Wednesday, October 24, 2007

Carlyle to Turn Manor Care into 550 Little Pockets

Poorly treated patients in Manor Care's nursing homes will no longer have a deep pocket to sue once The Carlyle Group takes over the firm. News reports indicate the reorganized company will be a series of individual corporations, one per facility. They also plan to separate operations from real estate, further protecting their capital assets. The private equity firm's attorneys must really want to protect Carlyle's $75 billion in investments given their actions.

Manor Care won't be Carlyle's first health care purchase. They closed on LifeCare Hospitals last August, just weeks before Hurricane Katrina's landfall. After 24 patient deaths in the New Orleans LifeCare unit, Carlyle's attorneys argue the feds are responsible! Patients became "wards of the federal government"as soon as FEMA evacuation teams set up in New Orleans.

Funny, health care giant HCA chartered helicopters to remove patients from their dead facilities. It seems the crackerjack management team on Pennsylvania Avenue didn't know how or didn't want to spend the money. In no case, have I ever seen a hospital disaster plan state the organization's obligation to care for patients ends when FEMA teams arrive in the general area. Then again I haven't seen health care facilities with multiple sites splinter into many corporations to minimize patient liability exposure. I'm used to providing excellent care to avoid lawsuits, not unleashing an army of attorneys and issuing lofty but meaningless pledges...