A Novel Idea: Bonus Payments to Skilled Nursing Facilities
We were heartened to hear that 10,631 nursing facilities will be receiving a total of $333 million from HHS based on improving COVID-19 metrics. While it sounds like a lot, it comes to just over $31,000 per facility. The good news is that this is just the first of five potential payments for good performance. The performance was for just one month, from August to September, whereby these 10,631 facilities had 1,200 fewer COVID- related deaths month over month. Apparently, this is all part of HHS’s goal to use a little more of the carrot and less of the stick when dealing with the nursing home industry. About 77% of the eligible facilities received the funds. It would be... Read More »
Welltower Is First To Report Third Quarter Results
As expected, Welltower reported a 150-basis point decline in occupancy in its 557-community seniors housing operating portfolio (SHOP) to 78.4%. The good news is that this is a much smaller decline compared with the second quarter’s drop of 490 basis points. Through October 23, occupancy declined by another 30 basis points since the end of September, and management expects the full fourth quarter drop to be between 75 and 125 basis points. The slowing decrease is positive, and while they did not forecast 2021 occupancy, as an industry, census has never increased in the first quarter, so even with the slowing trend line, occupancy for this large portfolio is expected... Read More »
The Ensign Group Reports Encouraging Results
The Ensign Group came out with its third quarter earnings, and contrary to many in the industry, the company reported rising revenues, net income and skilled mix. That news, plus the announcement that the company returned another $23 million of relief funds (on top of the previous $109 million announced last quarter), sent shares up by 6.3% to $60.19 per share, which is close to a near-term high of $61.98 per share achieved on October 14. By returning those provider relief funds, and reporting strong operating results, Ensign saw its market cap increase by over $130 million, so it seems like the move may have paid off. Combined same store and transitioning occupancy did decline by 2.4%... Read More »
Digging Out
Cases of COVID-19 are rising across the country, but providers are better prepared than ever to take care of our elderly. The coronavirus pandemic is spreading, and any notion of a vaccine by the end of the year has faded. Yet, even though we take care of the most vulnerable population, the senior care acquisition market seems to be stabilizing. More deals have been closing this month than in the previous several months. But what does this mean? Third quarter earnings reports start coming tomorrow, and no doubt the occupancy numbers from the REITs will show continued deterioration to new record lows. This is the unfortunate reality we are all dealing with. And as average occupancy goes... Read More »
Getting Ahead of Labor
The pandemic has riled operations at seniors housing communities and skilled nursing facilities across the country, and the long-term effects are still somewhat unknown. But one issue that was top of mind for many operators before COVID and will still be for years to come is labor. There are several facets to the issue too, from finding and attracting skilled labor to retaining staff to paying wages that are increasing every year. The pandemic has sent the unemployment rate straight up, but how many of those newly unemployed are really qualified to work in a senior care facility? Or want to. Probably very few. And retaining staff not adequately trained or prepared for the work is a hard... Read More »Schedule a demo
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