It’s no surprise that the Biden administration’s minimum staffing mandate was the source of Skilled Nursing News’ most-read story of 2024. From the proposal stage to its final form, our stories on the staffing mandate covered all aspects of its requirements as well as the legal and legislative challenges against it.
Our stories about the presidential election, comparing the Trump and Harris campaigns, for example, were also among our most-read, but we’ve excluded them from this list, given that the election is decided and Harris’ proposals are essentially moot.
Other stories that were popular with our readers included those on new and proposed regulations, such as the updated survey requirements as well as the federal agency’s Medicare revalidation paperwork requirement that seeks more ownership transparency of facilities.
The stories below recap these issues and others that arose during an eventful year, and help set the stage for what is to come in 2025.
1. White House Finalizes Nursing Home Minimum Staffing Rule:
Following a proposal issued in fall of 2023 after much talk around its parameters, the Centers for Medicare and Medicaid Services (CMS) released a finalized minimum staffing rule in April 2024. Sector advocates along with some providers immediately staged legal challenges to it. The rule mandates a total nurse staffing standard of 3.48 HPRD, including at least 0.55 HPRD of registered nurse (RN) care and 2.45 HPRD of direct nurse aide care. The additional 0.48 HPRD can be met by any combination of nurse staff, including RNs, licensed practical nurses (LPNs), or nurse aides. Furthermore, the rule requires an RN to be onsite 24 hours a day, seven days a week, to ensure the availability of skilled nursing care.
The rule didn’t go far enough according to consumer advocacy groups, but nursing home advocates pronounced it as a death knell for nursing homes, with one head of a state affiliate of the American Health Care Association (AHCA) calling the minimum staffing mandate an “extinction event.”
For its part, AHCA issued a scathing report on a crisis of access brewing if the staffing mandate were to be implemented. The organization, along with several providers, staged a legal challenge to the staffing mandate following attempts to convince federal authorities to drop the mandate. And, more recently, 20 state attorneys general joined the battle to derail the mandate, with a federal court in Iowa hearing arguments on whether to issue a preliminary injunction to temporarily halt the mandate. The judge seemed to question the federal government’s authority over, pledging to “work as quickly as I can” in issuing his decision while the legal and legislative challenges continue.
Among the myriad problems affecting the skilled nursing industry over the last five years, Medicare Advantage was identified as the top concern, as data analysis from cost reports showed a shift in operating margins, with more facilities struggling financially. Other influences named by CliftonLarsonAllen (CLA) analysts in this story included quality and occupancy, labor costs, Medicaid reliance, demographic shifts and industry consolidation.
Medicare Advantage enrollees made up more than 50% of all Medicare beneficiaries in many states. While nursing homes were focused on patient and resident care during the pandemic, MA organizations were busy strategically growing and “creating a bit of a chess match” within the industry, according to Stephen Taylor, principal of senior living and care segment leader for CLA.
“While Medicare Advantage is comprising more and more of enrolled Medicare beneficiaries, at the same time [MA is impacting] patient flow within SNFs, reimbursement rates, utilization, and administrative cost,” noted Taylor.
3. CMS Unveils Major Changes for Nursing Home Surveys for 2025
CMS aims to implement a series of major revisions to its long-term care survey guidelines, effective February 2025. The changes focus on a variety of areas, ranging from admission agreements and medication management to infection control and health equity considerations. This new guidance will streamline the survey process and eliminate overlapping citations, CMS said in releasing an advance copy of a 900-page document.
Speaking at LeadingAge’s annual conference in Nashville, Tenn., CMS Director Evan Shulman discussed nine different policy updates slated for 2025. He also clarified the intent and impact from the changes, including the newly issued guidance on Civil Monetary Penalties (CMPs) in the latest finalized payment rule for 2025. The federal agency’s work on risk-based surveys to reduce delays is also highlighted in this story.
5. LaVie Files for Chapter 11 Bankruptcy, Citing Skilled Nursing Sector Challenges, ‘Legacy Liabilities’
The story reveals how staffing problems played a big part in the bankruptcy of skilled nursing giant LaVie Care Centers, an operator of 43 skilled nursing and assisted living facilities. It filed for Chapter 11 bankruptcy in early June, while holding nearly $1.2 billion in debt. LaVie pinned its financial troubles mainly to staffing shortages that began during the COVID-19 pandemic, which forced the company to rely on staffing agencies.
Between 2020 and 2022, LaVie’s agency labor costs jumped by 380% to $277 million, its court filing stated.
“The challenges facing the skilled nursing industry broadly since COVID-19 are well known and persist today. These challenges combined with the legacy liabilities associated with operations that are no longer in the company’s portfolio are what precipitated these filings,” a LaVie spokesperson told SNN at the time.
The Atlanta-based company also stated in court filings that it was unable to curb losses and meet rent obligations to some of its largest landlords despite transferring nearly two-thirds of its facilities to new owners since early 2023, including 65 in Florida alone and 90 in total.
LaVie also found itself at the center of a lawsuit that claimed the company shifted ownership of some of its facilities in Florida to avoid payment on previous dispute settlements.
LaVie aimed to proceed through the Chapter 11 restructuring with support from Omega Healthcare Investors (NYSE:OHI), its main landlord and largest secured creditor. The Maryland-based real estate investment trust (REIT) is a landlord for 30 of LaVie’s remaining locations.
6. Inside the Rash of Abrupt Nursing Home Closures: The Key Factors at Play
Heading into the first quarter of 2024, the nursing home sector saw a concerning uptick in the abrupt closure of nursing homes with closures in New Jersey, Missouri, California and Vermont, displacing residents. And the closures continued all across the country, with Pennsylvania being notable among states.
7. Federal Court Approves Petersen Health’s Sale of Majority of Nursing Homes for $116M
Petersen Health Care’s sale of the majority of its properties to Cascade Capital Partners, a Skokie, Ill.-based real estate investment firm, was approved by a federal bankruptcy court, allowing Petersen to move forward with a significant reorganization following its bankruptcy filing in March. The story delves into the nursing home giant’s reorganization plan.
8. PACS Delays Q3 Earnings Release Amid Internal Audit and Federal Investigation
Nursing home operator PACS Group (NYSE: PACS), which debuted on Wall Street in 2024, delayed the release of its third-quarter earnings, following a report that sparked an internal audit and a federal investigation into its referral and reimbursement practices.
The story discusses the allegations of fraud made by Hindenburg Research, an entity which targets publicly-traded companies using public records, internal documents and employee interviews.
More stories
Below are the next five most-read stories on the our list. These also covered some important trends and developments that are ongoing heading into 2025:
Companies featured in this article:
Cascade Capital Partners, Centers for Medicare & Medicaid Services, CLA, CliftonLarsonAllen, CMS, LaVie Care Center, LeadingAge, Omega Healthcare Investors, PACS Group, Petersen Health Care
