Occupancy continued to be challenged as the skilled nursing industry navigated the first months of 2021, according to the latest monthly skilled nursing data report from the National Investment Center for Seniors Housing & Care. Occupancy fell to a new low of 71.2%, dropping 0.4% below December’s numbers and 13.8% below pre-pandemic levels. 

The occupancy trend was consistent across geographies, as both urban and rural occupancy rates declined from December, dropping 47 basis points to 72.2% in urban areas and 29 basis points to a record low of 69.4% in rural areas, NIC reported. The organization is hopeful, however, that vaccination clinics in most skilled nursing facilities and the recent relaxation of some Centers for Medicare & Medicaid Services visitation guidelines may support some stability in the coming months.

The report also found that Medicare revenue per patient day declined from December to January, ending the first month of the year at $552. That’s up, however, from March of last year, when the RPPD was $549. This change likely is due to the fact that the federal government has been supporting Medicare fee-for-service reimbursement with higher rates to help care for COVID-19 positive patients requiring isolation. That support is likely to change, however, as case counts have declined sharply at SNFs as vaccinations ramped up. Meanwhile, Medicare revenue mix continued to increase at 24.1% and is up 2.4% since the pandemic began, compared with other payer types, including managed Medicare, which has dropped 0.1% and private, down 2.5% since last March.

Medicaid RPPD increased slightly in January to $238, which represents a 3.5% increase since the pandemic’s start. Yet covering the cost of care for Medicaid beneficiaries remains a major concern, NIC noted, as reimbursement growth does not cover the basic cost of patient care and services in many states.

“In addition, nursing home wage growth is elevated relative to inflation and staffing shortages are a significant challenge in many areas of the country,” report authors wrote. “Expectations are that wage growth will remain elevated as staffing challenges remain an operational hurdle due to turnover and competition for labor in other industries.”

This article appeared in the McKnight’s Business Daily, a joint effort of McKnight’s Senior Living and McKnight’s Long-Term Care News.