The McGuire Group and Absolut Care have linked with 1199SEIU and the Board of Cooperative Educational Services (BOCES), a New York state initiative that offers a variety of instructional and non-instructional career services. The union handles testing and processes tuition, which comes to $13,750 for the licensed practical nursing program plus $300 out-of-pocket expenses for supplies and uniforms; BOCES handles the curriculum, and McGuire and Absolut provide on-the-job training.

“Staffing challenges continue to plague the long-term care industry nationwide as we struggle to rebuild the workforce to pre-pandemic levels,” said Aaron Polanski, director of Workforce Development for The McGuire Group, in an email to McKnight’s Long-Term Care News. “Creative workforce development initiatives, including offering seamless opportunities to get paid, attend school and climb the corporate ladder, are attractive incentives. We are partnering with local schools, educational programs and organized labor to create a meaningful solution to these challenges that plague our workforce.”

In 2022, the McGuire Group’s Harris Hill Nursing Facility in Williamsville, NY, received a Workforce Development Initiative grant to support hiring efforts for licensed nurses, expand apprenticeships and address vacancies throughout its facilities. That grant, awarded through the state’s Department of Labor, was the first of its kind in western New York. McGuire used the funds to develop the initial BOCES partnership to provide classroom and clinical training for four employees at Harris Hill. 

“This gave them the opportunity to get paid to learn while providing a balance between work, school and other obligations,” Polanski said. Those students received their educational certificates at a graduation ceremony on Nov. 7.

Buoyed by the program’s success, the McGuire Group and Absolut Care expanded their outreach to include the 1199SEIU Upstate health care union and other BOCES programs. The apprenticeship curriculum includes coursework on topics such as regulatory knowledge, management and leadership training, and the application of clinical skills. That program helps students understand facility operations and why things are done a certain way, Polanski said. 

Employees must work at a McGuire or Absolut facility for at least one year and meet prescribed academic criteria to qualify for the apprenticeship program.

Overall, these partnerships allow approximately 60 BOCES students per year to complete their clinical rotations at McGuire’s and Absolut’s western New York facilities. 

McGuire is also deepening relationships with area high schools to offer skilled nursing as a career pathway. 

“It’s what’s helping us rebuild our nursing workforce and creating pathways that are changing lives,” Polanski said.

CMS Administrator Chiquita Brooks-LaSure told participants at an event in Washington, DC, on Wednesday that the agency’s operations will be in peril if the fiscal standoff continues, news first reported by Politico, a media publication focused on Congress and federal agencies.

The federal government is moving closer toward a shutdown, after narrowly averting one last month. Lawmakers have until Nov. 17 to reach a deal, but once again, agencies are activating contingency plans and preparing to close down, if lawmakers can’t strike a broad deal or at least pass stop-gap, continuing resolutions to fund specific agencies. 

In September, CMS said that it had “sufficient funding” for Medicaid through the end of the year, due to its 2023 appropriations. At that time, the agency would not say if all of its operations would continue. McKnight’s Long-Term Care News attempted to reach CMS Friday, but there was no response with federal offices closed in observation of Veterans Day.

Politico reported that Jon Blum, principal deputy administrator for CMS, provided a statement that said state survey agencies “would likely not be able to complete all statutorily required nursing home surveys” if funds expire and the partial hiring freeze continues. The agency has been working to improve oversight of nursing homes and other facilities, the publication noted. 

But McKnight’s recently reported that year-end data for FY2023 for CMS shows that there has been little improvement in long-standing survey delays that were worsened by the pandemic. Nearly 30% of nursing homes have not had a recertification survey in more than 15 months, according to CASPER data captured between Oct. 1, 2022, and Sept. 30, 2023.

US Sen. Bob Casey (D-PA) issued a report in May that was severely critical of CMS’ survey system. The report from the Special Committee on Aging gathered 2,000 pages of documents and data on survey lapses and found 32 survey agencies had inspector vacancy rates of 20% or higher, with the highest in Kentucky, Alabama, and Idaho.

