NBER Study Reveals Private Equity Nursing Home Ownership Increases Mortality 10%, Causes 20,000 Excess Deaths

National Bureau of Economic Research releases landmark study (Working Paper 28474) analyzing patient-level Medicare data from 18,000 nursing facilities over 17 years, finding that private equity ownership increases patient mortality by 10% compared to other nursing homes. The 10% mortality increase translates to more than 20,000 additional deaths during the study period, averaging over 1,000 excess deaths annually. After instrumenting for patient-nursing home matching, researchers calculate a local average treatment effect on mortality of 11%. The study reveals the profit extraction mechanisms: PE-owned facilities cut frontline nursing staff hours by 3%, reduce total staffing by 1.4%, yet increase antipsychotic drug prescriptions by 50%. By sedating patients rather than providing behavioral therapy and adequate staffing, PE-owned nursing homes reduce labor costs while increasing mortality. The research shows PE ownership leads to lower-risk patients entering facilities yet higher death rates, demonstrating that profit maximization directly causes preventable deaths. COVID-19 data reinforces findings: PE-owned nursing homes had infection rates 30% higher and death rates 40% higher than state averages. Additional impacts include decreased patient well-being, reduced compliance with care standards, and increased taxpayer spending per resident by 11% despite worse outcomes. The study exposes how PE firms acquire nursing homes through leveraged buyouts, load facilities with debt, extract management fees, cut essential staffing, chemically restrain residents to reduce costs, then leave when facilities collapse under debt burden. This represents systematic profit extraction that kills vulnerable elderly Americans while enriching PE investors. The research demonstrates that no study has found PE ownership improves healthcare quality, efficiency, costs, or access, only wealth extraction at the expense of patient lives.