The $1.3 billion investment for resident-centered care included in the Nursing Home Improvement and Accountability Act serves as a clear signal that some lawmakers are willing to support nursing home alternatives coming out of the COVID-19 pandemic.

But with high design costs and a greater demand on the staff that work there, converting the more than 15,000 nursing facilities in the country, most of them built in the 1960s and 1970s, won’t happen overnight.

What is clear is that the push to smaller facilities with private rooms and open spaces looks like it’s more than just a phase for the industry.

Sens. Bob Casey of Pennsylvania, Ron Wyden of Oregon, Richard Blumenthal of Connecticut, Michael Bennet of Colorado, Sheldon Whitehouse of Rhode Island, and Sherrod Brown of Ohio, introduced the bill earlier this month, which includes a section for a demonstration program establishing skilled nursing facility building modification incentives.

“By investing in a culture change, we can ensure a more resident-centered experience and a model of care that leverages the strengths of the community,” Casey wrote in a statement to Skilled Nursing News. “My Nursing Home Improvement and Accountability Act would support the implementation and integration of resident-centered models in nursing homes and help improve the experiences of residents.”

While Casey noted there were several concepts that would be eligible for funding in the program, such as one in the works at the Clearfield County Area Agency on Aging, another that has continued to grow over the course of the coronavirus pandemic is the Green House Project.

Designed with private rooms, a more engaged staff and large communal spaces, Green House homes look to be a place that residents want to live.

Susan Ryan, senior director of the Green House Project, told SNN that it opened nine homes in Arkansas during the pandemic, and an additional two homes in Pennsylvania. Green House now has 359 properties — an increase from 298 before the pandemic began, Ryan said.

Among those 359 homes is Otterbein SeniorLife, the largest small house provider in the U.S., which started working with the Green House Project several years ago and now has 47 small houses in operation with 470 beds.

The non-fit has invested at least $81 million in its small house campuses, with a $12 million expansion underway that will see two rooms added to each house across its portfolio as Pamela Richmond, chief strategy officer at Otterbein, sees the Green House design as a better way to provide privacy, dignity, personalization, choice and infection control.

“Smaller scale, high-quality rated models like the Green House Project provide small self-contained family-style houses that offer community-based alternatives to nursing homes,” she said at the American College of Health Care Administrators Midwest Post-Acute Executive Leadership Summit during a presentation on Green House designs.

Though she admitted there are monetary obstacles preventing more operators from making the transition.

“It’s no small task to get the financing that you need for these homes,” Richmond said.

How to pay for it

Otterbein SeniorLife operates small homes across the state of Ohio and is expected to complete a 90-bed expansion by the end of the year that will add rooms to each of its 10-bed designs, bringing the total to 12 at each to help offset operating pressures.

Construction costs at one of their 10-bed homes totaled just under $2.5 million, with 20% of the project costs paid through an Otterbein corporate loan and the other 80% paid through long-term debt.

In order to be eligible for the demonstration program in the Nursing Home Improvement and Accountability Act, facilities must have between five and 14 residents, each with private rooms.

“I want to encourage you, you may not be with a nursing home that has the ability to put in the environmental changes that I am talking about, but the most important change is in your mindset,” Richmond said. “You can do this anywhere. We still have six traditional nursing homes, but this is our philosophy within those nursing homes.”

After the COVID-19 pandemic exposed some of the problems with shared rooms, with one study showing that 31% of coronavirus deaths could have been prevented at one facility if all residents had single rooms — momentum for private rooms continues to build.

Mark Rayner, director of health facilities at John Knox Village of Florida, would like to see better incentives for operators to invest in small home designs like Green House.

“I think money has been a barrier why more communities haven’t done the model,” he said. “Perhaps legislation will help the process along. It’d be nice to see more elders take advantage of this style of living.”

The Woodlands at John Knox Village, part of the John Knox Village continuing care retirement community, has over a dozen Green House properties and Rayner said the transition came at a high cost.

“We had $6 million in donations for a $35 million seven-story project. The other piece is the operational cost,” he said. “We staff 60% higher than a traditional nursing home.”

Staffing challenges

The Woodlands requires at least 250 employees to staff its 14 homes and Rayner admitted it’s been a challenge to meet those demands at a time when nearly every nursing home operator faces staffing storages.

“We celebrated five years of being open in June and we’re still not fully staffed,” he said.

Green Homes also expect more from the caregivers.

“To find that universal worker who cooks, cleans and provides care is definitely a cut above the routine institutional-minded certified nursing assistants,” he said. “It’s been a nightmare. I’ve had to use agency nurses for the first time in my 30 year career and they are just not invested in John Knox and the Green House model.”

In order to deal with these issues The Woodlands offers its nurses higher wages, benefits and a resident-sponsored scholarship program.

Ryan said the Green House Project typically recommends higher salaries for its workers, which, in an industry with increasing wages and a shrinking applicant pool, may not be an option for everyone.

Staffing improvements are at the core of the recently introduced legislation with $50 million allocated for the U.S. Department of Health & Human Services (HHS) to conduct studies every five years to determine minimum staffing levels and staff-to-resident ratios, beginning in 2022.

“When we’re doing financial modeling, we typically recommend a 10% increase from what the typical certified nursing assistant rate would be, but some have gone above and beyond that and others say that’s outrageous and their rates are highest in the area and they can’t go quite that high,” Ryan said. “When we did a survey, I think the lowest was a 3% increase. There’s an increase because we believe the job, the education they get, is commensurate with a higher wage.”