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New financial survey—Call to action

Toby Pearson
By Toby Pearson  |  May 6, 2022  |  All members

Providers across the state face dire financial conditions that jeopardize access to care for Minnesota’s seniors according to a recent survey conducted by the Long-Term Care Imperative. See PowerPoint slides here.

The survey—which garnered responses from 156 nursing facilities and 179 assisted living settings—illustrates the challenges faced by providers during this unprecedented pandemic and workforce shortage. The findings of the survey are truly sobering and show that providers have been doing all they can to respond to the workforce crisis which is creating an existential threat for many of them.

Negative 8.7% operating margin for the average nursing facility
For nursing facilities, the most significant finding is that March financial performance was abysmal, with a median operating margin of negative 8.7%. If March is indicative of all of 2022, the average nursing facility will lose almost $900 thousand on operations, which is a huge problem when many of them have already used some or all of their reserves. The financial performance is driven in large part by huge increases in expenses, including the large number of providers who have given employee wage increases of more than 10% in the last two years and the number who are experiencing large spikes in both temporary staff use and cost of that staff.

One especially important finding is around the number of providers who are looking at sale or closure as they continue to struggle financially. 11% of nursing facilities, which works out to about 40 statewide, indicated they are looking at those options. That will have severe impacts on access if it comes to pass, and the number considering those options is likely to grow if the financial performance from March continues for several more months.

20% of assisted livings face closure 
For assisted living, the picture is also quite challenging. While their financial performance is not as negative as for nursing facilities, they are at a median operating margin of negative 1% in March. An even higher proportion of them have increased employee wages by more than 10%, and they are using reserves to cover those and other increased costs in many cases. While they are more able than nursing facilities to raise charges to stabilize their financial performance, the ability to do so will be limited by market realities and in many cases it has already been limited.

The number of assisted living providers considering closure or sale is even higher than nursing facilities, at around 20% or about 400 locations statewide. If numerous locations close that will cause huge access problems for this service, at a time when alternatives like nursing facilities are also under stress and may not be able to take the clients who are unable to access assisted living sites.

Action needed now to help struggling providers
The story told in the data is staggering, and the Long-Term Care Imperative understands the importance of sharing this story to help advocate for action. To help aid in our advocacy efforts and encourage the legislature to pass funding to support caregivers with the wages they deserve and ensure access to care for Minnesota’s one million seniors. 

We cannot address this crisis without your help and a bipartisan commitment to supporting the care our growing senior population needs. 

This starts with adjustments to state Medicaid rates for senior care services to support competitive, family sustaining wages. Currently, there are over 23,000 open positions in Minnesota’s nursing facilities and assisted living settings. Without sufficient staff, senior care providers cannot admit residents, and that has resulted in revenue losses for organizations throughout the state. 

In addition to efforts to garner media attention, we will be asking all providers to contact the governor on Monday, May 9, 2022, to share why action is needed now. Our goal is to flood his office with calls that will illustrate just how dire the circumstances of inaction this session are. 

Here’s how you take action:
  • On Monday, May 9, 2022, call Gov. Walz at 651-201-3400
  • Tell the person who answers the phone that seniors and their caregivers are counting on action this session. Here are suggested talking points you can use:
    • Hello, my name is ____, and I provide care in a long-term care setting
    • According to a recent survey, approximately 40 nursing homes and 400 assisted living settings are facing closure
    • Without permanent investments from the state, the average nursing home is projected to lose over $800k this year alone
    • I am grateful COVID response funding and frontline worker bonuses, but one-time money will do almost nothing to fill the 23,000 open positions across the state and help us stabilize this critical sector
    • In the final stages of the legislative process, we respectfully ask that seniors and their caregivers be your top priority—invest in the wages professional caregivers deserve and help ensure access to care for Minnesota’s growing population of seniors!
    • Please support the Senate’s Health and Human Services bill that funds permanent wage increases needed to recruit and retain professional caregivers
  • Let us know you’ve made a call, particularly if the person answering the phone shares any specific information with you

Thank you for your advocacy. With only a few weeks left in the legislative session, we’ve got to keep the pressure on to garner support for the funding needed to pay caregivers the wages they deserve and ensure access to care for Minnesota’s seniors.  

Toby Pearson  |  Vice President of Advocacy  |  |  952-851-2480


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Care Providers of Minnesota is a non-profit membership association with the mission to Empower Members to Performance Excellence. Our 900+ members across Minnesota represent non-profit and for-profit organizations providing services along the full spectrum of post-acute care and long-term services and support. We are the state affiliate for the American Health Care Association/National Center for Assisted Living, and with our national partners we provide solutions for quality care.

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