Weak economy forces nursing homes to freeze jobs, delay infrastructure projects, study finds

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Better Medicaid managed care oversight needed to protect providers serving high-risk populations: OI
Better Medicaid managed care oversight needed to protect providers serving high-risk populations: OI
A new study finds that difficult economic conditions are restricting nursing homes' access to capital. As a result, facilities are renegotiating supplier contracts, freezing jobs and holding off on wage increases, and delaying infrastructure projects.

"You think of the healthcare sector as immune to the economy, but this time it hasn't prove so," said Allen Dobson, president of Dobson DaVanzo & Associates LLC, a healthcare economics consulting firm. The Alliance for Quality Nursing Home Care commissioned the report from Dobson's company. It was released on Wednesday.

Access to all sources of capital is limited for nursing homes, according to the study. These include state Medicaid reimbursements, as well as credit instruments and equity. For the study, the company talked to nine major for-profit providers in January. All are Alliance members, Dobson said. It also sent a survey asking questions about the firms' financial, managerial and clinical experiences related to the financial crisis.

The study is posted on the Alliance's Web site at www.aqnhc.org.