018. For policyholders 41 to 50, the limit is $790, versus $780 in 2018.

For those 51 to 60, the limit is $1,580, up from $1,560 in 2018, while for those 61 to 70, the limit is $4,220, up from $4,160. The largest deduction, for those more than 70 years old, is $5,270, up from $5,200.

Jesse Slome, executive director of AALTCI, points out in an email that older policyholders can benefit from the “potential of a $5,270 qualifying expense (deductible)” for a single person, or up to a $10,540 expense “for a couple where one spouse now has big medical/dental/vision bills.”

More information on LTCI and taxes is available from AALTCI’s website.

Commentary: Critical-illness insurance can protect savings

A critical-illness insurance policy can help “bridge the gap” in health coverage, writes Rod Rishel of AIG Consumer Insurance. Such policies offer a lump-sum payment that can help guard retirement savings and also provide continuity for small businesses, Rishel writes.

ThinkAdvisor (free registration) (3/28)

Commentary: Long-term care needs to be part of health care overhaul

Any effort to reform and replace the Affordable Care Act should include provisions to address long-term care, write Everette James, Walid Gellad and Meredith Hughes of the University of Pittsburgh. Efforts to enhance long-term care should include strategies that bolster the LTC insurance market and changes to how Medicaid and Medicare cover LTC, according to James, Gellad and Hughes.

Health Affairs Blog (3/16)

Long-Term Care Costs Climbing

A couple in their 60s both purchasing new long-term care insurance coverage can expect to pay between 6 and 9 percent more compared to a year ago, according to the annual industry analysis of prices.

“A typical couple where both spouses are age 60 will pay between $100 and $150 a month each for long-term care insurance protection,” said Jesse Slome, director of the American Association for Long-Term Care Insurance.  The national trade group just released its 2017 Long-Term Care Insurance Price Index, an annual examination of costs for new policies available.

Slome said good coverage provides benefits for up to 360 days with a benefit pool that increases each year as the policyholder ages. “For many individuals who ultimately need long-term care, this is going to be sufficient or good coverage, and it’s certainly going to be far more affordable.”

About 41 percent of current long-term care insurance claims end within one year, according to association data.

AHIP-commissioned study: Half of us will need LTC

People have a 50% chance of needing long-term care at some point, yet many underestimate the likelihood of needing such care, according to a new LifePlans study commissioned by AHIP, but insurance can provide protection. The study also found that of those who do need LTC, 30% will need the care for five years or more, and 3 in 5 people surveyed underestimate how much care in a skilled nursing facility costs in their community. AHIP blog (1/10)

California Has the Most LTCi Policyholders

In California, more than 600,000 are covered under a traditional long-term care insurance policy, according to the American Association for Long-Term Care Insurance. “This is certainly due to the size of California as well as the fact that the state has been very active in making residents aware of the importance of planning. While the California Partnership program has little relevance to consumers today, in former years it was valuable protection that I strongly advocated and which was actively marketed by insurance professionals,”   explains Jesse Slome, executive director of the American Association for Long-Term Care Insurance (AALTCI). Roughly seven million Americans have traditional long-term care insurance protection and another million have coverage under a linked-benefit or alternative product.

“A significant number of the inbound phone calls we handle and the online request for information come from Californians. Admittedly, there are fewer specialists today than there were a few short years ago, but there are still good avenues available for those who want to get information and compare their choices and options,” he said. For more information, visit or call 818-597-3227.

Why We Need a Government-Run LTC Program

by Laura Katz Olson
The U.S. is experiencing a rapid aging of our population, particularly among the eighty-five and over a sector that is most in need of long-term care (LTC). Low-income seniors requiring personal assistance in performing activities of daily living generally cannot afford costly private-sector services on their own, whether at home or in an institution. So they must rely on Medicaid, a demeaning needs-tested program that may force them into a nursing home. Middle class older people have to impoverish themselves to qualify for the program and they, too, frequently wind up in an institution unless the family steps in. People who depend on Medicaid generally do not have access to the better-quality facilities.

