On Friday, March 20, the New Jersey Department of Health got an urgent call from a Catholic nursing home. COVID-19 was tearing through St. Joseph’s Senior Home in Woodbridge Township. At least a dozen of the nuns who worked at the facility had fallen ill, and they feared they didn’t have enough staff on hand to care for the residents.
Instead of sending in state inspectors to assess the situation, health officials reached out to private care providers for help, and CareOne, one of the largest nursing home chains in New Jersey, said it would assist. When nurses from the company arrived at St. Joseph’s on Sunday afternoon, they found just three nuns trying to manage almost 90 residents. The company sent a report to the state on Monday, and the following day, state officials took the extraordinary step of ordering St. Joseph’s to evacuate.
The state determined that CareOne, with its network of homes across the state, had the resources to accommodate the influx of transfers. The company quickly began to make space in its 94-bed Hanover facility, CareOne at Hanover. In a span of hours, about 70 residents at Hanover were hustled out, their belongings moved in trash bags, and taken to three other CareOne facilities in the area.
By Wednesday morning, residents from St. Joseph’s were arriving in a caravan of ambulance buses. They were frail and, in some cases, gravely ill.
It was a frantic effort, undertaken as infections in New Jersey were starting to surge. The first that local officials in Hanover heard of the evacuation was from township residents calling the police about the line of ambulances outside the facility.
In the weeks that followed, CareOne would go on to have the highest rate of COVID-19-related deaths among large long-term care companies in New Jersey. At least 518 residents of the company’s New Jersey facilities have died from the novel coronavirus.
Of the 363 nursing homes in New Jersey, two of the three CareOne facilities that received transfers from Hanover — facilities in Morristown and Parsippany — have had among the highest death rates. At the Morristown facility, where 45 residents died, there has been one death for every four beds in the facility. At the Parsippany home, there were 36 deaths, nearly one for every three beds. Infections at CareOne’s Morristown facility went on to raise alarms with the local Health Department, and the Parsippany home was cited for infection-control issues.
Melissa O’Connor, an expert in nursing care for the elderly, said that with testing as scarce as it was early in the pandemic, the moves between CareOne facilities may have helped spread the virus.
“They exposed all of those people they moved unnecessarily,” said O’Connor, an associate professor at Villanova University’s M. Louise Fitzpatrick College of Nursing in Pennsylvania. “They probably made an assumption that they had no positive cases in those other two places, but that was a really huge, and wrong, assumption.”
By then, CareOne had become a key player in the state’s response to COVID-19. Not only had it been enlisted to deal with the crisis at St. Joseph’s, but soon after, it was given a license agreement to provide more than 700 hundred beds at five of its facilities to care for COVID-19 patients being discharged from hospitals.
As the pandemic continued to ravage the state in early April, cases exploded in nursing homes, which had been given less attention and fewer resources than hospitals in the early weeks of the outbreak. New Jersey would record nearly 6,800 deaths linked to long-term care facilities, more than any other state has reported, including 81 residents at a veteran’s home in the town of Paramus and 63 at a nursing facility in rural Andover.
The toll on CareOne and its 21 nursing homes in New Jersey is particularly striking given the crucial role the state gave the company in helping manage the crisis. The death rate at the company’s New Jersey homes is more than 60% higher than the rate for all homes statewide, a ProPublica analysis found.
Eric Bloom, a spokesman for the company, said in an email that the high death rates at CareOne facilities found in ProPublica’s analysis are misleading because the company took in and treated a large number of COVID-19 patients. But according to the New Jersey Department of Health, the data does not count patients who are already COVID-19-positive when admitted to a facility toward that facility’s case and death totals; thus, those patients would not have inflated death rates for facilities in the analysis.
In an emailed response to questions, New Jersey Department of Health spokeswoman Donna Leusner said that CareOne received the license agreement because “it had facilities statewide” and the staff, protective equipment and capacity to separate infected residents from uninfected ones that was “necessary to provide beds for COVID-positive patients in this pandemic crisis.”
