During the pandemic, Nexion Health saw its agency staff costs increase by 12 times its base, from $1 million annually in 2019 to about $12 million each in 2020 and 2021.

Fran Kirley

Today, the company has cut, or is cutting, that expensive cord, with no agency staff in Texas or Louisiana, and a much-reduced dependence in Mississippi.

As with other parts of the business, CEO Fran Kirley credits culture with allowing the company to recruit, retain and improve its offerings to make long-term care jobs attractive.

“I don’t think people put enough effort on culture,” Kirley said in an interview with McKnight’s Long-Term Care News last week. “We believe that the culture of our organization rewards behavior, and encourages growth, education and support. We need to be a company that people want to work for, stay with and grow with.

“Our tenure reflects that,” he added. “I have colleagues say to me: I can’t steal from Nexion. I can’t recruit from you. That, to me, is the greatest compliment.”

Nexion operates 48 skilled nursing and two assisted living facilities in four states, some as outright owner, and the majority through leasehold agreements with Omega Healthcare Investors.

Those figures include an early pandemic expansion into 13 Texas facilities once operated by Daybreak Venture. They were released by Omega after Daybreak fell far behind on its rent payments, despite two significant deferrals.

But Maryland-based Nexion has boosted census there by 22% since the takeover. The effort to boost staff morale —  as well as increase pay, benefits and advancement opportunities —  have been pivotal factors, Kirley said.

“What we’re doing is working,” he explained. “It’s reflected in those 13 buildings in Texas. We’ve stabilized them, we’ve made them better. Our job is to make our people better, more successful, reward that behavior, grow them and hopefully reduce their stress because it’s a tough business.”

Committed to the Five C’s

Kirley founded Nexion in 2000. COO Meera Riner has been with him since the beginning, and the company’s senior leadership team has an average tenure of 16 years. Among regional staff, that number is just over 10 years.

And while COVID dealt Nexion many of the same challenges when it came to frontline staffing, the company has managed to retain many of its administrators and directors of nursing. They have an average tenure of six years.

Nationally, according to new data being posted by the Centers for Medicare & Medicaid Services, providers are churning through an average of 1.2 administrators annually.

Kirley said much of the success comes from a quality improvement process that fully involves building leaders and tasks them with surfacing issues and evaluating them as part of everyday operations.

Nexion uses the Baldrige Excellence Framework, the same method used by the American Health Care Association in its Quality Award program, to pinpoint weaknesses and build on strengths. They’ve operationalized the approach by creating working groups to conquer issues by type as they arise.

“When we started Nexion, we called it the Five C’s: clinical outcomes, census, customer service, culture, and cash collections,” Kirley explained. “Those are the five things where we put our Baldridge processes in place to maximize outcomes in each of those five areas, so that we don’t have cash problems, we don’t have customer service problems.

“If we get a negative customer service response, everybody looks at what the root cause of that problem is. What happened? What can we do to fix it? Was it poor communication? Poor training? We look in the mirror.”

Much of the data the company uses to inform its focus comes from a robust survey program. Nexion has partnered with Pinnacle Quality Insight to routinely survey employees and residents about their experiences and satisfaction levels.

That includes a heavy focus on new employees, who are invited to take a survey at the 15- , 30- , 45- , 60- and 90-day marks. About 40% of employees participate, a good share higher than Pinnacle’s average in nursing homes.

Nexion uses the information at the personal level to offer further training or intervene with employees who show dissatisfaction; it also collects and analyzes data by building and across the brand to consider new strategies for increasing engagement.

Responses reaffirmed the company’s decision to beef up its salary and benefits package, as well as its decisions to launch a next-day pay program that more than 1,000 employees recently have opted into.

When Nexion took over the 13 Texas facilities, it immediately offered upgraded benefits, including more competitive healthcare coverage and a 401K match. Also important, Kirley said, was folding employees into the culture early, asking everyone from maintenance to building leaders what they needed and then acting on those needs.

“Our culture of supporting people was transmitted in advance of the acquisition and it carries on today,” said Kirley, who has been involved in more than 500 acquisitions in his healthcare career.  “I always say, the most important things to do, there are three of them. No. 1: Make sure that you pay the employee; No. 2 Make sure you pay the employee, and No. 3, make sure No. 1 and No. 2 are done correctly.”

Recognition drives reputation

In addition to empowering employees, Nexion has frequently pursued public recognition of its buildings.

That effort resulted in three Silver Quality awards from AHCA in 2022, two of them to nursing homes. Overall, Nexion has had 57 Bronze winners, 30 Silver winners and a Gold nominee.

The company chooses its nominees based on their performance quality metrics and their ability to demonstrate how well the Baldrige approach can work in skilled nursing.

This year, Nexion is also pursuing recognition as a US News & World Report Best Place to Work, a ranking it sees as another good way to recognize longevity and drive recruitment efforts.

But Kirley’s most important push for recognition is among lawmakers, whom he sees as the key to long-term financial sustainability.

Despite spending millions more on agency over the last two years —  not to mention the increased costs of regular staffing, PPE and inflation —  Texas operators have had no Medicaid rate increase in seven years.

Louisiana and Mississippi have at least provided annual adjustments, Kirley said. Nexion has been able to maintain operations in Texas, thanks largely to additional payment earned through the state’s Quality Incentive Payment Program and a $19 daily COVID subsidy that will expire when the public health emergency does.

Though the legislature does not reconvene again until January, the former chair of AHCA’s political action committee has been hosting lawmakers for visits and trying to spread the word about the complex care being provided in today’s nursing homes. He’s also part of a 13-company group of larger operators working together on advocacy.

“We are projecting that around $40 a day is what we need to get as a rate adjustment in Texas to keep us whole,” Kirley said.  “You can’t expect quality when you have challenges of workforce, inflation, etc. and you don’t reimburse us. We’re getting grounded on that and we’re getting some momentum.”

Meanwhile, Nexion looks to keep its own momentum going. Kirley said he plans to divest the company’s sole Colorado property in the short-term, using the proceeds to complete a multi-site pick-up in the company’s current footprint by the end of the third quarter.

“All of that is a strategic approach to make Nexion more financially viable … adding things where it’s the right fit, so financially we can be stronger and more capable going forward,” he explained.