Florida’s Long-Term Care Facilities Pressured by Skyrocketing Property Insurance Costs

Over the past five years, long-term care facilities in Florida, including a few nursing homes but mostly assisted-living facilities, have been pressured due to a steep rise in commercial property insurance rates.

According to the state’s Agency for Health Care Administration, insurance premiums in Florida rose by 125% during this period, with an average of 146 facilities per year closed during a five-year period ending in 2023.

Bloomberg News reported that in 2023, premiums surged by 27% for Florida operators. This financial pressure has left many operators struggling to stay afloat, with some unable to meet their debt obligations.


The state’s booming population, coupled with a high proportion of elderly residents—22% compared to the national average of 17%—exacerbates the need for more nursing homes. However, the increased frequency of hurricanes and labor shortages have driven insurance costs to unsustainable levels.

Furthermore, citations for violations in Florida nursing homes have doubled over the past four years. In 2022, nursing homes were cited 83 times for placing residents in immediate danger, with more than half of these serious violations linked to staff shortages or insufficient training.

Kristen Knapp of the Florida Health Care Association noted that while citations capture specific instances of non-compliance, they don’t always reflect subsequent improvements made by facilities. She attributed the rise in citations, which increased significantly after new regulations in 2016, to these changes allowing multiple citations for the same violation.


“Several of those new requirements have resulted in high-level citations for a small percentage of facilities,” she said. “However, the vast majority of care centers in Florida are making great strides to improve quality and better health outcomes for residents.”

Knapp also told Skilled Nursing News that her organization has not seen a connection with rising insurance costs to closures of long-term care facilities, and that nursing home closures were uncommon.

“While providers, like everyone else, are concerned about the rising costs of property insurance as they are with other increasing costs such as food, utilities, and other operating essentials, in no way are we seeing facility closures as a result,” Knapp said. “Florida has a Certificate of Need process, ensuring nursing homes are built and beds become available in the areas where there is the most need for those services. As such, nursing home closures are very rare. We have 700 nursing homes in Florida, and not one of those homes have closed in the past five years because of property insurance costs.”

According to figures from Florida’s state regulatory agency Agency for Health Care Administration’s Facility Health Finder website, only a total of 17 nursing homes that have closed since 2018, Knapp said. “Only two of those closures because they were in Panama City and after Hurricane Michael closed due to experiencing extensive damage. Additional closures included 2 being closed due to regulatory issues,” she said.

Knapp said that rather than nursing homes closures, ALFs were more likely to close instead of undergoing a change of ownership to remain open. And about 165 ALFs with 10 beds or more did in fact close, Knapp said, sharing figures from the American Health Care Association (AHCA).

In Florida, there are more than 3,500 assisted living facilities (ALFs) and many are smaller, with anywhere from 4 to 16 beds, she said. Unlike nursing homes, ALFs do not have a Certificate of Need process so they do not have to go through approval by AHCA to build an ALF based on bed need or availability, Knapp added.

“However, I see no source that connects those closures to property insurance,” she said.

One thing no one is disputing is that the Florida’s long-term care facilities, similar to the situation across the nation, are facing troubles due to the labor shortages.

Despite legislative efforts to broaden the roles included in Florida’s minimum staffing ratios, staffing levels in the state’s 700 nursing homes have declined over the past two years, according to a recent AARP Florida report. The report found that staffing hours per resident per day dropped from 4.74 in April 2021 to 4.36 by October 2022.

Industry leaders in the state were critical of the staffing mandate.

“At a time when Florida’s long-term care profession is working tirelessly to overcome the labor challenges, this impossible and unfunded mandate will make it harder to recruit long-term care workers and ensure Florida seniors have access to the specialized and person-centered services they need,” Emmett Reed, CEO of the Florida Health Care Association (FHCA), said in a statement. 

Zahida Siddiqi contributed to the reporting.

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