Pound for pound, senior living operators may be some of the biggest complainers to be found.
Nursing home operators are probably the worst. But there are also plenty of assisted living operators whose favorite chant seems to be that that the sky is falling.
Having heard variations on this theme for more than three decades, I no longer even bother to look up. For truth be told, operators have been wailing about unfair payments, laws and rules that whole time. And for a few decades prior.
Now don’t get me wrong. Many times, the concerns have been legitimate. But there were certainly other years when the pleas for relief sounded more rote than real.
That being noted, the past 30 months or so been real character-builders. Thanks to COVID-19 and its aftermath, occupancy is still down and costs are up, while staffing remains a nightmare. Plus we now have the added bonus of inflation rates soaring to a four-decade high. Even for non-crybabies, the pain has been all too real.
Now comes additional proof that things may be different this time. According to new data released by Gibbins Advisors, bankruptcies in the healthcare sector are trending up by more than 25% this year. Of those, more than half (54%) involve senior living and other long-term care settings.
Worse still, firm analysts expect the numbers to increase through next year.
“Healthcare organizations without adequate cash reserves to fund operating losses and debt service may face more difficulty in accessing capital in the current climate than the last two years, which can lead to more restructuring activity including bankruptcies,” Ronald M. Winters, a principal at Gibbins Advisors, said in a statement.
So maybe it’s time to give the Chicken Littles among us some credit. Their consistently negative messaging certainly gets tiresome. But this time, the warning just might be spot on.
John O’Connor is editorial director for McKnight’s Senior Living and its sister media brands, McKnight’s Long-Term Care News, which focuses on skilled nursing, and McKnight’s Home Care. Read more of his columns here.
