The nation’s supply of inpatient rehabilitation facilities, long-term care hospitals and skilled nursing facilities continued to decline in 2019, contracting by 1.5%, 3.9% and 0.8%, respectively. That’s according to data released Friday by the Medicare Payment Advisory Commission.

The analysis also found that in 2018, the latest year for which data are available, the average total margin for freestanding facilities had dropped to –0.3%, the first year that it was negative since 1999. That’s despite the fact that the aggregate Medicare margin for freestanding SNFs in 2018 exceeded 10% for the 19th consecutive year.

MedPAC noted that Medicare margins varied widely across freestanding SNFs. Approximately 25% of SNFs had Medicare margins at or below –0.7%, whereas another and 25% of facilities had Medicare margins at or above 19.7%. High-margin SNFs reported 32% lower costs per day compared with low-margin SNFs, after adjusting for wage and case-mix differences, and 16% higher payment per day.

Facilities with the highest Medicare margins also had higher case-mix indexes, higher shares of beneficiaries who were dually eligible for Medicare and Medicaid and higher shares of minority beneficiaries, according to MedPAC. The nonpartisan legislative branch agency provides lawmakers with Medicare-related analysis and policy advice.

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