“The current funding uncertainty poses an immense threat to CMS and nursing home state survey agencies around the country,” Casey, who chairs the Special Committee on Aging, told McKnight’s in a statement Friday. “These critical agencies are already facing a crisis of understaffing and underfunding, and a hiring freeze extended by an unnecessary government shutdown would exacerbate a problem that is putting nursing home residents at risk.”

If the government does shut down at the end of this week, agencies will furlough staff unless they are deemed “essential.” Federal contractors would also cease work, although some may continue in essential roles.

Just as in October, it remains unclear what impact furloughs will have on CMS. Last month, the agency said that 49% of its staff – 3,236 employees – would be retained in roles that are already funded, are exempt, or are “deemed necessary.” Those roles were not defined in the agency’s contingency plan.

Whistleblower Trilochan “Bobby” Singh was the vice president of operations and chief operating officer of Paksn Inc., for seven years, during which time the government alleged the company’s owners engaged in multiple kickback schemes to defraud Medicare and Medicaid. Singh’s objection to the settlement was rejected by US District Judge Stanley Blumenfeld Jr., for the Central District of California on Nov. 3 who said Singh lacked merit. 

“In sum, [Singh] has neither identified any assets that the government overlooked nor shown that the government’s assessment of Defendants’ ability to pay was erroneous,” Blumenfeld wrote. “His objection essentially amounts to speculation that Defendants have been untruthful, and that the government has not done enough to root out assets that Defendants may have hidden.”

While acknowledging that the defendants — Antony and Prema Thekkek — were at least somewhat untruthful, Blumenfeld’s decision discussed the steps taken by a certified public accountant with more than 39 years’ experience of financial analysis and auditing experience to examine the Thekkek’s records and determine how much they could afford as the settlement. 

Blumenfeld also noted that Singh did not present any kind of proof to back up his claim that the Thekkeks were hiding resources. The ruling said Singh produced “partial records” that he claimed showed that Thekkek held interests in other facilities that had “millions of dollars in revenue” that the US Department of Justice failed to consider. But Blumenfeld noted that the documents are not the type the DOJ would use to determine a defendant’s repayment ability. 

“In sum, Relator has neither identified any assets that the government overlooked nor shown that the government’s assessment of Defendants’ ability to pay was erroneous,” Blumenfeld wrote, before denying Singh’s objection and approving the settlement. 

Singh filed a qui tam lawsuit in December 2015, and the government took over the case in June 2021. The Thekkeks were charged with submitting false claims from seven nursing homes they owned and operated in California: Bay Point Healthcare Center, Gateway Care & Rehabilitation Center, Hayward Convalescent Hospital, Hilltop Care & Rehabilitation Center, Martinez Convalescent Hospital, Park Central Care & Rehabilitation Hospital, and Yuba Skilled Nursing Center. 

The case centered around agreements the Thekkeks had with physicians to act as medical directors and in other roles at the facilities. In reality, the doctors were accepting kickbacks for facility referrals. 

“When entering into physician contracts, Defendants and the physicians did not intend that the physicians would spend much, if any, time performing such services,” the Department of Justice wrote in the original charging documents against the Thekkeks. “And, during the course of these physician services arrangements, the physicians, in fact, spent little-to-no time performing the listed services. The design of these contracts was not for Defendants to pay the physicians a market rate for lawful services rendered, but rather as a vehicle for the payment of kickbacks (in the form of a purported contractual stipend) to induce patient referrals.”

The documents detail the hundreds of thousands of dollars the Thekkeks paid to physicians for patient referrals to the various facilities.

A JAMA Network research letter, led by Thuy Nguyen, assistant professor of health management and policy at the University of Michigan’s School of Public Health, underscored the challenges skilled nursing providers have faced in filling vacancies, even as the federal government remains focused on adding new positions.