Abdication of collective responsibility for our frail elders also overly burdens their roughly 17.7 million family caregivers, mostly women, often leaving them emotionally, financially, and physically overwhelmed. They must contend with a confounding array of complex illnesses and multiple functional and cognitive disabling conditions, including Alzheimer’s disease and related dementias. In order to attain any government assistance, the aged and their families endure pointless paperwork and bureaucratic hurdles not encountered by participants in other social programs such as Social Security. I experienced this first-hand, nearly eight years ago, when I was suddenly thrust into a long-distance caregiving role for my mother and repeatedly faced intractable obstacles to attaining assistance for her. This was the beginning of my education as a consumer and not just a researcher of services for the aged. Geographic location determines the available amount, scope, and duration of publicly-supported services rather than actual need. My mother, who was entitled to only 10 hours of home care per week under Florida’s Medicaid program, surely could not have remained at home with such limited help given the extent of her disabilities. She might have fared slightly better in another state.

Private long-term care insurance is touted by certain political leaders as a solution. However, the evidence suggests that this is not a viable alternative for the vast majority of Americans. Premiums tend to be prohibitively expensive for moderate and low-income families, and have been skyrocketing for many individuals who already own policies. Plans typically pay far less than the actual cost of care, cap the number of benefit years, impose elimination periods (generally ninety days), and usually are not indexed to inflation. Collecting on contracts can be challenging as well since qualifying conditions for claiming benefits tend to be stringent. In addition, insurance companies tend to cherry-pick the healthiest clients, refusing to enroll anyone even at risk for disabling disorders.

In my estimation, in order to meet the current and future needs of care-dependent individuals, the U.S. must implement a mandatory, government-run LTC social insurance program. Similar to Medicare, everyone would contribute through a combination of general taxes, payroll taxes and annual premiums for recipients, based on income. Concomitantly, a universal single-payer system would de-stigmatize the receipt of benefits by advancing LTC as a social right; eliminate the pauperization of middle-class elders; remove income verification requirements; drastically reduce recertification and other burdensome procedures; save money through lower administrative costs, and offer economic security to seniors and their families. The plan would equalize access to benefits, irrespective of household income or where one resides. Older people not only would be eligible for the same services in each state, but they could also move to a new locale more easily and expeditiously. Certainly, this would be advantageous for chronically ill elders who want to be closer to their adult children and grandchildren. Moreover, in an all-embracing public program, the choice between entering a nursing home and obtaining care at home would be the same everywhere in the nation and the quality of services would no longer depend on one’s ability to pay.

In order to recruit enough competent, dedicated nurses and nursing aides, it would be necessary to pay adequate wages and benefits, provide advancement opportunities and improve the workplace environment. Many nursing homes are short-staffed and face high turnover. Studies consistently show that having high levels of direct-care workers is one of the most important factors in providing decent care.

Let me offer a few suggestions to further enhance the quality of care under my proposed government-run LTC social insurance program. The U.S. would benefit from a restructuring of the nursing home and home care delivery systems. For example, it is well-documented that for-profit nursing homes—especially publicly-traded chains—generally have a lower quality of care in terms of overall ratings, staffing, turnover, deficiencies, citations, and complaints. The growing trend toward private equity ownership of institutional facilities and home care agencies has greatly worsened the situation.

Long-term care is ill-suited for market strategies and the concomitant pressures of profit maximization. We should transform the financial underpinnings of LTC by moving from commercial to predominantly public and nonprofit providers, as occurs in most other economically advanced nations. Such a shift would not only eliminate the perverse incentives that prioritize financial gains over people, but could also foster a less costly and more humane means of serving our vulnerable citizens.

Barring such a radical transformation, at a minimum, it would be necessary for policymakers to break up the multi-facility nursing home chains; outlaw the takeover of long-term care services by private investment firms; and establish tougher regulations for the LTC industries and impose immediate and harsh penalties for violating them. The cost of prescription medicines must be controlled as well.

Some may argue that a government-supported LTC social insurance system would be too costly. However, the U.S. already spends considerable taxpayer dollars for such services, with clients mostly receiving substandard, sometimes harmful care for our money. In 2014, total Medicaid spending on LTC was $119 billion; Medicare contributed an additional $30 billion for post-acute services and rehabilitation. As these figures suggest, LTC is big business with much of the money flowing into the coffers of commercial nursing home and home care companies. Unless our public officials advance fundamental structural changes, the long-term care industries that have positioned themselves to feed at the public trough will continue to thrive at the expense of the chronically ill aged and their struggling paid and informal caregivers.

