There's a specific quirk about how this plays out—which @dylanlscott references in his write-up—that is worth, I think, elaborating at more length. It helps explain why the "marginal" patients here are actually older-but-healthier, not those we'd conventionally label "high-risk"
https://twitter.com/dylanlscott/status/1363965832326500354
Upon acquiring nursing homes, PE firms don't appear to universally scale back nursing staff. RN time actually increases. But so-called "frontline" nurses—CNAs and LPNs—their staff hours fall, more than offsetting the increase in RN effort.
RNs are, plausibly, the nurses you'd imagine to be most important for medically complex patients. But LPNs and CNAs play a critical role for patient health in supporting ADLs, doing things like bed-turning and infection prevention measures.
One of the most interesting hypotheses that the authors offer, from my perspective, is that the regulatory focus on RNs could be the driver here. PE firms might know where CMS is looking, so they're cutting elsewhere. 
To be clear, the authors aren't actually able to marshal evidence on this front—it's a post hoc exercise in making sense of the findings. But it strikes me as eminently plausible (and this is probably an "and" not "or" scenario, vis-a-vis explanations)
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