A recent survey by the American Health Care Association reveals some disheartening news.
If you believe the results of a survey of 463 nursing home providers by the American Health Care Association, well, we are in bigger trouble than I thought.
Apparently, 40% of the respondents said they would not be able to sustain operations for another six months at the current “pace,” which we assume to mean the current census and cost levels. A whopping 72% said they would not be able to sustain operations for another year.
The problem is that they, unlike the private pay seniors housing industry, have already received several billion dollars of financial aid to help during the pandemic. If they can’t survive while receiving the aid, then yes, they are in big trouble.
There will be closures and bankruptcies, and it may get real ugly, but I do not think that nursing homes are going to disappear. Values will drop, bargains will be out there for buyers, some lenders will be nervous. But always remember, skilled nursing facilities are the low-cost producer for what they do, and I don’t see many other providers volunteering to do it at a better price. We just have to get over this pandemic hurdle, and perhaps be a little better for it.
