Running a medical facility is no walk in the park, regardless of the facility type. But SNF Operators battle a unique set of challenges that often prove to be too much for the unprepared. For this reason, more than 400 SNFs are expected to close this year in the United States. Whether you are considering operating a SNF or would like to get some helpful tips for navigating SNF-specific struggles, this article will be helpful to you. In this article, we’ll list the top challenges of operating a SNF in 2022. Let's get right into it.
Staffing Issues
The nursing and healthcare staffing shortage has touched healthcare organizations all over the U.S. - SNFs are not exempt. SNF operators struggle to maintain a complete and efficient team to care for their residents. When there are staffing issues, gaps in care develop, and patients pay the price. This is detrimental to residents and their families. In addition to the injustice to the patient, the SNF may also be liable for monetary damages. Lastly, every time a patient is neglected or otherwise placed in danger, and it’s publicized, it erodes society’s trust in skilled nursing facilities. Low occupancy and stricter industry regulations naturally follow.
Unfortunately, the staffing shortage will not be going anywhere soon. It is expected to last at least until 2030. Management must find a reliable solution to staffing issues to weather these times.
For many SNFs, nurse staffing agencies are a real boon. They allow SNF management quick and easy access to talent. Finding a staffing agency and using them as a safety net for staffing issues is always a good idea. That way, you won’t be caught without enough staff to care for your residents.
Lack of Profit & Governmental Regulations
One of the most pertinent issues plaguing SNFs in 2022 is negative margins, per the state of the skilled nursing facility industry report published just this year. SNFs are unable to earn and hold onto much revenue as it is, given that the majority of their residents have either Medicare or Medicaid. This is an issue because of the low reimbursement rates that these government-backed health plans offer. Private healthcare plans pay much better, but few SNF residents have these plans.
Low Medicare and Medicaid reimbursement rates is not a new issue for SNFs, but the issue is not going away in 2022. Worsening the issue is a 320 million dollar Medicare cut slated to occur in 2023, which will make it harder for SNFs to turn a worthy profit.
Labor costs also eat into the profits of SNFs. There are not enough skilled healthcare staff to go around, and that drives the expected pay rates for these professionals way up. So, facilities are paying more for nurses than they did before the shortage. And when a staff member leaves for one reason or another, getting someone to replace them quickly can cost a pretty penny.
New and Changing Nursing Home Regulations
Nursing homes have a checkered reputation in the U.S. While some residents thoroughly enjoy their stay at a nursing home, some patients suffer during their stay. Among the most common challenges that SNFs face are regulations put in place by federal and state legislatures to protect patients. Minimum care times, strict safety protocols, and more threaten to derail institutions en masse. In the vast majority of cases, it’s not that SNFs don’t want to take good care of residents; they often don’t have the resources to do so.
As of late, though, SNF care regulations have become a bit more relaxed in some areas. For instance, Governor Desantis signed a bill in April 2022 to reduce staffing requirements for Florida SNFs.
Overall, regulations are still a challenge for SNF managers to keep up with and adhere to. And if a SNF cannot meet regulations, fines or closure may follow.
Low Occupancy
Getting and keeping residents in beds is a long-time issue for skilled nursing facilities. At the end of 2021, occupancy in SNFs dropped after having risen for seven months. It has been slowly increasing in the first few months of 2022 but remains an ongoing issue for SNFs. Empty beds equate to missed opportunities for revenue and a reduction in profit. Compounded by low Medicaid and Medicare reimbursement rates, staffing issues, and more, SNF management is up against a formidable set of obstacles.
How to Combat SNF Challenges in 2022
Knowing about the most difficult challenges facing skilled nursing facilities is one thing, but knowing how to combat them is another. There is no single plan of action that will work for all facilities, and sometimes there is nothing a facility can do to stay open once it hits a certain level of financial strain. However, here are some practical steps any skilled nursing facility operations manager can take to help ensure the future of their facility:
- Stay abreast of all changes in legislation. Legislation is always subject to change. So, if you're not constantly looking for law changes/updates, you will miss something and regret it later. And being proactive pays dividends, as planning for changes can result in more time to identify the most effective ways to adhere to new regulations.
- Have a backup plan for staffing. When comparing agency recruitment to traditional hiring, the traditional route will almost always be cheaper. However, when traditional hiring is not possible, it's important to have an agency you can call on to close any employment gaps. You don't want your facility to be in operation without enough staff, as it could harm your patients and result in legal issues for your facility.
- Seek out grants and other free money. You may not be aware, but there are grant opportunities for SNFs. Securing these grants takes a load off financially and could even help struggling facilities survive a few more months. Finding these grants is almost always as easy as a simple internet search.
- Prioritize quality control. Without quality control measures in place, even if you have sufficient staff, the care provided at your facility could still be lacking. Draft a quality control plan and recruit the necessary staff to ensure that your facility is operating efficiently and lawfully.
We hope this article has been helpful to you and wish you the best whether you plan on heading up a SNF in the future or are currently managing one. Though it may seem like the world is against SNFs, your facility can survive with the right preparation and management.
