The State Found Red Flags in Nursing Homes But Licensed Them Anyway. 4 Things to Know

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The chain of California nursing homes owned by Shlomo Rechnitz and his companies has faced state scrutiny for years. Now, a series of recent lawsuits is bringing renewed attention to his companies.

Elder care advocates say Rechnitz’ companies are Exhibit A in how regulators at the Department of Public Health are failing some of California’s most vulnerable citizens.

In 2021, a CalMatters investigation documented that the state Department of Public Health allowed Rechnitz and his companies to operate 18 nursing homes while delaying a decision on granting licenses to them.

The state had kept the license applications in a “pending” status for seven years after he acquired them. Rechnitz and his companies were allowed to continue operating five additional homes even after the state denied licenses to them.

Gov. Gavin Newsom signed a law meant to address the issue, but state regulators in 2023 granted Rechnitz’ companies the licenses to operate the homes just before the measure took effect.

Here are key takeaways from CalMatters’ most recent coverage:

Newly licensed homes now subjects of patient lawsuits

Several homes that received licenses in 2023 are now being sued by patients and their family members.

In February 2024, a Los Angeles County jury awarded $2.34 million to an 84-year-old nursing home resident named Betsy Jentz, finding that Country Villa Wilshire had violated her rights on 132 occasions, at times leading to serious injuries.

This coming February, a jury in Shasta County is scheduled to hear a case against Windsor Redding, which is accused of negligence in the 2020 COVID-19 deaths of 24 patients.

Another upcoming case involves 78-year-old Barbara Pendley, who allegedly died after suffering severe dehydration at North Point Healthcare & Wellness Centre in Fresno.

And trial is scheduled to begin next spring in the case of a 79-year-old dementia patient, referred to as Cheryl Doe, who was allegedly raped twice at Windsor Healthcare Center of Oakland; a second case against the same facility alleges that excessive sedation of 64-year-old Alando Williams led to his death.

Rechnitz and his companies have denied allegations in all of these cases.

“It is accurate that nursing homes are the target of abusive lawsuits that accomplish nothing but depleting resources for patient care,” said Mark Johnson, an attorney for the facilities and their holding company, Brius.

On average, more citations at Rechnitz homes

A CalMatters analysis of data from both the state health department and the federal Centers for Medicare & Medicaid Services found 78 California facilities in which Shlomo Rechnitz or his wife, Tamar, were listed among the owners. On average the facilities fared poorly on several key quality metrics compared to the state overall.

• In the past three years, these 78 nursing homes received an average of 12.4 citations for facility-reported incidents, compared with 6.1 for all nursing homes statewide.
• A higher proportion of the facilities has received a federal fine in the last three years than the state’s overall rate. Two-thirds of these facilities received at least one federal fine in the last three years, compared to half of all facilities across the state.
• The facilities have been fined an average of $47,897 during the last three years, compared to an average of $29,573 for all California facilities.

Johnson, the attorney for Rechnitz’ facilities, said in his email that a large percentage of these facilities are located in Los Angeles County, which issues deficiencies at a higher rate than any county in California, many of which are overturned on appeal.

He also said that “Mr. Rechnitz’s facilities self-report at a significantly higher rate than other comparable facilities,” which, in turn, could lead them to have a higher number of deficiencies.

Rechnitz is wealthy

In August 2024, an Alameda County jury found that Alameda Healthcare & Wellness had violated the rights of  71-year-old James Doherty, Sr. more than 1,400 times.

That included seven instances in which staff failed to transport him, causing him to miss chemotherapy treatments, court documents said. Doherty died following the development of a large pressure sore. His family was awarded $7.6 million.

Another key revelation from that case: Rechnitz and his wife disclosed their net worth. According to financial documents filed in court, it comes to $786 million.

Tony Chicotel, a senior staff attorney for California Advocates for Nursing Home Reform, said that dollar figure hasn’t been divulged publicly before.

“At least in some of these chains, the money that was meant to go for patient care is being stripped away and sent up top to the ownership,” he said.

Advocates say the state is not doing its job

Elder care advocates say the state Department of Public Health could push for greater accountability, including withholding licenses from owners they deem to be bad actors.

Wendy York, a Sacramento attorney specializing in nursing home abuse, said that watching elderly and disabled residents repeatedly suffer the same types of injuries in these facilities “feels like a broken record. It feels like Groundhog Day.”

There are “government agencies who are responsible for their oversight,” York said, but “at the end of the day, it feels like we’re the ones who are doing the enforcement.”

Department of Public Health spokesman Mark Smith said in an emailed statement that the department “remains committed to transparency and accountability for all providers, and to the health and safety of all nursing home residents in California.”

This article was originally published on CalMatters and was republished under the Creative Commons Attribution-NonCommercial-NoDerivatives license.