Quality isn’t necessarily a deciding factor when a nursing home closes. So suggests a new report that found both high- and low-quality providers were among the more than 550 facilities that closed from 2015 to 2019.
“It is not just low-quality providers that are closing,” said Brendan Flinn, LeadingAge’s director for Medicaid and home- and community-based services policy, who wrote the report.
He revealed that a total of 555 U.S. nursing homes shuttered between June 2015 and June 2019, which represents about 4% of the total number of facilities in operation. More than 40% had a 4- or 5-star overall CMS quality rating.
The closures aren’t a “monolithic problem” and don’t have a single specific cause, according to Flinn. He said real estate transactions and low reimbursement rates, both of which could harm providers of all quality levels, could be significant factors.
“As a result, even providers who are delivering high-quality care may find the business challenging, and for various reasons decide to move in a different direction, whether in response to shifting consumer demands for care or to address an operational need or goal.”
Findings also showed that Medicaid reimbursement is not covering the true cost of nursing home care.
In addition, occupancy decreased from 82.3% to 80.5% during the study time frame.
Finn said another significant influence could be changing consumer preferences, coupled with Medicaid long-term services and supports rebalancing, which shifts more money to home- and community-based settings.
The report makes several recommendations on how to address the closures. They include increasing advocacy efforts for additional Medicaid funding, designating critical access nursing homes, and reviewing current nursing home regulations “to separate those that are useful contributors to ensuring quality care from those that are costly and unnecessarily burdensome,” Flinn said.
