The long-term care industry will lose $94 billion over a two-year period as a result of COVID-related costs and revenue losses, according to a new forecast from the nation’s largest nursing home association.
The American Health Care Association/National Center for Assisted Living detailed its projections Tuesday. Its analysis found that providers spent an estimated $30 billion in 2020 on COVID-related costs, such as hiring more staff members and purchasing personal protective equipment. That number is projected to be $30 billion again for 2021.
In terms of revenue, nursing home operators have lost $11.3 billion in 2020. Provider losses are projected to rise to $22.6 billion in 2021, according to AHCA/NCAL.
The combination of revenue declines and increased costs resulted in 143 facility closures and mergers in 2020, the report stated. That’s projected to reach 1,670 closures/mergers in 2021 if business conditions do not change.
AHCA/NCAL said the findings justify the need for additional and immediate support for long-term care. The association called for allocating $20 billion to the long-term care industry through enhanced Federal Medicaid Assistance Percentage (FMAP) for long-term services and support, or through a dedicated portion to the Provider Relief Fund, top priority for vaccine distribution and access to testing and supplies.
“Congress and the Biden Administration must prioritize the long-term care industry and ensure the dedicated front-line workers of these facilities have the necessary resources to protect their residents and themselves,” AHCA/NCAL warned.