Chicago Medical Malpractice Lawyer Blog

In Chicago and throughout Illinois it is necessary to identify the correct corporate structure when bringing suit against a nursing home. A recent article in Trial Magazine is helpful on this subject:

After several major chains were hit with Medicare fraud investigations or were forced to file for bankruptcy protection, the business model began to change. Virtually all of these national chains have undergone extremely complex business transactions in which they were sold, merged, or parceled out into different entities—or otherwise drastically changed.

Here are some sources of information that will help identify the correct entity:

* state Medicaid cost reports/home office reports and federal Medicare contracts
* the secretary of state’s Web site and uniform business reports that include names of LLC members or corporate officers/directors
* state licensee files, including applications to the state, change-of-ownership documents, and other related documentation
* for a publicly traded corporation, Securities and Exchange Commission filings and reports, 10ks or annual reports, statements of corporate officers, and stock values
* the facility’s admission packet, brochures, pamphlets, and other promotional literature
* Google searches on the nursing home facility and the entities that own or manage it (Searching all the names that appear in the Medicaid cost reports is a great starting point.)
* copies of court files, especially depositions, from other cases involving the facility you are investigating, as well as other facilities owned or managed by the same entities
* conversations with other attorneys who have previously brought claims against the facility
* conversations with former employees of the facility (if your state allows)
* the local property appraiser’s office or Web site regarding the facility site

* copies of the master lease and any subleases
* copies of all management agreements, ancillary service contracts, and financial services agreements between the facility and all related entities
* all the facility’s budget information, including the annual budget, monthly reports, budget variance requests, per-patient-day (PPD) data, and the staffing budget
* the governing body documentation and information (According to 42 C.F.R. §483.75(d) (2006), all facilities must have a governing body to establish and implement policies and appoint the administrator.)
* copies of bank documentation, promissory notes, loan applications, guarantees, and any other documents that relate to the capital that was borrowed—to set up the facility and its sister facilities—as part of the entire operation’s management
* all e-mails between any and all staff in the facility and any outside entity or person

Now, it is difficult, if not impossible, to identify the entity that owns, operates, and controls any skilled nursing facility. A nursing home and its literature no longer bear the name of its owner and operator. The business model is focused on shielding the true corporate owners from liability or responsibility for their residents’ injuries.