Despite falling occupancy and mounting Medicare payment pressures, a national consulting firm says providers are poised to benefit from the changing industry.

“The Silver Tsunami and the increasing capabilities of SNFs suggest that the future will be bright for facilities that can provide high-quality, cost-efficient care,” Plante Moran said in its first “Make the Mark” report, released in March.

The publication acknowledges that competition from home health and a focus on length of stay have driven demand for SNF services down since 2015. Providers with aging facilities or workforce shortages are most vulnerable to these trends.

But those who can manage care well by episode and adopt flexible labor models will be best prepared for success. The report found overall daily routine costs climbed by 4.5%, outpacing revenue growth from Medicare during the study period. But good news is coming, according to the analysts.

“Skilled nursing facilities should target for a lower Medicare length of stay to become attractive partners with hospitals,” report authors recommended.