Food costs may take a bigger budget bite

Long-term care facilities should prepare to pay more for food in 2013, with prices going up as much as 4%, according to a prominent industry voice.

“Shifts in global weather patterns, the drought in the United States, inflation and instability in the Middle East will all affect the prices you'll be paying for everything, from eggs and milk to fresh produce and beef,” said Michael Greenfield, CEO of Prime Source, which handles purchasing for long-term care and assisted living facilities nationwide.

Greenfield's prediction is in line with numbers from the American Farm Bureau Federation, which in January predicted food prices would go up 3% to 4% in 2013.

While providers might not be able to escape the budgetary strains caused by food price inflation, they can be thankful the fiscal cliff deal stabilized dairy prices, which were in danger of spiking without the passage of a farm bill.

Operators may have taken heart following the Jan. 15 Producer Price Index, which showed food costs increased by the smallest annual amount in four years. Yet MarketWatch countered that optimism by saying food costs are all but guaranteed to rise in 2013.