Once the original residents of Hanover were moved to other facilities, 78 residents from St. Joseph’s were moved in. Their arrival prompted worried calls to the local Health Department, which struggled to allay concerns with what limited information it had.
Carlos Perez Jr., the health officer for Morris County, where Hanover is located, heard from CareOne staff that the new residents were “filthy, unkempt, completely unwell.” He said a CareOne nurse broke down crying, describing the situation over the phone.
“They just moved them and that was it,” Perez said. “I was offered no assistance at all.”
Several families of residents transferred from St. Joseph’s and CareOne at Hanover said they were kept in the dark while the evacuation was taking place. Marilyn Minsk said she only received a call from CareOne after her 98-year-old mother had been moved from Hanover to another of the company’s homes.
“I said: ‘No, I didn’t want her moved. What are you talking about?’ And then the phone was hung up. I didn’t know where she was,” Minsk said. “I was in shock. We’re all locked down. We can’t even move. How can you take her out of a place when I can’t even see her?”
Minsk would learn that her mother, Sylvia Sternhell, had been moved to the facility at Parsippany and her belongings had been thrown into trash bags and stored in the basement at CareOne at Hanover. Within 10 days of the move, Sternhell developed a respiratory illness and was later diagnosed with COVID-19. Over the next month, she was moved back and forth between the hospital and the nursing home. She died on May 13.
CareOne did not address questions from ProPublica about Minsk’s dealings with the company. “The actions taken by CareOne staff saved lives and were applauded by state officials, including Governor Murphy,” Bloom wrote. “We are proud of our people and any attempt to by [sic] the media to attack them is misguided.”
Minsk remains heartsick not only because she couldn’t see her mother in person during her last months, but also because she’s convinced CareOne took on more residents than it could safely handle.
“They were not heroes,” Minsk said. “Very far from being heroes at all.”
To understand which nursing homes bore the brunt of COVID-19’s spread through New Jersey, ProPublica used state long-term care outbreak reports and data from the Centers for Medicare and Medicaid Services on the number of licensed beds per facility to calculate death and infection rates for each home. Read more about our analysis here.
CareOne homes stood out, with a death rate equal to 17% of its certified beds, compared with the 10% death rate statewide. The chain’s homes also had an infection rate of 56% compared with 38% statewide.
The pandemic hit some counties harder than others, but in seven of the nine counties where CareOne operates, its homes had higher death rates. In Morris County, where the Hanover, Morristown and Parsippany homes are located, the chain’s death rate was 21% compared with 10% for the rest of the county. In Bergen County, which recorded the most deaths of any county in the state, the company’s death rate was 16% compared with 14% countywide; in Burlington County, the chain’s rate was 19% compared with 8% for the rest of the county.
ProPublica’s analysis excludes assisted living facilities, which are not regulated by CMS. Rates are as of July 10, after which the state changed its reporting practices, making tracking cumulative deaths by facility impossible.
Bloom, the CareOne spokesman, said the state data used in the analysis is “imperfect” because it flows from local health departments that interpret the reporting guidelines differently. CareOne also contends that ProPublica’s method for calculating infection and death rates is inaccurate because it uses facilities’ licensed bed capacity rather than actual numbers of patients treated. Bloom said the analysis didn’t reflect CareOne’s higher patient turnover.
“CareOne operates post-acute care centers that focus on medically complex short-stay cases — not traditional long-term care nursing homes,” he said.
It’s true that CareOne homes, like many nursing facilities, offer short-term care, but 20 of its 21 homes in New Jersey are rated by CMS for providing long-term care as well. The most recent publicly available data for admissions across all nursing facilities is from 2017, and the three largest chains in New Jersey, including CareOne, declined to share current admission numbers with ProPublica.
Using the number of licensed beds to control for population size is common in analyses of nursing homes, including in a report commissioned by New Jersey and produced by expert consulting group Manatt Health on the impacts of COVID-19 in long-term care facilities.
