Majority of Nursing Homes Now Operating at a Loss

New survey from AHCA and NCAL shows nursing homes might be getting aid but are directing their spending to PPE and staff due to COVID-19.

• By David Kopf
• Aug 20, 2020

In what will be troubling news for HME providers supplying nursing homes, a new survey shows that those facilities are experiencing severe financial hardship due to COVID-19.

Fifty-five percent of nursing homes now operate at a loss now, with 89 percent at a razor-thin 3 percent margin or less, and 72 percent reporting they won’t be able to sustain operations another year at the current pace, according to the survey from the American Health Care Association and the National Center for Assisted Living.

What’s driving the cost increases? COVID-19 measures. Key costs include PPE supplies (90 percent of respondents), staff hero pay (78 percent), and additional staff (46 percent) are driving significant cost increases for nursing homes. 

Furthermore, 97 percent of nursing homes reported they lost revenue due to COVID-19, and nearly 60 percent said they expect significant problems with increased costs and lost revenue when government funding ends.

To get more details, providers can download a PDF of the full report.