December 2, 2020

How government incentives shaped the nursing home business — and left it vulnerable to a pandemic

For the family of Mary Catlin, who died after catching the coronavirus at a nursing home, the pandemic was an infuriating and avoidable tragedy. But for the owners of the Michigan nursing home, as hard-pressed as they were to avoid catastrophe, the infection also presented an opportunity.

On April 18, three days after Catlin died, Michigan created a series of “hub” nursing homes with wings or floors dedicated to covid-19, the disease caused by the coronavirus. The state would provide $5,000 per bed up front to each facility to help get ready, and promised an extra $200 a day for each patient. It was a powerful incentive, doubling the usual Medicaid payment.

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