A recent Skilled Nursing News survey of nursing home operators found cautious optimism about the near-term future of the space, with a majority seeing a clear path to the future even without additional government support.
At the same time, operators have largely been pouring that federal largesse — including CARES Act grants, Payroll Protection Program (PPP) loans, and Medicaid rate increases — into personal protective equipment (PPE) and payroll expenses amid the ongoing COVID-19 pandemic.
Just 12% of respondents to the voluntary survey indicated that they could only sustain operations for at most three months once relief funds were exhausted, with an additional 25% seeing between four to six months of runway at current elevated expense rates.
By contrast, a full 45% said they could maintain the breakneck pace of coronavirus spending for six months or more, and 18% had no concerns about their future stability.
SNN invited readers to answer a series of questions about their organizations’ income and spending during COVID-19 between August 17 and September 14. All told, 170 representatives from Medicare-certified skilled nursing facilities participated in the non-scientific poll, designed to capture a snapshot of the novel coronavirus’s financial impact on nursing home finances and operations.
More than 85% of respondents indicated the receipt of some form of federal relief, with the blanket cash injection for Medicare providers as the most common. Among the least-cited programs was the Federal Medical Assistance Percentage boost from Congress, with just 20% reporting an FMAP benefit; the blanket increase in the federal government’s share of Medicaid funding did not always trickle down to nursing homes in every state.
PPE procurement led the list of top outlets for federal relief cash at 39%, with 25% citing making regular payroll as the primary use for stimulus funding. Bonuses and incentive pay came in third place at 15%.
More than half, or 57%, of survey participants reported investing in technology during the pandemic. Of that group, 85% indicated spending on telehealth services — coverage of which the federal government and other payers have greatly expanded during the COVID-19 pandemic — and 72% put money into virtual activities and engagement, including tech that facilitates remote visits with family members.
Finally, SNN asked operators for the top concerns expressed by their capital providers — including real estate investment trusts (REITs), banks, and private equity sponsors. The vast majority, 68%, said their financial backers were most worried about occupancy levels, with staffing far behind in second at 15%.
Despite the very public controversy around lawsuits and potential immunity for nursing home operators in multiple states, just 3% of operators said their capital partners were most concerned about legal issues, the least-cited worry among the options presented.