Ensign CEO Port: Nursing Home Visitor Restrictions Likely to Continue for One, Two Months

One day after the federal government released tentative guidance for easing visitation restrictions at the nation’s nursing homes, the CEO of one of the top providers in the space cautioned that it’s still too early to consider widespread reopening.

“We expect that to continue at least for another month or two, even though there are plans that they’re starting to put in place to ease some restrictions,” Ensign Group (Nasdaq: ENSG) CEO Barry Port said during a Tuesday presentation at RBC Capital Markets’ 2020 Global Healthcare Conference, held remotely. “I think we’re a little ways away from that happening.”

Port was responding to a question about the Centers for Medicare & Medicaid Services’ (CMS) new plan, released Monday, for eventually removing blanket bans on nursing home visitation.

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Under the multi-phase proposal, nursing homes would first have to provide universal baseline testing for residents, with a reopening schedule that trails at least 14 days behind that of the general community.

“CMS recommends nursing homes do not advance through any of the stages of reopening or relax any restrictions until all residents and staff have received a baseline test to establish that there are no known cases of COVID-19 in the facility,” CMS administrator Seema Verma said. “In addition to the baseline test, we are calling on nursing homes to screen all staff daily and test them weekly. Further testing of residents may be necessary upon identification of coronavirus symptoms.”

Despite Port’s caution around reopening nursing homes, the Ensign CEO pointed to other positive signs in the San Juan Capistrano, Calif.-based operator’s portfolio, particularly around census.

“We have seen a significant flattening of that curve. Census in the beginning decreased fairly rapidly, and then over the last several weeks, it’s really starting to flatten — and in fact, over the last couple of weeks, it’s almost completely flattened,” Port said.

Those trends aren’t uniform across Ensign’s 225 skilled nursing facilities. In general, markets with early widespread exposure to COVID-19, such as Arizona and Washington state, have started to show glimmers of recovery, while the census curve hasn’t yet flattened in Texas and the Midwest, according to Port.

The CEO also pointed to the gradual return of surgeries in certain markets, including Texas, as a positive indicator for future admission growth.

“There’s been a lot of news about elective procedures stopping and slowing down at the start of this COVID epidemic, but it was really also vital procedures that slowed,” Port said. “We see a lot of those vital procedures starting to take place again, and will start to take place in a much more significant way over the next month or two. That will lead us, we think, to the beginnings of a recovery towards the end of the second quarter and in the third quarter.”

Unlike other public companies involved in either nursing home operations or real estate, Ensign did not withdraw its already aggressive guidance for 2020 in the wake of COVID-19, posting another record quarter for earnings during the first three months of the year.

Port, along with fellow Ensign executives Suzanne Snapper and Chad Keetch, on Tuesday reemphasized their optimism about the space, including the opportunity for acquisitions once the crisis passes.

Though Port acknowledged that some changes should come from the COVID-19 crisis, including new strategies for staffing and infection control in nursing homes, he insisted that the foundation of the business remains strong.

“As it relates to structural issues, I don’t foresee any. We all feel pretty confident that there will be a return to some normalcy in the health care environment — mostly out of necessity,” Port said. “We know that there are patients that are needing the services we offer, and we have an expectation that the environment will normalize.”

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