Laura Katz Olson has served as a Professor of Political Science at Lehigh University since 1974. She has published widely in the field of aging, health care and women’s studies, her articles addressing social welfare policy, especially the problems of older women and long-term care. To date, she has published nine books, mostly focusing on the care of the frail elderly. Olson has served on the American Political Science Council and is on the editorial board of the Journal of Aging Studies and the New Political Science Journal. In 2009, she received the Charles A. McCoy Lifetime Achievement Award and, in 2012, Lehigh University’s Williamson Award in Social Research for her book The Politics of Medicaid. Her most recent book, Elder Care Journey: a View from the Front Lines, relates her personal experiences as a caregiver for her mother.

Many Consumers Miss LTC Planning

A study by Lincoln Financial Groups finds that the majority of people who are 40 to 70 have not taken the necessary steps to prepare for a long-term care event. Only 45% of those with a financial advisor have discussed long-term care with their advisor, and few are aware of the wide range of solutions. Among those who have spoken with a financial advisor about long-term care, the most common resource discussed is long-term care insurance (82%). Retirement savings are the second most common resource (61%). Among the least discussed resources are hybrid products that combine long-term care benefits with a life insurance policy or annuity. Hybrid products are rapidly gaining traction in the market and outsell traditional long-term care insurance products, according to LIMRA. Only 28% of those surveyed own a financial product that can help address potential long-term care expenses. The top reasons for purchasing the product are to avoid depleting assets and for peace-of-mind, each cited by 92% of product owners followed by the desire to get the care one needs (86%).

Primary barriers for purchasing an LTC product are competing financial priorities and concerns over paying for something that may never be used – each reason cited by 57% of respondents. While some types of long-term care coverage products are use it or lose it, many hybrid products provide a benefit whether or not care is ever needed. Andrew Bucklee of Lincoln said, “As we head into Long-Term Care Awareness Month, its a perfect time for those who have not planned for potential care needs to begin conversations with their family and financial advisor. During these discussions, its critical that advisors help their clients identify their care preferences and other potential needs while ensuring they understand the differences among the many types of financial solutions available and the distinct advantages of each when building a tailored strategy that includes the right mix of solutions.” Respondents ranked these financial concerns in order:

  • Healthcare expenses (62%)
  • Retirement planning – having enough to live comfortably (59%)
  • Value of investments declining (58%)
  • Costs associated with nursing home or adult day care (54%)
  • The event of outliving their money (48%)

For more information, visit

IRS Increases Tax Deductions for Traditional Long Term Care Insurance


The IRS increased tax deductible limits for traditional long-term care insurance premiums paid in 2017. Jesse Slome, director of the American Association for Long-Term Care Insurance (AALTCI) said, “The tax deductibility of premiums…provides a real incentive for consumers, especially after retirement.” Only traditional long-term care insurance policies may be tax-deductible to an individual. Special tax advantages are not available for linked-benefit products, such as life insurance or annuity policies that provide a long-term care benefit. According to the AALTCI, in 2016 more people will purchase combo products than those who purchase traditional LTC insurance policies. IRS reports for 2014 reveal that nearly 5.1 million tax filers with incomes of $40,000 to $100,000 reported medical expenses that exceeded adjusted-gross income limits. Starting in 2017, all individuals can deduct qualified medical expenses that exceed 10% of adjusted gross income for the year. The limit is 7.5% of adjusted gross income for 2016, for individuals 65 and older. The IRS allows individuals to deduct medical expenses including preventative care, dental and vision care, prescription medications, glasses, contacts and hearing aids. Traditional long-term care insurance premiums can be included in the term “medical care.” “For retired seniors,…reduced income and increased medical costs means that the cost of traditional long-term care insurance can be all or mostly tax deductible. Many seniors have medical expenses that don’t meet the adjusted gross income limit. But they exceed the limit when the cost of long-term care insurance is included, which provides a significant tax deduction. This is a real benefit for the 23 million individuals age 65 or older who file federal tax returns,” said Slome. The following are the just announced 2017 limits:

Attained Age
Before Close of
Taxable Year               2017 Limit                  2016 Limit
40 or younger             $410 (+ 5.1%)             $390
40+ to 50                    $770                            $730
50+ to 60                    $1,530                         $1,460
60+ to 70                    $4,090                         $3,900
70+                             $5,110 (+4.9)               $4,870

Source: IRS Revenue Procedure 2016-55 (2017 limits) and 2015-53 (2016 limits)

For more information, visit or call the organization at 818-597-3227.

Last Updated 06/29/2022

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