Established nursing home business practices will soon change, expert warns

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Dan Mendelson, CEO of Avalere Health
Dan Mendelson, CEO of Avalere Health

Market and policy changes will force skilled care operators to dramatically change their business practices, an industry analyst said Monday. Successful operators will need to demonstrate quality care, risk management expertise and an ability to find complementary partners, according to Dan Mendelson, Avalere Health's CEO.

Mendelson was speaking at a regional skilled care forum sponsored by the National Investment Center for the Seniors Housing & Care Industry in Boca Raton, FL.

He said keys to future success include preparing for rate cuts, improving performance on Centers for Medicare & Medicaid Services outcomes measures, and positioning for integrated systems. As a result, data systems that work seamlessly with those of hospitals, managed care companies and other new partners will become essential, he advised.

Many operators also will need to increase staff. But recent Medicare funding cuts have caused many operators to reduce staffing levels, he observed. “Nursing homes are under so much pressure right now to cut costs, and I don't see much staff increase happening [now],” Mendelson warned.