Are Nursing Homes Profitable?

A recent report from consulting firm van der Walde & Co., released by the Partnership for Quality Nursing Home Care found that one-third of nursing home operators had a zero total margin or net loss even before sequestration occurred.  Many of these operators siphon funds away from operational costs by creating administrative and back office costs.  The industry blames low profitability, tighter access to capital, and cuts to Medicare and Medicaid payment rates.

"Mounting financial pressures could even force SNFs to reduce expenses by means of cutting labor, limiting technology investments, as well as cutbacks to facility renovations and new equipment."

So they pretend not to make money so they can cut the staffing and beg for more government money.


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