Nguyan found that employment in skilled nursing facilities was declining 0.2% per quarter in the prepandemic era from 1.7 million to 1.6 million workers, but the decline accelerated during the pandemic by 1.1% per quarter, down to 1.4 million workers. 

“Staffing in SNFs had already declined before the pandemic and further declines after the pandemic are concerning,” the researchers wrote in the letter published on JAMA Network Thursday. “The differential employment trends across healthcare subsectors may be driven by worker concerns of infectious disease threats, modest wage levels, and high turnover rates among many long-term care occupations.”

Overall, the research found that employment at nursing homes was down by 10.5% compared to pre-pandemic levels while hospitals were down 3.3% and physician offices were down 1.6%. 

In an interview posted to the University of Michigan’s website, Nguyen said that the research could help inform public policy since there are few studies examining the broader healthcare workforce. 

“The findings of our research can help to define the scale of the challenge faced by policymakers,” Nguyen said. “These declines in SNF employment levels are likely multifaceted in nature, and the Biden administration’s [staffing] proposal alone is unlikely to fully address the myriad of reasons for declining employment in this healthcare subsector.”

The other researchers involved in the letter, which is titled “Changes in Employment in the US Health Care Workforce, 2016-2022,” are Christopher Whaley of Brown University, Kosali Simon of Indiana University, and Jonathan Cantor of RAND Corp. They analyzed national labor statistics from the US Census Bureau. 

Joseph Schwartz, the former head of Skyline Health Care, is under federal indictment in New Jersey for failing to pay $29.5 million in payroll and unemployment taxes as well as 22 criminal counts, including benefit plan fraud. But US District Judge Susan D. Wigenton issued a continuance due to more than 2.5 million documents that are expected through discovery in the case.

The discovery is “expected to be voluminous,” according to an Oct. 6 order noted in an Arkansas Business article published Monday. A trial date has not yet been set.

Schwartz’s empire started to take off in 2015 and, one at point, his companies owned or operated more than 100 nursing homes in multiple states. In 2018, facilities in Nebraska were sent into receivership and dozens of others in Massachusetts, Pennsylvania, South Dakota, and elsewhere were taken over by states or were bouncing checks for employees and vendors, as McKnight’s Long-Term Care News has reported.

Schwartz has since been portrayed by critics as a sign of what can go wrong with nursing home ownership groups, and has been cited as the impetus for numerous reform efforts.

A former insurance agency owner, Schwartz was charged in Nebraska for filing $59 million in fraudulent Medicaid charges at 22 nursing facilities there. He also faces charges in Arkansas where he accused of submitting false cost reports that exaggerated Skyline Health Care’s costs by $6.3 million and receiving overpayments of $3.6 million by Medicaid.  

In 2019, Kansas passed a new law requiring nursing homes to provide more details about their finances and owners, partly in response to problems with Skyline Health. The state had taken over 22 nursing facilities, 15 of which were operated by Skyline Health Care, which owned millions of dollars in missed payments to vendors, McKnight’s reported.

In total, the US Department of Justice has accused Skyline Health Care of not paying employment and unemployment taxes for more than 15,000 employees at 95 facilities in 11 states. Earlier this year, a potential deal was announced before Arkansas Circuit Court Judge Karen Whatley, who presided over a negligence case there in which Schwartz was involved. He was ordered to pay $15.7 million to the family of a woman who died in one of the nursing homes his company controlled. 

Schwartz has asked the court to reverse that liability finding, saying he is just an investor in the facility and has “never visited Arkansas, and I had no personal connection with the day-to-day operation of any of the nursing homes in Arkansas.” He said he sold all holdings in Skyline Health in mid-2018, but the transaction was not completed until the following year. 

Human resources personnel also need better tools and to be more diligent in vetting prospective workers, an employment attorney told McKnight’s Long-Term Care News. Meanwhile, a Pennsylvania nursing home exec lamented that providers couldn’t warn future employers of problematic employees even if they wanted to, and is supporting legislative change. 

