Would most adults choose to age in their own home versus a senior living alternative? Considering the chaos and aftermath of the global pandemic, the answer may not be a surprise. In fact, according to a 2021 survey from Capital Caring Health, 90% of adults age 50 and over would prefer to age in place.

Post-COVID-19, seniors aren’t the only ones preferring the home health setting. Family members making decisions about placement are choosing to care for their aging loved ones in their homes as a means to keep them safe from illness. Hospitals, insurance companies and other medical providers are also pushing home health care for a variety of reasons.

What does this trend mean for senior living and skilled nursing facilities?

Why the Surge in Home Health Care?

COVID-19 added a compelling element to a decision-making process that was already weighty for those involved. More so now than just a few years ago, seniors and family members are afraid of the prospect of a nursing home or senior living facility and asking, “Is it safe?” If a reasonable possibility exists for staying in a home setting, it has become the overwhelming choice post-pandemic.

There are a number of additional reasons for the boom in home health, beyond consumer sentiment, including:

• Lower costs and potentially better outcomes are prompting the Centers for Medicare & Medicaid Services (CMS) and many referral sources to push home health. According to CMS, sending patients home reduces the risk of hospital readmission and saves Medicare $6,500 annually per patient.
• Current CMS rules are facilitating the choice for home health care. As a result of COVID-19, CMS provided waivers designed to increase access to home health, including the waiver of certain restrictions on Medicare coverage of telehealth services. In June 2021, CMS also proposed rule changes to the Home Health Value-Based Purchasing (HHVBP) Model in an effort to improve home healthcare.
• Technology and innovation in areas like telehealth has made it easier to choose home health. In fact, 95% of health centers are offering telehealth options as a result of the pandemic compared to 43% in 2019, according to CMS.
• New legislation could make home health care feasible for more patients if enacted. For example, the Choose Home Care Act of 2021 would provide extended Medicare services, such as skilled nursing, in patients’ home for up to 30 days following hospitalizations or surgeries. Additionally, the Credit for Caring Act would provide up to a $5,000 federal tax credit for eligible working family caregivers.
• Many hospitals and acute-care providers are offering programs that promote home healthcare. For example, the Mayo Clinic launched an advanced care hospital-at-home model, which provides acute care such as skilled nursing, rehab, infusions and imaging at home. Other programs like Johns Hopkins’ CAPABLE aging-in-place program are designed to keep seniors out of skilled nursing facilities.

What Should Senior Living and Skilled Nursing Facilities Do?

COVID-19 caused decreased census levels for all healthcare providers at the height of the pandemic. While home health agencies have largely recovered, and then some, senior living and skilled nursing facilities are still struggling with record-low occupancy levels and drastic amounts of lost revenue.

To increase occupancy, providers can start with a focus on gaining referrals by demonstrating their value to referral sources. Furthermore, most senior care providers will struggle unless they rethink the status quo, reevaluate their business plan and determine whether it is still relevant.

Related Article: The Top 5 Metrics SNFs Should Focus on Today to Stay Viable and Competitive

We’ve compiled a number of changes for you to consider implementing in order to remain viable in a post-COVID-19 senior housing and healthcare landscape, including:

• Downsize. Although occupancy levels are starting to rise again, facilities are unlikely to see pre-COVID levels anytime soon. It may be time to reduce your number of beds available. While you may be hesitant to give up licensed, albeit unused, beds, certain states may provide incentives to do so. For example, the state of Ohio is working on a plan to buy back unused beds for around $10,000 each, provided that money is used for certain initiatives like converting double rooms to single rooms or other safety upgrades.
• Create a home atmosphere The majority of seniors prefer to be home. Accordingly, home is what you should aim to provide. Offering private rooms is a good place to start, particularly if incentives are available for doing so. Furthermore, those rooms should feel like home, not like an institution.
• Offer amenities. Potential residents and families considering choices apart from home health have numerous options for senior living and skilled nursing facilities. One way to stand out from the crowd is by offering a full range of amenities and conveniences such as a medical concierge – in place of aides – who can assist with a full range of residents’ medical needs, wellness services like fitness programs and social activities, high-quality food and restaurant-style dining options and resources like salons, post offices and worship services.
• Improve staff. Improving both the number and quality of staff is easier said than done at a time when good candidates are in short supply and a vaccine mandate is looming. Nevertheless, the era in which one nurse was adequate to serve 35 residents is gone. Senior living and skilled nursing facilities alike need to employ sufficient, skilled employees and provide them with proper training and respectable pay.
• Ensure adequate infection control. The pandemic highlighted numerous inadequacies surrounding infection control in both skilled nursing and senior living facilities. You need to reassure potential residents, their families and referral sources that your facility is safe and you’ve implemented the means to keep it safe, including adequate personal protective equipment (PPE), trained staff and appropriate infection control policies and procedures.
• Optimize care for Medicaid residents. The push by referral sources toward home healthcare means less post-acute referrals going forward. As Medicare residents decrease, long-term Medicaid residents will become your predominant source of revenue. While Medicaid rates may or may not improve soon, it is still going to be important to provide optimal care for these residents.

The Bottom Line

The senior living and skilled nursing industries have changed radically in just a few years. Providers will need to make fundamental changes to their business plans in order to accommodate the shift in attitudes and circumstances of the senior population.

Contact Richter’s Skilled Nursing and Senior Living Consultants

Richter understands the immense challenges you are facing as you attempt to navigate the current healthcare climate and sustain your business. If you need help in modifying your business plan or improving operations, call Richter’s clinical consultants at 866-806-0799 or schedule a free consultation.