AHCA/NCAL State of Nursing Home Report Details Economic, Workforce Challenges

The report features data regarding COVID-19, the labor shortage, and access to care.

The American Health Care Association and National Center for Assisted Living (AHCA/NCAL) released its "State of the Nursing Home Sector," factsheet yesterday featuring data on issues affecting the post-acute sector. AHCA/NCAL released it ahead of President Biden's State of the Union address this evening, as a call to action to prioritize senior care.

Data was pulled from CMS, CDC, CLA, Kaiser Family Foundation, MACPAC, and AHCA/NCAL's own research.

While nursing homes have somewhat rebounded from the negative impact of the pandemic, according to Mark Parkinson, president and CEO of AHCA/NCAL, it's time for leaders in Washington to take further action.

"This report illustrates the impact that long-standing economic and workforce challenges are having on our seniors and their access to care," he said in a statement. "Nursing homes have done everything they can do to address these problems, but they need help."

Below are highlights from the factsheet.

Labor shortage

Nursing homes have struggled the most out of all health organizations, with 210,000 jobs lost over the course of the pandemic. The sector's 13% decline in workforce has lowered it to levels last seen in 1994.

At the current pace, the nursing home workforce won't be back to pre-pandemic levels until 2027. Currently, 84% of facilities are experiencing moderate-to-high levels of staffing shortages.

Providers are doing what they can, with 9 out of 10 increasing wages and offering bonuses to compete for talent in the competitive job market. Between 2020–2022, wages for nurses increased by 28%–34%. Regardless, 96% of nursing homes are struggling to hire staff, with another 97% attributing it to a lack of qualified candidates.

Financial struggles

According to the report, 62% of nursing home residents rely on Medicaid, while Medicaid only reimburses 86% of the cost of care. Combined with the inflation impacting the cost of nursing homes' goods and services, 55% of providers are operating at a loss.

Federal aids like the Provider Relief Fund, Medicaid enhanced FMAP, and state funding via the American Rescue Plan kept many nursing homes afloat during the pandemic, but that funding won't be available after this year. The report shows that at the rate things are going, 52% of nursing homes may not be able to remain open for more than a year.

Care accessibility

Due to the staffing shortage, 54% of nursing homes are having to limit their new admissions. Because of hiring challenges, 67% are worried they may have to close their doors.

There are 37,011 fewer beds available than there were in February 2020, and nationwide occupancy for nursing homes is at 76.6%. Over the duration of the pandemic, 465 facilities closed, with 41% being 4- and 5-star facilities.

Since 2020, 18,071 residents have been displaced due to facility closures, and 22 counties are now nursing home deserts.

What needs to happen?

Advocates have called for policymakers to make nursing home residents, the care that they receive, and their caregivers a priority. Staffing mandates and oversight measures have been proposed, but "do little to address the core challenges in long-term care."

The report suggests using a multifaceted approach to rebuild the sector's workforce and attract workers, passing bills like the Care For Our Seniors Act, and fully funding Medicaid.

"This is a call to action," Parkinson said. "We need lawmakers to pass meaningful reforms, both immediate and long-term, that aid providers in addressing our core challenges."