Uptick in Elective Surgeries May Not Boost SNF Occupancy

A noted rise in elective surgeries for seniors, perhaps to pre-Covid levels, may not translate into a bump in skilled nursing occupancy.

Roughly 44% of physicians estimate that there will be more elective surgeries in Q2 compared to Q1 – but 60% of those surveyed said they expected skilled nursing discharges to be similar to the prior quarter.

That’s according to a survey conducted by Mizuho Securities USA LLC.

The survey found that 52% of physicians estimate surgery volume will be similar, while 87% of infectious disease physicians expect an increase in elective surgeries among seniors.

When it came to discharges, only 30% of physicians estimated volume would be higher in Q2 compared to Q1.

While it remains to be seen why exactly an uptick in surgeries is not translating to SNF discharges, Mizuho analysts opined that labor challenges leading to limiting occupancy likely have played a role.

Just last month the skilled nursing industry lost 2,500 jobs. The industry overall has lost 241,000 workers, or 15.2% of its total workforce since the start of the pandemic, according to data published by the U.S. Bureau of Labor Statistics.

Another component that may be impacting nursing home discharges is the potentially greater adoption of home health services.

When asked how physicians saw home health as an alternative to skilled nursing settings, roughly 38% of respondents indicated a “high” adoption among patients, 51% said a “medium” adoption and about 10% said “low” adoption.

Radiology (67%) and emergency medicine specialists (60%) have the highest adoption of home health among their patients, whereas oncologists and orthopedic surgeons reported the highest rate of “low” adoption – each at roughly 20%.

Skilled nursing admissions declined more than 24% between Q1 2019 and Q3 2021, according to the 2021 post-acute industry trends report from Atlanta-based health analytics company Trella Health.

Meanwhile, home health admissions between Q4 2020 and Q3 2021 indicate market stabilization, the report notes. The biggest issue the home health industry faces, like many other health care sectors, are the challenges surrounding staffing.

Mizuho analysts also noted the Centers for Medicare & Medicaid Services (CMS) recent announcement that several temporary waivers – including the temporary nursing assistant program – were coming to an end.

In its memo announcing the upcoming changes, CMS cited long-term care survey findings that linked resident weight loss, depression and pressure ulcers to the “lack of certain minimum standards.”

CMS expects facilities to redirect efforts back to meeting regulatory requirements and continue integrated practices to handle COVID-19 outbreaks moving forward.

“Potentially lower than expected increase in Medicare Payment rates, a modest pick-up in SNF discharges, and high labor costs are all risks to SNF tenant health,” Mizuho analysts wrote.