A new report from the New Jersey Office of the State Comptroller has shed light on a troubling pattern that extends far beyond state lines: when nursing home owners prioritize profit over people, residents suffer.

According to the report, the owners of two South Jersey nursing homes diverted more than $90 million in Medicaid funding into companies they personally controlled while chronically understaffing the facilities. The result was predictable and devastating: residents left in their own waste, crying out in pain for hours without help; missed medications; preventable injuries; and, in one case, a resident who died after being fed the wrong type of food.

Although this investigation centers on New Jersey, the findings are part of a nationally documented crisis in for-profit long-term care. Regulators and advocates have repeatedly warned that complex corporate ownership structures, related-party transactions, and intentional understaffing allow nursing homes to appear compliant on paper while residents quietly endure neglect behind closed doors.

A System Driven by Staffing Cuts and Self-Dealing

The New Jersey report concluded that the nursing home owners funneled Medicaid dollars into shell companies, inflated “rent” and loan obligations, and concealed the movement of money, all while the facilities failed to meet even minimum staffing requirements on nearly every day reviewed.

This pattern echoes the findings of federal studies and investigative reporting nationwide:

• When owners siphon off Medicaid and Medicare funds instead of reinvesting in staffing, care quality collapses.
• Residents with high needs are left waiting for basic hygiene, mobility assistance, and pain management.
• Unlicensed or inexperienced staff are placed in roles they are not equipped to perform.
• Facilities rack up repeated citations while ownership continues to profit.

The NJ Comptroller called the findings “the tip of the iceberg,” pointing to a wider industry problem rather than an isolated scandal.

What This Means for Families in Maryland

While the facilities in this report are out of state, the underlying issues are ones we see frequently in Maryland cases:

• Chronic understaffing, especially on nights and weekends
• Residents left in dangerous conditions due to lack of supervision
• Corporate owners using layers of LLCs and related entities to obscure where money goes
• Facilities prioritizing cost-cutting over safe resident-to-staff ratios
• Repeated harm that could have been prevented with adequate staffing and oversight

The New Jersey report is a reminder that nursing home neglect is rarely the result of individual caregivers failing. It is the result of ownership decisions that reduce staffing to unsafe levels and divert funds meant for resident care.

Accountability for Profit-Driven Neglect

The Comptroller is seeking $123.9 million from the owners and related businesses and has referred the matter for further action. But accountability is usually slow, and for many families, help comes only after serious harm has already occurred.

That is why civil cases brought by families, not regulators, remain one of the most powerful tools for uncovering misconduct, forcing transparency, and improving safety.

Brown & Barron, LLC’s Work Protecting Nursing Home Residents

At Brown & Barron, LLC, we have taken on cases involving severe understaffing, preventable injuries, malnutrition, medical mismanagement, and corporate owners who hide behind complex business structures while residents suffer.

Our attorneys work to expose:

• Hidden financial relationships between owners and “related companies,”
• Chronic staffing shortages that violate care standards, and
• Systemic failures that place residents at risk of neglect, abuse, and wrongful death.

These investigations often reveal the same patterns described in the New Jersey report — patterns that have harmed countless families right here in Maryland.

If you suspect a loved one was neglected or harmed in a nursing home or assisted living facility, our team can help you understand what happened and hold the responsible parties accountable. Call (410) 698-1717 or contact us online to request a consultation.