Labor pressures continue to force creative operational decisions in Life Plan Communities, even as they enjoy a better overall employment rebound than stand-alone skilled nursing facilities.
Nursing homes still lag other healthcare settings in attaining pre-pandemic employment levels, at 14.2% below previous rates. That compares to a continued 12.6% reduction in Life Plan community staffing, according to a Fitch Ratings labor dashboard released Tuesday.
Still, those numbers are low enough to force Life Plan providers to shift their strategy in response to lower census and staffing, Richard Park, Fitch’s director of US public finance, told McKnight’s Long-Term Care News Tuesday.
Many Life Plan Communities are investing in assisted living and memory care services over skilled, and many have found they can provide services similar to skilled nursing in the less-regulated AL setting, for example.
“This seems to be aligning with a senior consumer preference to age in place by staying in independent living and in AL, over transitioning to skilled nursing,” Park said. “The current labor challenges could encourage LPCs to move faster on these AL and memory care projects to meet this need in the market.”
Park said that switch in care delivery focus is one of three solutions for the twin forces of a shallow labor pool and rising operation costs.
“The sector will need to grow the workforce pipeline, improve recruitment and retention, and become more creative and efficient in care delivery,” he said.
Park said many of the providers the firm rates were already in the process of reconfiguring post-acute care services, including reducing beds, before the current labor challenges. But persistent staffing issues are now another headwind.
The report noted the ongoing labor shortage has boosted wages from 18% to 21% for LPCs, assisted living facilities and nursing facilities from just before the pandemic through August 2022. In comparison, wage increases for the overall private and healthcare sectors ranged from 13% to 15% during the same period.
“Pressure on lengths of stay and reimbursement, the growing use of home healthcare over skilled nursing services for hospital discharges, along with a consumer preference to age in place, have already had many LPCs rethinking their skilled nursing service lines,” Park said.
