The big picture: Gut-check time for LTC

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John O'Connor, Editorial Director
John O'Connor, Editorial Director
Many an operator is now contemplating whether to remain in the long-term care field.

Having just returned from an NIC conference on the future of skilled nursing, I can offer a definitive answer: It depends.

The choice is obvious if you run a standalone facility, are not investing in technology, are not upgrading talent, do not have good relationships with nearby hospitals and health networks and plan to continue to operate more or less as you have in the past. Don't just walk away from this sector, run!

One of the points experts repeatedly made at the NIC show was about the pace of change. In sum, a seismic shift is just getting started. And it's being driven by both the public and private sectors.

Consider what's happening to the Medicaid program. For all its warts, Medicaid remains the industry's most reliable Sugar Daddy. But as anyone who hasn't been living on another planet for the past few years can attest, the program is in deep trouble.

Even if states had not just been handed new block grant options, they would be aggressively targeting Medicaid outlays.

And by the way, a temporary hike in the federal funding match is due to expire at the end of June.

The same reform law also sets up accountable care organizations. As proposed, these will be healthcare sub-units that offer comprehensive medical services (including post-acute care) to at least 5,000 people. The early betting is that hospitals and health networks will be providing the ponies for this race.

At a minimum, you should be looking for ways to reduce your organization's reliance on Medicaid dollars. You also should be assessing which local hospitals and health networks your organization might partner with — or avoid. It will be extremely helpful if you already know the people whose portraits adorn their lobbies. If not, you might want to set up a lunch meeting right away.

But before sitting down to break bread, remember that you'll need to show your new best friends what you can bring to the party. At a minimum, they will demand verifiable clinical competence and IT systems that speak their language. Then it gets kind of tricky.

Made up your mind yet?
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