The post-acute market, currently valued at $245 billion, is projected to grow to over $350 billion by 2030. The rise in occupancy, reimbursement, and population growth have led to the revenue increase in the post-acute market. The 2023 Post-Acute Market Report highlights facilities’ efforts to endure post-pandemic economic pressures, technology innovations, and reimbursement changes.
Key Findings
- 43% of SNF executives predict that skilled nursing staffing challenges will begin to improve after 2024.
- Patient volumes in skilled nursing facilities have increased by 11% from 98,862 in January 2021 to 110,271 in January 2023.
- Continuing care retirement community (CCRC) occupancy levels increased to 91.5% in the fourth quarter of 2022.
Table of Contents
- Executive Summary
- Post-Acute Market Overview
- Skilled Nursing Profit Margins Continue To Decline
- Skilled Nursing Leaders Expect Occupancy Growth Despite Staffing Challenges
- Nursing Home Facility Growth Expected Through 2027
- Advanced Technology Is a Top Skilled Nursing Investment Priority
- Staffing Shortages Are Skilled Nursing Facilities’ Greatest Challenge In 2023
- Skilled Nursing Managed Medicare Payments Increase
- Reimbursement Changes That Impact Skilled Nursing Facilities In 2023
- Post-Acute Provider Flexibilities Reversed As COVID-19 Public Health Emergency Ends
- Skilled Nursing Facility Residents By The Numbers
- Price Of Nursing Home Rooms Increases Post-Pandemic.
- Number Of Nursing Home Compliance Deficiencies Remain Above Pre-Pandemic Levels
- Medicare Spending On Inpatient Rehabilitation Facilities Increases
- Assisted Living Operating Margins And Occupancy Rates Below Pre-Pandemic Levels
- Assisted Living Market Value Up 14% From 2021
- Assisted Living Facilities Experience Continued Worker Shortages
- Memory Care Market Expected To Grow Nearly 50% By 2030
- Continuing Care Retirement Community Occupancy Recovers Faster Than Other Post-Acute Facilities
- Clarivate Lists Top Post-Acute Products Sold Through Distribution
Executive Summary
Market At-A-Glance
The U.S. post-acute market is projected to reach $245.3 billion in 2023, an 11% increase from $220.4 billion in 2022. The post-acute market is slowly bouncing back from the COVID-19 pandemic that negatively affected many skilled nursing facilities (SNFs), continuing care retirement communities (CCRCs), assisted living, and inpatient rehabilitation facilities (IRFs).
Post-pandemic, staffing shortages continue to be the largest challenge across the post-acute market with a 13% decrease in nursing home employees between February 2020 and December 2022. Despite the current state of staffing shortages, 43% of surveyed SNF professionals predict that skilled nursing staffing challenges will begin to improve after 2024.
Post-Acute Facilities Experience Increases In Occupancy Levels
CCRC occupancy rates are recovering faster than those of other post-acute facilities. In the fourth quarter of 2022, the average occupancy rate at CCRCs was 87.2% while other post-acute facilities’ occupancy rates were 80.9%.SNF occupancy rates in 2023 have reached the highest level since 2020. Patient volumes in SNFs have increased 11% from 98,862 in January 2021 to 110,271 in January 2023.
Operating Margins In SNFs And Assisted Living Communities Continue To Struggle Post-Pandemic
SNFs and assisted living communities struggle to endure post-pandemic economic pressures. Skilled nursing facility profit margins are projected to continue to decline until 2027, while 37% of assisted living communities were operating at a loss through 2022. Key factors impacting post-acute operating margins in 2023 include occupancy, inflation, and labor costs.
SNFs Are Prioritizing Advanced Technology Platforms In 2023
Thirty-eight percent of SNF professionals are investing in new technology in 2023. Advanced technology platforms are improving care coordination, clinical workflow, and communication among post-acute providers. In 2024, the top advanced technology platform that SNFs are planning to invest in is information and communication technology(ICT) infrastructure.
Medicare Changes Positively Affect The Post-Acute Market
Medicare spending for SNFs and IRFs have increased in 2023. Compared to 2022, Medicare is now 22.1% of the SNF payer mix, previously 21%. The Centers for Medicare & Medicaid Services (CMS) released the final fiscal year(FY) 2023 payment rule in which Medicare Part A payments to SNFs will increase by 2.7%, or $904 million, compared to FY 2022.
