By Jake Zuckerman
Ohio Capital Journal

Ohio’s nursing home industry poured at least $6.1 million into state politics and an array of dark money political groups between 2016 and 2020, an Ohio Capital Journal investigation has found.

The surge in spending comes as the state has steadily increased its payments to nursing homes through Medicaid, a state and federally funded insurance program for the poor and elderly that pays care costs for about two-thirds of long term care residents.

While reimbursement rates for other health care providers are determined by the Ohio Department of Medicaid, nursing facilities’ rates — the basis for $6.2 billion in long-term care spending every year — are guaranteed in state law.

The result is a system in which state lawmakers accept millions of dollars for their campaigns from nursing homes, and then determine how much to pay individual homes for the care of Medicaid patients — the source of most facility revenue.

Between 2011 and 2017, the average Medicaid reimbursement rate (per patient per day) climbed from $175 to $193, a 10% increase, according to data from Miami University’s Sripps Gerontology Center. A $1 increase in the rate — multiplied by the roughly 36,000 Medicaid patients and 365 days per year — alone bears massive budget consequences.

Most of the political contributions trace back to the Ohio Health Care Association, which says it represents about 1,100 long-term care providers that tend to an estimated 85,000 patients per day.

OHCA operates a 501(c)(4) non-profit entity that has contributed $3.4 million between 2016 and 2019 to a web of fellow 501(c)(4)s, tax records show. These types of entities, technically known as “social welfare” groups but more commonly referred to as “dark money,” are not required to disclose their sources of funding.

They generally operate in the shadows, avoiding the public scrutiny of individual and PAC contributions.

Of the $3.4 million from OHCA, $365,000 went to Generation Now, a dark money spender that pleaded guilty earlier this year to its alleged role in a pay-for-play political scheme.

Federal prosecutors accused then-House Speaker Larry Householder, R-Glenford, of secretly operating Generation Now to field nearly $61 million from FirstEnergy Corp. He then allegedly spent it to engineer passage of House Bill 6, a lucrative package of energy legislation including a nuclear plant bailout worth $1.3 billion to FirstEnergy.

Prosecutors also accused the late Neil Clark, a high-powered Republican lobbyist, of playing a key role in the scheme. Clark worked as a lobbyist for OHCA for 30 years.

Besides the commonality through Clark, both OHCA and FirstEnergy contributed heavily to two of the same dark money groups — Securing Ohio’s Future and Generation Now. An affidavit attached to documents used to arrest Householder even makes a reference to Householder’s fundraising efforts targeting nursing homes.

Bob Krapenc, an attorney representing Generation Now, declined to comment. Householder declined interview requests and did not respond to written questions.

The sudden rush of spending from the industry follows Householder’s return to public office in 2017 and his campaign to return to the speaker’s dais through 2018. After winning his House seat, he began a fundraising campaign to help elect a slate of Republican candidates who would vote him into the speaker’s office in 2019.