Recently released statistics for post-acute care in some states point to a trend away from nursing home stays, as closures mount due to labor troubles and low reimbursement rates.

According to the Boston Federal Reserve’s latest report on nursing home closures that was released Tuesday, more of New England’s older adults are aging in place, with state programs and family members often providing care.

Some states are also adopting programs that encourage the aging in place trend and reduce the need for long-term care. The Home Care Program in neighboring Massachusetts is an example of this government-led push to allow aging in place.

From 2010 to 2023, the number of nursing homes in New England decreased by 15%, while the patient count in facilities declined by 23%, the Boston Fed report states. It is noteworthy that the rate of nursing home closures in New England since 2010 is three times that of the U.S.

Senior policy analyst Riley Sullivan, who is the lead author on the Boston Fed report, said that nearly 15% of nursing homes in the region have closed.

Low Medicaid reimbursement rates that don’t match the cost of care are the main reason for the closures, along with a tighter labor market in the region, she said. 

“In 2023, low reimbursement rates from Medicaid and Medicare and high operating costs resulted in most nursing homes in New England losing money, suggesting the region could see more closures unless significant changes occur,” Sullivan wrote.

Closures in New England outpaced the rest of the country despite the region having the greatest share of older adults, Sullivan notes, and unless reimbursement rates are increased, the closures will likely continue. 

“In the United States and New England, the 85-and-older cohort is the fastest growing segment of the population,” the Boston Fed report states. “This group is also the most likely to rely on long-term care options, including nursing homes.”

And yet, the New England region has seen a net loss of 150 nursing homes since 2010, the Boston Fed report states.

“Compared with a decade ago, New England has more older residents and fewer facilities to provide care,” Sullivan wrote.