Their comments come in response to the multiple new charges leveled against a former nurse accused of murder and causing the deaths of at least 17 nursing home patients. On Thursday, the Pennsylvania Attorney General announced dozens of new charges against Heather Pressdee, including two counts of first-degree murder and 17 counts of attempted murder.

 “There’s a high probability that in the court of public opinion, everyone will blame the nursing home for hiring a killer nurse, despite having done everything right,” said Jacqueline Vance, RNC, CDONA/LTC, a former national Director of Nursing of the Year and senior director of Clinical Innovation and Education for Mission Health Communities, LLC. 

Before Thursday’s announcements, McKnight’s had previously reported that Pressdee either quit or was fired from 11 nursing facilities since 2018 and at the time of her arrest in May, her nursing license showed that it was in good standing. She also had been disciplined for “abusive behavior toward patients or staff.” Seven of the 11 facilities Pressdee worked at in western Pennsylvania over 11 years were nursing homes. 

McKnight’s reported that Pressdee had been disciplined for “abusive behavior toward patients or staff” at several facilities, which led to her quitting or being fired from 11 facilities since 2018. Pressdee told law enforcement officials that she “felt bad” for patients’ quality of life and “had hoped they would just slip into a coma and pass away.”

Vance said there is a “big flaw” in the process that licensing boards can disclose only whether an individual’s license has been suspended or revoked, and not whether someone has been required to take part in probationary programs due to workplace transgressions such as diverting drugs or inappropriately administering medications. She added that when she oversaw hiring at past employers, she would call previous employers to ask whether an individual was eligible for rehire. 

While that strategy worked well at the time, Jeffrey M. Daitz, co-chair of the Labor and Employment law practice for Hall Booth Smith, said HR offices are now advised to provide only neutral references about dates worked and salary history. When asked whether a person would be rehired, Daitz said he tells clients to say that it’s a matter of policy not to answer such questions.

“Employers are somewhat hesitant to give an accurate and true statement in terms of why someone is leaving because they’re concerned about a negative reference and being brought into a lawsuit,” Daitz told McKnight’s Friday. 

He added that nursing facilities “are doing everything they can” to attract employees, which can mean that the intensive vetting that should be done is not always happening. 

“Unfortunately, they’re letting their guard down because they need a body to staff the building to meet [staffing] regulations,” Daitz said. 

In addition to in-person interviews, HR staff should be checking with licensing boards, state ombudsman offices, and public databases to learn if a prospective employee has been involved in lawsuits against previous workplaces, Daitz noted. Facilities must also monitor a person during their probationary period to verify their work quality and determine their fit as a caregiver, he said, adding that nursing staff who come from staffing agencies should be given an extra look into why they are not employed in a nursing home.

“Sometimes, agency employees have lesser qualifications,” Daitz said. “You’re [hiring] someone who may otherwise not have been able to get a job in a nursing home.”

Pressdee’s case bears similarities to a New Jersey nurse who admitted to killing 29 patients in hospitals by injecting fatal doses of drugs in IV bags and through other methods. In response to that, New Jersey now has The Health Care Professional Responsibility and Reporting Enhancement Act — also known as the Cullen law — that requires healthcare professionals or entities to notify the state’s Division of Consumer Affairs with information about any healthcare professional who may be acting in a way that could harm patients. Daitz said it also allows workplaces to give negative information to prospective employers about former employees. Charles Cullen worked at 11 hospitals and other healthcare facilities over 16 years. 

Daitz said that law should be expanded to other states so that healthcare facilities can better vet applicants and be able to give “truthful” information. 

Providers want to share ‘red flags’

Count Zach Shamberg, the president of the Pennsylvania Health Care Association, in favor of that effort. 

“I think the key ingredient here and what was missed was that employers weren’t able to share their red flags that they saw with new prospective employers,” Shamberg told local ABC broadcast outlet WTAE.

Pressdee held positions at 12 healthcare facilities over a five-year span and resigned or was fired from all of them, according to investigators cited in the local report.

