Long Term Care Providers Still Waiting for Further Financial Assistance Due to Pandemic

With the Delta variant causing surges in positive COVID cases across the country, the pandemic is far from over. Nursing homes and assisted living communities have been doing everything in their power to protect their residents from this deadly virus, but with increased costs to fight the pandemic, coupled with long-standing financial challenges, providers are struggling to stay afloat. 

This week, long term care providers sent a letter to U.S. Department of Health and Human Services (HHS) Secretary Xavier Becerra with a request that remaining resources in the Provider Relief Fund (PRF) be released immediately to health care providers, including long term care facilities. 

In 2020, nursing homes received $13 billion of the $178 billion of the PRF, which for many providers, made the difference between keeping their doors open or shutting them for good. Currently, approximately $44 billion remains in the fund; however, nothing has been distributed in 2021. In the face of mounting new cases due to Delta, the Administration should aid our frontline health care heroes before the situation gets worse. Public health officials must heed the lessons from last year and prioritize long term care residents and staff. 

During the pandemic, nursing homes have faced increased expenses for personal protective equipment (PPE), testing and additional staffing to ensure residents and caregivers remain protected from COVID-19. In 2020, providers spent $30 billion on PPE and staffing alone. But as the pandemic continues, these costs will remain constant. By the end of 2021, providers are projected to spend $60 billion on pandemic-related costs in the span of two years. 

These additional costs are causing a major strain on facilities that have long struggled to break even. Medicaid – the primary payer for nursing homes residents – has been historically underfunded. The amount that providers are reimbursed only covers between 70 and 80 percent of the total cost of care. This chronic gap in funding has left many providers operating on shoestring budgets year after year.  

Medicaid underfunding is contributing to workforce challenges that have been exacerbated by COVID. Providers across the country are seeking to hire more staff, but many lack the financial resources to offer competitive wages. Eighty-one percent of nursing home providers and 75 percent of assisted living communities stated that higher Medicaid reimbursement to offer better staff pay and benefits would help improve the facility’s ability to recruit and retain staff members.

In addition to bolstering the long term care workforce, proper financial support will help prevent widespread closures. The American Health Care Association and National Center for Assisted Living (AHCA/NCAL) estimates that nearly 2,000 nursing homes could permanently close their doors over a two-year period (2020-2021). Closures are detrimental not only to vulnerable seniors who rely on long term care for their health care needs but also to the dedicated caregivers who would be out of a job. 

In the letter to HHS, AHCA/NCAL President and CEO Mark Parkinson said, “The staff and residents in skilled nursing facilities around the country desperately need ongoing support in facilities most affected by the virus. Ensuring that this funding is delivered to long term care providers immediately is critical to our primary role of caring for and protecting our nation’s seniors and most vulnerable.”

Lawmakers must support the long term care industry and ensure economic stability for the sake of its vulnerable residents and dedicated caregivers. In the short term, providers can continue to protect their residents and staff from COVID-19. In the long term, they can continue providing the high-quality care that our seniors deserve for years to come.

The American Health Care Association and National Center for Assisted Living (AHCA/NCAL) represents more than 14,000 non-profit and proprietary skilled nursing centers, assisted living communities, sub-acute centers and homes for individuals with intellectual and development disabilities. By delivering solutions for quality care, AHCA/NCAL aims to improve the lives of the millions of frail, elderly and individuals with disabilities who receive long term or post-acute care in our member facilities each day. For more information, please visit www.ahcancal.org.