Skilled Nursing Spending Rises Fastest in West, South

Spending on skilled nursing services rose the fastest in Nevada over the previous two decades, followed by multiple states in the South, according to a new report from the Centers for Medicare & Medicaid Services (CMS).

Payers in the Silver State — including Medicare, Medicaid, and private sources — shelled out $709 million for care at SNFs and continuing care retirement communities (CCRCs) in 2014, the most recent year for which CMS data was available. That’s a sharp increase from $114 million in 1991 and $438 million a decade ago, and good enough for an average annual rate increase of 8.3%, the fastest of the 50 states and the District of Columbia in that time. Four southern states rounded out the top five: South Carolina, Virginia, North Carolina, and Delaware.

In terms of pure spending, most populous state California predictably topped the list, with SNF and CCRC spending of $14.8 billion — a bill that’s higher than all of the states in the Southwest and Plains regions. New York came in second with $12.2 billion in expenditures across all payers, more than all of New England combined, followed by Pennsylvania, Florida, and Texas.


CMS also took a look at more recent Medicaid trends in its analysis, discovering an increase in the overall proportion of “less expensive” program enrollees following Medicaid expansion under Obamacare. While overall Medicaid spending rose 12.3% between 2013 and 2014 among states that elected to participate in the program, per-recipient spending dropped 5.1%. Conversely, among the states that declined, Medicaid spending still increased by 6.2% — but those states ended up paying 5.1% more per enrollee during that time span.

The report found wide gulfs in overall per-capita medical spending from region to region, with New England residents spending $10,119 on health services in 2014, 26% higher than the national average. Their counterparts in the Rocky Mountain region, meanwhile, had just $6,814 in medical expenses that same year, 15% lower than the average.

The timing of the report, with the most recent data still lagging three years behind the present, captured the lingering effects of the recession: All 50 states saw slower growth than during the period spanning 2004 to 2009, which CMS pinned squarely on the economic downturn. Still, lead report author David Lassman pointed out that the relative regional differences have remained stable despite the various shifts.


“During the 2009 to 2014 period, the variation in spending between the lowest and highest states was virtually unchanged,” Lassman said in a release announcing the report’s results.

Written by Alex Spanko

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