Post-acute facilities were hit hard by COVID-19. Occupancy declines, revenue losses, death of residents, and additional personal protective equipment costs all had significant impacts on the market. COVID-19 vaccinations for residents sparked a turnaround as cases and deaths declined and occupancy increased. The 2021 Post-Acute Market Report summarizes the significant challenges faced by post-acute facilities during the pandemic, analyzes current trends, and discusses the path to recovery over the next several years.
Key points include:
- Skilled nursing facilities are estimated to lose $94 billion over the two-year period 2020-2021.
- Nursing homes account for 32% of all U.S. COVID-19 deaths.
- 44% of post-acute organizations see occupancy returning to pre-pandemic levels in 2022.
- Executive Summary
- Post-Acute Overview
- Skilled Nursing Facilities Account For Over One Million COVID-19 Cases
- Nearly 90% Of Post-Acute Residents Are Vaccinated Against COVID-19
- Over One-Third Of Long-Term Care Workers Hesitant To Get COVID-19 Vaccine
- SNFs Lose Estimated $94 Billion During Pandemic
- SNF Occupancy Levels Plummet During Pandemic
- Post-Acute COVID-19 Cases Fall Sharply After Vaccines
- Over Half Of Post-Acute Facilities Were Testing Staff Weekly In March 2021
- Supply Of PPE At Nursing Homes Increasing
- Life Expectancy Declines Amid The Pandemic
- Occupancy And Staffing Top Challenges For SNFs
- PDPM Increases Reimbursement For SNFs
- Staffing Shortages At SNFs Worsen During Pandemic
- Medicaid’s Contribution To SNF Payer Mix Decreases
- SNF Medicare Spending Declined In 2019
- Over Half Of Nursing Facilities Invest In Technology During The Pandemic
- Post-Acute Market Declines While Home Care Spending Increases
- Senior Housing Merger And Acquisition Deals Drop To 7-Year Low
- Medicare Spending On Inpatient Rehabilitation Increases 8% In 2019
- Number Of LTAC Cases And Facilities Continue To Decline
- CCRC Occupancy Outperforms Non-CCRCs During Pandemic
- Assisted Living Occupancy Falls Sharply While Cost Increases
- Memory Care Occupancy At Its Lowest Due To COVID-19
- Clarivate Lists Top Post-Acute Care Products Sold Through Distribution
Prior to COVID-19, the post-acute market was valued at $375 billion. However, long–term care facilities accounted for nearly one-third of all COVID-19 deaths, occupancy fell, and life-expectancy saw year-over-year declines all impacting future market value projections.
COVID-19 was difficult for the post-acute market; estimates show skilled nursing facilities (SNFs) losing $94 billion through 2021. Reasons include lost referrals, lower occupancy, increased staffing needs, and additional personal protective equipment (PPE) needs. In 2020, the assisted living market value dropped 12% from 2019 to $21.5 billion. The Department of Health and Human Services (HHS) estimates that long-term care providers received $21 billion from the federal government to aid with the losses.
All Post-Acute Market Segments See Occupancies Plummet During Pandemic
The pandemic caused occupancy declines in all post-acute segments, but hit nursing homes the hardest. Skilled nursing facility occupancy fell to a low of 71.2% in January 2021, down from 85% in February 2020. Reasons for the declines included COVID-19 deaths, fewer hospital referrals, and families removing loved ones from nursing homes. In March 2021, after vaccines became available, SNF operators began reporting occupancy increases.
Assisted living facilities experienced the second-highest post-acute occupancy declines behind nursing homes during COVID-19, losing 6.1 percentage points since the beginning of the pandemic. The death rate among assisted living residents with COVID-19 was 21%, well above the general population’s rate of 3%.
Nearly 90% Of Post-Acute Residents Are Vaccinated Against COVID-19 But Some Workers Hesitant
By late March 2021, post-acute organizations reported vaccination rates of 88% among residents and 55% of staff. After several weeks of vaccinating nursing home residents there was an 83% decrease in cases and a 65% decline in fatalities. Thirty-five percent of nursing home/assisted living staff are undecided or do not plan to be vaccinated.
SNF Staff Shortages Worsen During COVID-19
COVID-19 worsened already prevalent workforce shortages as staff became sick, tested positive or quit to take care of family. To help offset the shortages 68% of SNFs hired additional staff, 94% asked staff to work overtime, and 86% paid bonuses to staff.
Senior Housing Merger And Acquisition Deals Drop To Seven Year Low
In 2020, 352 senior housing acquisitions were publicly announced worth a cumulative $7.9 billion, a more than 50% decline from $16.9 billion in 2019. Average prices for assisted living decreased 30% year-over-year and average prices for skilled nursing facilities declined 14%.