Skilled Nursing News: 2023 Outlook for Skilled Nursing Shaped by Unfriendly Federal Policies, Confounding Deals, Labor Crisis.
The current skilled nursing occupancy gap compared to pre-pandemic levels is 99% due to a lack of staff, according to Phil Fogg Jr, CEO of Marquis Companies and chairman of the American Health Care Association. Fogg states that the recovery of occupancy will be dependent on the workforce and rejects the notion that post-acute care demand has waned.
Healy of VIUM Capital asserts that demand isn’t the issue but rather the federal staffing minimum ratio that would be “catastrophic” for the industry and set back modest occupancy gains in recent years.
Fogg is seeing an improvement in staffing, but operators still face rising costs from staffing agencies and there is a long-standing shortage of licensed nurses. Operators also face financial challenges with negative margins in 2021, and Kauffman of NIC says there needs to be improvement in public-private partnerships supporting the industry. NIC data shows occupancy dropped from 86.1% pre-pandemic to 79.6% as of the fourth financial quarter of 2022.