“We at the Pennsylvania Health Care Association have been looking to implement some sort of formal registry, some sort of system that could flag caregivers that are not fit to work in a healthcare setting, so we can stop this from ever happening again,” Shamberg said. 

Pressdee’s victims range in age from 43 to 104. Charging documents note that she administered the insulin typically during overnight shifts. A lawsuit filed on behalf of one of her victims alleged that facility administrators “not only brushed off concerns among staff about the woman, whom some colleagues called ‘the killer nurse,’ but disciplined co-workers who spoke about how Pressdee cared for residents.”

Vance said that nursing staff and others need to feel they can report inappropriate or questionable behavior without fearing retribution. Anonymous hotlines should be available in every nursing home, she said. Pressdee remains in custody at the Butler County Prison where she is being held without bail. She waived a preliminary hearing on the additional charges on Thursday and it was not clear how she pleaded in court. Her attorney did not respond to a request from McKnight’s for comment on Friday.

The legislation was applauded by provider groups who see the visas as a measure to offset the severe workforce crisis that is particularly harsh in nursing homes. 

“As we face a growing elderly population yet a shortage of healthcare workers, creating more opportunities for international nurses to immigrate to the U.S. will help strengthen our long- term care workforce and protect access to care,” said Clif Porter, senior vice president of Government Relations for the American Health Care Association/National Center for Assisted Living, in a press release issued by the Healthcare Workforce Coalition Friday. “These are dedicated nurses who want to serve America’s seniors, and they and their families should be welcomed with open arms.”

The Healthcare Workforce Resilience Act was reintroduced by Sen. Kevin Cramer (R-ND) and Dick Durbin (D-IL) and has several other senators from both parties as original co-sponsors. The bipartisan bill would allow the US Citizenship and Immigration Services to “recapture” green cards already authorized by Congress but not yet used. Up to 25,000 visas would be offered for nurses, and up to 15,000 would be offered to physicians. No new visas would be authorized under the measure. 

Additionally, the bill would require employers to make clear on supporting documentation that any immigrants receiving a recaptured visa is not displacing an American worker, and applicants would need to show they meet licensing requirements and have clean background checks. 

The immigration bill is supported by the North Dakota Long-Term Care Association [among others] Cramer noted.

The Healthcare Workforce Coalition said in its release that approximately 31% of registered nurses say they are considering leaving direct care positions in the next year. A study released earlier this year  from David Grabowski of Harvard University, Brian McGarry of the University of Rochester, and Jonathan Gruber of MIT found that federal policies to increase the number of immigrants working in nursing homes could help providers meet current and proposed staffing requirements. 

Immigrant groups already make up a “disproportionate share” of workers at nursing homes, about 1 in 5 at the direct care level, researchers said. They added that a backlog of permit processing is adding to the sector’s nationwide labor shortage.

“Skilled nursing care communities suffered workforce shortages prior to the pandemic and now it is at crisis levels,” Lori Stubbe, chief operation officer and a partner at Focused Post Acute Care Partners, said in a statement to McKnight’s Long-Term Care News Friday. The skilled nursing company has facilities in rural parts of Texas.

“It is challenging to attract and retain nurses particularly in those areas, so removing some of the administrative barriers for these visas and allowing an influx of educated and trained international nurses into the US workforce could provide much needed relief for those who care for our seniors,” Stubbe added. 

In September, the Centers for Medicare & Medicaid Services rolled out its proposed staffing mandate, which calls for facilities to provide a minimum of 3.0 hours per patient day of direct care — 0.55 hours of that by a registered nurse and 2.45 hours by a nurse aide. A press release from AHCA/NCAL applauding the Healthcare Workforce Resilience Act noted that nursing homes would have to hire an additional 100,000 caregivers to satisfy the demands of the proposal.

