WASHINGTON, D.C. – The American Health Care Association (AHCA) today released a new report outlining the financial impact of the COVID-19 pandemic on the nation’s nursing homes. The report, produced by CLA (CliftonLarsonAllen LLP), highlights that the cost of care and other operations in nursing homes is far exceeding their reimbursement rates, resulting in a projected 4.8 percent negative margin. The industry is also facing a historic workforce crisis and significant declines in occupancy as a result of the pandemic. The unprecedented challenges have resulted in reduced access to care for seniors and individuals with disabilities across the country.
Key findings from the report include:
“When you look at the big picture and everything that nursing homes are facing both pre-pandemic and today, it’s a major cause for concern,” said AHCA President and CEO Mark Parkinson. “When nursing homes struggle to stay afloat, it is our vulnerable residents who need around-the-clock care that ultimately lose. Long term care needs government resources to address staffing shortages and ensure access to care for our nation’s seniors. That means we require immediate assistance to respond to the current crisis, and we must have a stable and sustainable reimbursement system moving forward.”
Parkinson recently sent a letter to Congressional leadership, requesting that federal lawmakers replenish the Provider Relief Fund with $20 billion allocated to the long term care sector. The fund has been depleted, but only aided providers through the end of the first quarter of 2021, despite new COVID variants—Delta and Omicron—causing havoc on the nation’s health care systems last year and in early 2022.
“This report is a comprehensive view of the current financial state of the nursing home industry,” said Deb Emerson, Principal at CLA. “You cannot simply look at one piece of the puzzle, such as Medicare payments. Inflation, labor costs, COVID resources – all of these have a significant impact on the ability of nursing homes to continue providing care to their patients every day.”
The full CLA report is available here.