The number of short-term patients flowing into nursing homes during the pandemic almost certainly declined from previous years: elective surgeries, a major source of short-term stays in nursing homes, were suspended in New Jersey for most of April and May, when the pandemic was at its peak. During the spring, the main source of short-term stays was likely patients recovering from COVID-19 who were discharged from hospitals to nursing homes, including many operated by CareOne.
Founded in 1999 by entrepreneur Daniel Straus, CareOne operates some 55 facilities in six states. The largest share of its business is in New Jersey, where it runs 31 nursing homes and assisted living facilities. It also operates facilities in Massachusetts, Virginia, Pennsylvania, Maryland and Connecticut.
Before starting CareOne, Straus, 63, and his brother built a national chain of long-term care facilities that they sold for $1 billion. Straus lives in Englewood, a few miles from CareOne’s headquarters in Fort Lee.
Over the past 20 years, CareOne has cultivated an image as a family business that puts its residents first. Court records show it is also one that’s hard-nosed in responding to criticism of its care and business practices.
Amid ongoing legal battles in 2016, CareOne sought the help of Michael Cohen, the New York lawyer who worked for many years as a fixer for President Donald Trump.
Cohen, who went to prison in connection with some of his work for Trump, hired an IT company, RedFinch Solutions, to set up websites filled with positive stories about Straus to help offset unflattering Google search results, according to RedFinch’s CEO, John Gauger. (Without naming Straus or the company, court documents say that Cohen was paid $200,000 in 2016 for “consulting.”)
After the company was faulted by the National Labor Relations Board for its dealings with workers and the Service Employees International Union in New Jersey and Connecticut, the company went after the union with a law often used against the Mafia. In 2012, it filed a Racketeer Influenced and Corrupt Organizations, or RICO, lawsuit against the union’s affiliates in New Jersey and Connecticut.
The suit accused organizers of “criminal sabotage, intimidation and other acts of extortion.” A federal judge in New Jersey ruled in favor of SEIU in October 2019, saying its organizing efforts constituted “lawful, albeit aggressive, bargaining.” CareOne has appealed.
Late last year, a jury found the company at fault to the tune of over $6 million in a racial discrimination lawsuit brought by a Black woman who had been promoted to vice president. Soon after she was given the new position, she claimed in court documents, she was told by a superior: “I don’t want a black person walking around here in a suit as a VP. I want you in scrubs, flats, and a lab coat.” The woman was fired the next day.
The company says the woman was terminated for poor performance and filed a motion to dismiss the damages, which a judge denied in January. “This verdict was unfounded and represents a run-away jury,” Bloom said. CareOne says it is appealing.
CareOne has faced a number of lawsuits in recent years in which residents or their families have claimed CareOne facilities aren’t meeting care standards for nursing homes. It’s not uncommon for homes to face such suits, but in several, CareOne has taken an unusual position in response: It has argued that, when it comes to short-term residents, it isn’t obligated to meet standards for nursing facilities.
“Safe and decent living environment?” Katelyn Cutinello, CareOne’s attorney, asked during a hearing last month in one such lawsuit. “He never intended to live at CareOne. He was admitted for subacute rehab to be discharged home.” (The judge denied the company’s motion to dismiss the plaintiff’s claim three weeks later.)
Deborah Gough, the resident’s lawyer, said she’d seen CareOne use this defense before and called it particularly troubling right now since most of the COVID-19 patients the chain has admitted from hospitals would be considered short-term residents.
CareOne did not respond to questions about its use of this legal argument.
One case taken to trial last year by a law firm in Cherry Hill, New Jersey, dealt with a 57-year-old recovering cancer patient who suffered a bedsore that went to the bone and severe catheter injury to his penis under CareOne’s watch. In that case, CareOne claimed that its facility in Evesham Township wasn’t required to meet standards for nursing homes in caring for the man. (The Evesham facility is one of the five that took COVID-19 patients from hospitals under CareOne’s agreement with the state.)
“They try to say that the rehab resident, since they are just there for the short-term rehabilitation, is not subject to the nursing home laws,” said Richard Talbot, the lead lawyer on the case. “It’s beyond disingenuous to even make that argument.”
