On a remote stretch of U.S. 181, about fifty miles southeast of San Antonio, looms one of the biggest homes in Texas, the four-story, 29,000-square-foot, 34-room edifice on the estate known as Veladi Ranch. A marvel of architectural excess, the antebellum-style mansion is ringed by 28 towering Corinthian columns, three gigantic fountains, and 12,000 square feet of finished verandas. Inside are ten bedrooms, eleven bathrooms, nine fireplaces, a disco, a ballet room, imported gold and crystal chandeliers, tile imported from Italy, and plumbing fixtures from Germany. The home sits on a 240-acre, fully irrigated property, complete with stables, kennels, a 110,000-gallon solar-heated pool with poolside cabanas, a lighted clay tennis court, and even a dormitory for the staff.
This past July, nearly four hundred people went to Veladi Ranch for a highly publicized winner-take-all auction. The original owner, Arturo G. Torres, a Cuban refugee who came to Texas in the sixties and made his fortune opening Pizza Hut and Taco Bell franchises, had decided to sell the property after moving to San Antonio. The auction lasted thirty minutes, and when the gavel came down, the winner, with a bid of $3.63 million, turned out to be a large, jovial-looking 51-year-old man wearing a baseball cap, a blue T-shirt, and white shorts. Newspaper reporters, who had come to chronicle the event, had assumed the high bidder would be a legendary oilman or cattle rancher, but they had no idea who the new owner was. The man told them that his name was Woody Kern, he lived on a 44-acre horse ranch near the North Texas town of Pilot Point, and he owned an Arena Football League team in Tampa and a minor league baseball team in Asheville, North Carolina.
What the man did not mention was that he was known in court documents and government records as Peter Carlson Kern and that he had made his fortune in the decidedly unmythic business of operating nursing homes. Kern is the sole owner of Texas Health Enterprises ( THE), the largest nursing home chain in the state—its annual gross revenue has been estimated by a THE corporate representative in excess of $200 million—and also the most controversial. According to reports of government regulators, life inside many of Kern’s 112 nursing homes is far different from life at Veladi Ranch. At the company-owned Anson Place in Abilene, for instance, a frail 97-year-old woman was found lying helplessly in her bed while fire ants crawled over her body, biting her on the face, chest, legs, and arms—an attack that a hospital report said contributed to her death. At a THE home in Fort Worth, a woman with Alzheimer’s disease wandered out of the home. She was struck and killed by a car on a nearby highway. When investigators for the state’s Department of Human Services ( DHS) arrived to inspect the company’s largest nursing home, Carousel Manor, then known as Sweetbriar, a 265-bed facility in Brenham, they looked at the charts of sixteen residents and discovered that fourteen of them had developed multiple pressure sores (informally known as bedsores) since coming to the facility. If left untreated, these sores can turn deadly, burrowing toward the bone and causing infection. But the DHS investigators found that not only were the residents receiving little treatment for their sores but they were also not being adequately bathed or fed. Dried feces was spread over the buttocks of several residents. One woman was seen leaning against a bed’s rails, trying to eat with her fingers, her bed padding soaked with urine. One man, left unattended, was seen trying in vain to cut his meat patty with a spoon.
For millions of Texans, few decisions are more traumatic than the choice to place an elderly parent in a nursing home. Life in a nursing home is difficult even in the best of circumstances. Many of the residents are mentally disoriented, in constant pain, or physically incapable of taking care of themselves. The typical Texas nursing home resident is a widow over the age of eighty, and says Dolores Alford, a Dallas geriatric nurse who has a Ph.D in nursing and who consults with nursing homes around the state, “As older people live longer, their needs become far more complex. Today a good nursing home has to be more like a geriatric hospital than just a residential center staffed by a nurse and a few aides. But what’s so terrifying is that there are still homes out there that look good but end up neglecting or even abusing their patients.”
Despite legislation enacted over the past decade to improve the 1,161 nursing homes in Texas, including a tougher new state law just last year, government and industry officials agree that about 10 percent of the nursing homes in Texas consistently remain at substandard levels; one government consultant says 40 percent of Texas’ homes are of marginal quality, periodically failing to pass health and safety inspections conducted by the DHS. The number of citizens’ complaints about nursing homes is skyrocketing. Between March and August of this year, 6,718 complaints were lodged with the DHS, an increase of 63 percent over the previous six months. Of the some 94,500 elderly Texans residing in nursing homes, more than 6,300—about 1 in 15—live in homes owned by Texas Health Enterprises. DHS officials acknowledge that many of the company’s homes do meet government standards, but during 1997 and the first six months of 1998, 60 of THE’s 112 homes failed to meet licensing requirements when inspected. Since July 1995, the company has been hit with more than $3.7 million in DHS fines for violations. Since 1993, the state attorney general’s office has also filed 22 lawsuits against THE for, according to court documents, “acts or omissions that threaten the health and safety of residents.”
Nursing homes are not easy to operate. Nearly three quarters of Texas’ nursing home patients have an income low enough to qualify for Medicaid reimbursements, which are hardly generous. As a result, the