Infection Preventionist Carol Williams said she struggled to find a pharmacy to administer shots on-site and ran into a host of reasons for why she couldn’t access it. The LTC pharmacy that Rockwood Retirement Communities in Spokane, WA, contracts with and others told Williams that they didn’t know when the vaccines would be available, supplies were on backorder, or internal policies were having to be updated. 

“Just a lot of barriers,” Williams said during LeadingAge’s weekly policy update call on Monday. “I just reached out to everyone I could.”

One of those barriers was being told that the facility would have to pay $130 per shot upfront and submit that for reimbursement. 

Williams was finally able to hold a vaccine clinic Monday, using a small company the facility had worked with previously. But she noted that the company had a significant amount of anxiety returning to Rockwood since it did not get reimbursed for all the vaccines it administered during a clinic earlier in the pandemic. Williams said they were able to vaccinate  85 residents in skilled nursing, but there were approximately 30 senior living residents who signed up for the vaccine who will need to wait longer for their shots. 

“I was a little disheartened that with all the resources that we have, that the people who are most at risk for getting very ill … who wanted a vaccine were unable to have access to it,” Williams said. She added that staff could go off-site to a pharmacy, but the residents who are “most at-risk” had to wait until almost the last day of October to be vaccinated. 

Williams said that most of the community’s residents do choose to get the COVID and flu shots, but leaders are seeing vaccine fatigue, particularly among staff. The new RSV vaccine is causing confusion with many residents believing they don’t need the shot since they don’t plan to be around any babies, she said. There’s a knowledge gap on RSV among the general public and healthcare providers that Williams said she does her best to counter with educational materials drawn from every reputable source she can find. 

Williams’ experience mirrors the “hiccups” that have been described in mainstream media about the COVID vaccine rollout that began in late September. Jennifer Kates, senior vice president at KFF, told The Hill that the shots were a “completely new product,” resulting in rollout issues. 

“So with the vaccine transition, it was literally like one day the prior product that the government had purchased was the product you had access to,” Kates said. “As soon as the recommendations were made, those products were no longer authorized or approved for use. There was a whole new product that had to be provided to the market.”The Hill also noted that there were “widespread reports” that insurers hadn’t updated their coding systems, resulting in coverage denials. Still, another media report noted that, as of the week ending Sept. 22, approximately 1.8 million Americans had received the new COVID vaccine.

LeadingAge and other long-term care stakeholders met with administration officials last month to discuss ongoing challenges.

The American Health Care Association has said that most shortages still occurring were happening in pockets of the US and were not widespread.

“We are encouraged that many of the logistical challenges some were experiencing after the new COVID vaccine was approved are easing as well as by our ongoing conversations with the administration,” said AHCA/NCAL Chief Medical Officer David Gifford. “We greatly appreciate their support and collaboration. Working together, we must prioritize long-term care residents and streamline their access to the vaccines. Meanwhile, we must continue to educate members of the public about the importance of the vaccines through clear and consistent public health messaging.”

The 145 full- and part-time employees of a county-run nursing home will receive bonus payments that were promised as a way to keep them onboard during a lengthy sales process, despite the facility sale being canceled.

Workers at the DeKalb County Rehabilitation and Nursing Center were promised a $2 per hour bonus based on the number of hours worked from Aug. 1, 2022, until a sale to a private buyer went through, local media reported. But the sale is off as of Oct. 18, said county Administrator Brian Gregory, who declined when contacted by McKnight’s Long-Term Care News on Monday to say why the sale fell through. 

“There have been no discussions yet,” on another buyer, he said, adding that the country’s focus will be on maintaining operations. 

The DeKalb County Rehabilitation and Nursing Center has been in operation since 1853 and is the largest healthcare provider in DeKalb County. Although it has 190 beds, Gregory said there are currently about 100 residents. The county is in the process of identifying new funding sources, Gregory said. Notes from the County Board’s Oct. 18 meeting indicate that the facility is losing approximately $200,000 per month and has been operating at a deficit for several years. 