The jury agreed, and last year the executor of the man’s estate, his brother, was awarded over $400,000 including attorney’s fees and other costs.
New Jersey’s COVID-19 crisis gave CareOne an opportunity to work closely with state officials and burnish its reputation.
When it was called upon to help with the emergency at St. Joseph’s, the governor singled out the company and Executive Vice President Elizabeth Straus, daughter of Daniel, for public praise. At a March 24 press conference, Gov. Phil Murphy gave a “shoutout in particular to CareOne,” he said. “I spoke to Lizzy Straus yesterday, who’s terrific, and CareOne in particular with this challenge.”
The state also looked to CareOne and other large long-term care providers when it appeared a surge in COVID-19 patients might cause a bed shortage at New Jersey hospitals. It made agreements with three large chains to provide dedicated COVID-19 care at their facilities. The New Jersey chain Alaris Health had three homes licensed, providing around 300 beds. National nursing home operator Genesis HealthCare agreed to provide more than 100 beds at two facilities. The first, and biggest, deal went to CareOne, for 707 “COVID-capable” beds at five facilities, on March 30.
Then, on March 31, New Jersey issued an order compelling all long-term care facilities to accept stable COVID-19 patients discharged from hospitals. Homes could not turn away patients because they tested positive for the virus and could not require a person to be tested before being admitted.
While the wisdom of moving COVID-19 patients into communities full of vulnerable elderly people spurred instant debate, the financial incentives for homes were substantial: Facilities could fill beds left empty by the pause on elective surgeries and, in some cases, have their bills covered by Medicare, which pays more, instead of Medicaid. Beyond per-patient payments, the homes with licenses from the state could also be eligible for reimbursement of all reasonable costs through the Federal Emergency Management Agency or through emergency compensation boards appointed by Murphy.
“This is very lucrative for the nursing home,” said David Grabowski, a professor of health policy at Harvard University who specializes in long-term care. “They make double-digit margins for this type of care. It’s exactly the care from a financial perspective that they would like to be doing.”
CareOne was among the most aggressive in opening its doors to COVID-19 transfers and swiftly moved to use its agreement with the state to bolster its corporate branding. On April 1, it filed an application with the United States Patent and Trademark Office to register the COVID-Capable service mark and now uses it prominently in its marketing.
Not all the transfers went well, however.
Dorothy and Edward McBride, a married couple in their 80s, were discharged to CareOne at Livingston after testing positive for COVID-19 at their assisted living facility, where they’d been for almost a year, and going to the hospital for a day.
Their daughter, Linda, who requested that her last name not be published, says her parents complained they were neglected at the home, their calls for assistance going unanswered for hours. Aides were sometimes unavailable to help her father with meals, so his elderly wife would try to shift the 6-foot-2, 200-pound man into an upright position so that he could eat.
Edward McBride died six days after he was admitted. The only call Linda received was at 1:10 a.m. on Easter Sunday to let her know he had passed. Linda, who is a nurse, said, “I know I would never ever treat my patients, or my patients’ family, the way my parents were treated.”
CareOne did not address questions about the McBrides’ treatment in CareOne at Livingston.
Less than two weeks after issuing the directive to nursing homes, New Jersey pulled back. On April 13 the state Health Department established strict criteria for a facility to accept COVID-19 patients.
By then, CareOne was preparing to return the residents it had taken in from St. Joseph’s — 78 evacuees plus four additional people who had been in the hospital during the evacuation. Fifty-one were moved back starting on April 16, Dawn Thomas, a spokeswoman for the state Health Department, said in an email responding to ProPublica questions.
It’s unclear what happened to the other 31. The Health Department wouldn’t say how many St. Joseph’s residents died while with CareOne. St. Joseph’s did not respond to several calls and an email seeking comment.
CareOne defended its care of the St. Joseph’s residents. “After CareOne’s heroic measures at St. Joseph’s and a review of the extensive protocols and procedure [sic] derived from that experience, the state designated some of our facilities COVID-capable,” it said in a written response to questions from ProPublica.
