Staffing Woes, Rising Costs Continue to Force Nursing Homes Nationwide to Shutter

As operating costs remain high and staffing shortages persist, nursing homes across the country, particularly those situated in small markets, are closing their doors in response.

Staff, as a result, are then left with the decision to relocate to another facility perhaps many miles away, or leave the industry altogether.

Seven nursing homes in the state of Montana in the last six months have shuttered, amounting to 10% of the state’s beds, according to the Daily Montanan.

And that hasn’t only impacted rural parts of the state.

Bozeman, one of the state’s largest cities, now has only one facility left with a maximum capacity of 69 beds to serve the entire community after its largest provider closed, according to the report.

Nursing home providers cited the inability to operate on a $100 per day loss for each resident.

In Iowa, 11 nursing homes have reportedly closed, or are in the process of doing so, since late last year, The Gazette reported. The facilities closed largely due to financial stress related to inflation, labor strains and supply chain issues.

The closures have occurred in large cities like Davenport and Sioux City, to small towns like Shellsburg with a population of more than 800 people, the report noted.

Not-for-profit senior care giant Evangelical Lutheran Good Samaritan Society has had to close or sell nine facilities in just the last eight months — the majority of which were in rural communities.

It comes at a time when more than 1,000 nursing homes have closed since 2015, according to a report released back in April by the American Health Care Association/National Center for Assisted Living (AHCA/NCAL).

The April report cites data from the federal government and the CliftonLarsonAllen (CLA) 2022 State of the Skilled Nursing Industry.

AHCA/NCAL also projected that more than 400 skilled nursing facilities could close in 2022, with nearly 240,000 job openings as a primary driver.

When a nursing home closes in a smaller geographic area and the facility’s workforce leaves, there “really isn’t much of a community left,” according to CLA Managing Director Cory Rutledge.

“The community really is at stake in some of these situations, because they are either the largest employer or the second largest employer,” he previously told SNN.

The decision by the Centers for Medicare & Medicaid Services (CMS) to spread out the Patient Driven Payment Model (PDPM) cut over two years and bump pay 2.7% has brought a mixed bag of reactions over how this will impact the industry — and whether it could result in additional closures.

Some like Brickyard President and CEO Wesley Rogers say CMS’s decision met operators “more than halfway”, while others like LeadingAge President and CEO Katie Smith Sloan believe any cuts made at this time are “deeply disappointing.”