The bonus payments were intended as a retention program while the county pursued sale but with the termination of the expected $8.3 million transaction, county officials recommended still paying out the money. Employees will receive the bonus for time worked between Aug. 1, 2022, and Oct. 18, 2023. The nursing home has a 2-star rating on Medicare Care Compare site, although the rating for staffing sits at 4 stars. 

“[I]]t’s honoring that commitment to the employees that expected that this potential bonus could be there, so that’s the recommendation that came from staff,” Gregory told the County Board, per Shaw Local News Network.
Gregory told McKnight’s that the one-time bonuses will cost approximately $300,000.

Average monthly occupancy among skilled nursing properties in the company’s portfolio was 73% in September, compared to 72% in June, and 73% in March, said Clint Malin, co-president and chief investment officer, on Friday. By comparison, it was 71% in September 2022.

The REIT’s average skilled nursing occupancy in 2019, before the pandemic hit, was approximately 80%.

“Recent industry reports have … shown that current indicators point to a return to pre-pandemic occupancy levels by the end of 2024,” explained LTC Properties Chairman and CEO Wendy Simpson (pictured) during the company’s third-quarter earnings conference call Friday.

“While we cannot predict specific timing, we agree that the industry is making progress towards that goal,” she added. “Additionally, [temporary employment] agency usage is trending down in certain cases and the labor market is strengthening for operators in many areas.”

She tempered those comments by acknowledging that operators can still expect “some challenges” connected to “inflation, insurance premiums, litigation and SNF minimum staffing requirements, which pending the release of the final rule, will take several years to implement.”

Other positive market influences, she said, include the higher-than-originally-anticipated net 4% Medicare pay hike that kicked in on Oct. 1 and Medicaid increases at the state level that are putting some skilled nursing operators in a better position “to begin the improving margins.”

Simpson noted the company has been studiously working to reduce the average age of the properties in its portfolio while creating operator diversity and maintaining a balance of private pay and skilled nursing. Private pay occupancy also has continued to increase, rising to 85% in September, notably higher than the 82% and 81% rates registered at the end of the previous two quarters. The current rate sits within grasping range of the 2019 pre-pandemic rate of 87%.

Reasons for optimism

Overall, Simpson expressed an upbeat outlook.

“Bank lending is in flux, maturities are coming due for operators at a brisk pace and interest rate increases are causing anxiety,” she explained. “We think this environment favors REITs, especially those like LTC who maintain a conservative investment strategy and provide customized solutions geared toward the needs of operators.”

“We remain a patient investor,” added Malin, referring to LTC’s merger and acquisition strategy. “We are watching to see what happens with respect to pricing as current loans come due and owners don’t have the resources to refinance. Broadly speaking, we are hearing that banks are being more selective about seniors housing and skilled nursing investments potentially leading to more opportunities for LTC.”

He explained that goals for its Prestige Healthcare properties, a Michigan-based skilled-nursing heavy portion of the portfolio, remain on track. LTC Properties deferred $900,000 in interest payments owed by Prestige during the third quarter.

“The real story for Prestige is building back census and improving operations,” Malin said. “We’ve afforded them the ability to have a lower current pay while they’re doing that. And in addition to our participation in the retroactive Medicaid payments in exchange for implementing the current rate, LTC will be participating in 50% of the excess cash flow beginning January 1, 2025.”

He said any of that will be added into the letter of credit to provide “more security” and that it would be used to pay down accrued interest.

“We’re giving them a 2.5-year runway to make improvement in operations and improve margins,” he explained. “We fully expect to receive the contractual interest payment, not only in ’23, but in ’24 [and] 2025 as well.”

In other skilled nursing related-news, Pam Kessler, the company’s co-president and chief financial officer, said it expects to receive $30 million in the first quarter of 2024 connected to the payoff of a mortgage loan secured by a 189-bed skilled nursing facility in Louisiana.

More highlights and figures about LTC Properties’ third quarter can be found in this information sheet.

McKnight’s Senior Living’s coverage of the earning call also is available.