The company’s role in the March evacuation of St. Joseph’s, in which it both assessed another nursing home and then took in its residents, remains troubling to some local officials and nursing home experts.
“It’s hard to imagine any circumstance where the entity doing the evaluation should also be the one profiting off of the outcome of that evaluation when peoples’ lives are at stake,” said Richard Mollot, executive director of the Long Term Care Community Coalition, a national nonprofit focused on improving practices at nursing homes and assisted living facilities.
After the transfers from CareOne at Hanover that were spurred by the St. Joseph’s situation, Morristown health officials became increasingly concerned about how CareOne at Madison Avenue, the company’s facility in Morristown, was managing COVID-19.
When a health official in Morristown directed the company in April to suspend admissions, he was rebuffed by the company, emails obtained by ProPublica show.
The facility’s administrator said that the nursing home’s procedures complied with state standards, and that nursing homes were not subject to regulation by local health departments.
Morristown health officials then emailed the state for assistance. Ten days passed without reply. But while they were waiting, the state issued a directive on April 22 to local health officials to take the lead on outbreak investigations in long-term care facilities.
The township officials wrote to the state again about CareOne at Madison Avenue. They said that based on data from the facility, 38 residents had died from COVID-19 as of April 27, and 43 staff members had fallen ill, but the facility was continuing to admit people and was not addressing concerns from local health officials.
The state promised to investigate, but a few days later, Morristown officials were told the state had conducted an inspection of the facility and deemed it in compliance. The Morristown officials were left uncertain about the scope and depth of the state’s review and say the state has refused multiple requests for more details.
In May, spurred by the burgeoning death toll from COVID-19 at New Jersey nursing homes, the state commissioned an independent assessment of the facilities and their regulatory overseers.
The report by experts with the consulting group Manatt Health released in June found that nursing homes were underprepared for the pandemic’s wave of infection, and that the state’s oversight infrastructure, inadequate even before the crisis, couldn’t keep up.
“Under-resourced state agencies did not have sufficient staff to deploy to facilities and conduct meaningful oversight prior to COVID-19,” the report read. “COVID-19 didn’t create the problem–it exacerbated the long-standing, underlying systemic issues affecting nursing home care in New Jersey.”
The state’s order to compel nursing homes to take COVID-19 patients from hospitals, and CareOne’s central role in taking them, has left some families bitter.
Carmela Minor’s father, Joseph Ferrante, 92, was a resident at CareOne’s King James nursing home in a small town on the Jersey Shore when she received a letter from the facility saying it was accepting COVID-19 patients.
“By order of the Commissioner of Health, all facilities, including ours, must accept as new residents those who are being discharged from the hospital who have tested positive for COVID-19,” the April 14 letter read.
Minor says she wishes she had pulled her father out as soon as she learned that.
By May 1, her father had developed a 103-degree fever. Minor had him admitted to a nearby hospital, but 11 days later, he was dead from the virus.
CareOne at King James first appeared in the state’s COVID-19 outbreak report with eight cases on May 4, three weeks after Minor received the facility’s letter. Two days later, there were 30 confirmed COVID cases. By the time her father died, there were over 100 cases and eight dead residents. By July 13 — just before the state stopped publishing key data on outbreaks at long-term care facilities, making it harder to see their full toll — there were 140 cases, involving staff and residents, and at least 19 residents had died.
CareOne did not respond to ProPublica’s questions about the outbreak in the King James facility.
Minor tries not to blame herself for what happened to her father, but mostly, she wishes CareOne had handled COVID-19 differently.
“To not be careful with this virus, and to accept people into the facility that you know have it, doesn’t make sense.”
Do you have access to information about New Jersey’s public health or response to the COVID-19 pandemic that should be public? Email Sean Campbell at sean.camp[email protected] or contact him on Signal at 352-448-5247. Here’s how to send tips and documents to ProPublica securely.
Caroline Chen contributed reporting.