GRANNY HEALTH CARE GRIPES
Carlyle’s nursing home chain fails
Ten years ago, angry nursing home workers faced off against private equity mogul David Rubenstein — accusing his Carlyle Group of being interested in nothing but sucking profits from HCR ManorCare, the nursing home behemoth it had purchased the previous year.
Rubenstein tried to assure the 40 or so protesters that Carlyle paid $6.3 billion in a highly leveraged buyout “to make the company better than it is.”
Fast-forward to Monday, when ManorCare collapsed into Chapter 11, a victim of a $7.1 billion pile of debt created by Carlyle, and at least one of the protesters feels vindicated.
The protester a decade ago, Trisha Miechur, an HCR nurse, protested Rubenstein’s appearance at the University of Pennsylvania’s Wharton School because she feared Carlyle would not take good care of the company.
“I was really nervous and I stuttered when I [climbed up on the stage and] spoke to him,” Miechur told The Post on Monday.
After Miechur said her piece and as security led her away, Rubenstein, speaking about Miechur, told the audience, “I think a remedial English course would be helpful.”
Carlyle’s history with ManorCare — the largest nursing home chain in the country in 2007 — was troubled almost from the beginning.
In 2010, Carlyle sold HCR’s real estate in 338 facilities to HCP, a real estate investment trust, for $6.1 billion — forcing ManorCare to pay rent.
The real estate sale allowed Carlyle to lock in a profit on ManorCare, a Carlyle investor said.
“From Carlyle’s perspective, they got all their money out a long time ago,” the investor said.
“It’s really the classic saleleaseback situation where the PE-owned company loses,” the investor said.
By 2012, ManorCare’s revenue did not cover monthly rent obligations.
It wasn’t the debt load that helped sink ManorCare but rather the huge top-line hit the company received from 2010’s passage of ObamaCare, a source close to Carlyle said.
In 2015, the Department of Justice sued ManorCare for allegedly exerting pressure on senior nursing home facility therapists to “exploit” elderly patients for profit.
The suit was dropped last November after the judge overseeing the case called the suit “a house of cards.”
Carlyle said at the time it maintained ManorCare’s high quality of care.
Even after 10 years, Miechur — who left ManorCare in 2015 — is still angry.
ManorCare, she claims, reduced the staff at her facility in Easton, Pa., after the 2007 Carlyle buyout.
Before the cuts, there were 13 patients per nurse. After the cuts, it went up to 18 patients per nurse, she said.
The day after the 2008 protest and the Rubenstein slam, the PE mogul called Miechur and invited her to dinner in Washington DC, where Carlyle is based.
“He offered to take me and my family out to dinner,” the retired nurse told The Post on Monday in a phone interview.
“I told him to screw himself,” Miechur said.