In the ever-changing healthcare landscape, skilled nursing and post-acute care facilities sit at the intersection of opportunity and challenge. While the demand for quality care has never been higher and is anticipated to increase, professionals are grappling with significant obstacles that limit their ability to serve an aging population.
But these obstacles are not insurmountable. With a total workforce strategy, skilled nursing and post-acute care communities can position themselves for growth, even in a time when 55% are limiting admissions and 61% are operating at a loss.
The three major factors causing facilities to limit admissions
1. The workforce shortage
Between too few people entering the industry and seasoned professionals leaving in record numbers, there are simply not enough healthcare professionals to meet demand. The workforce shortage will only get worse as the number of people over age 65 continues to rise.
In tandem, the nation will be short 200,000 to 450,000 nurses by 2025, according to McKinsey.
Healthcare workers leave the industry for myriad reasons. In our “Solutions to Healthcare Burnout Report,” we found that 81% have experienced burnout, 62% are at risk of burnout right now, and 49% have considered leaving the field altogether.
When there aren’t enough healthcare professionals on the floor, the remaining professionals are taxed: 54% of 1,800 senior care workforce members surveyed by OnShift in 2022 who had considered leaving cited the need for better workforce levels as a key reason. Add to that the moral injury of witnessing subpar care and experiencing symptoms of burnout, and the industry's high turnover rate begins to make sense.
2. Increasing operational costs
Workforce costs comprise the bulk of a facility’s expenses. Skilled Nursing News reported that, in 2023, the shortage of skilled workers was the main driver of increased costs, which have risen 30% since 2022. If federal staffing minimums go into effect, workforce costs are likely to increase even further (up to $500,000 more per facility).
But workforce costs aren’t the only rising costs facilities have to cover. Other costs associated with providing care have also risen — including food, supplies, equipment and insurance — have risen between 5% and 15%.
3. Decline in revenue
In many skilled nursing and post-acute care facilities, revenue decline can be attributed to the inability to accept new residents. Take Texas, for example, where the annual revenue from each single-occupancy room totals $85,107, while each double-occupancy room yields $61,503 per person.
But revenue per patient day is also tied to Managed Medicare, Medicare and Medicaid reimbursement. The National Investment Center reports that Managed Medicare revenue per patient day (RPPD) has decreased by 20.5% since 2012 and 0.8% since 2022. Medicare RPPD, however, has increased by 2.7% since 2022, and Managed Medicaid RPPD has increased by 3.0%.
This only underscores the importance of being able to accept new residents. But how can facilities do that cost-effectively when they are closing wings and even shuttering completely due to workforce challenges?
Is it possible to grow census during one of the most challenging healthcare eras in history?
Growing your organization might seem to be a wild idea when between 2020 and August 2023, the U.S. lost 45,217 skilled nursing facility (SNF) beds, 24% of SNFs closed a wing or a floor and 579 SNFs closed their doors.
Demands for care are growing, however. Since 2022, referral volume from hospitals to skilled nursing facilities is up 10%. The inability of skilled nursing facilities to meet those demands has driven up the average hospital length of stay by 12%.
That means that if your facility is able to secure adequate coverage, you’ll be positioned to accept admissions that others in your area need to decline. In the long term, you’ll be positioned to serve a portion of the nearly 27 million people expected to need long-term care in the next 25 years.
To do that, however, you need to build a total workforce.
What is a total workforce, and how can it help your organization grow?
The total workforce is based on a pragmatic view of the healthcare industry as it stands today. This new paradigm acknowledges that there is no way to meet demand using employees alone or offer residents continuity and quality of care without engaging outside workers.
A total workforce can help reduce employee burnout, which is correlated with turnover. And turnover is expensive — costing between $3,000 and $90,000 to replace an employee, depending on specialty. Those numbers don’t factor in the personal costs of training a new team member, finding a fit for your community, or the time it takes to find qualified replacements: 62% of industry leaders report difficulties in finding and hiring qualified full-time employees.
Facilities with total workforces have recognized that burnout is not only a financial and self-perpetuating public health risk; it’s a risk to their residents. Instead of siloing external workers and using them for emergency coverage only, facilities with total workforces welcome outside workers into their communities, relying on them to offer employees more perks, such as flexible schedules and additional time off. They also call on them to increase coverage when they need to meet increased demand.
These facilities are meeting a need that’s already there: 97% of healthcare workers surveyed for our “Solutions to Burnout Report” agree that healthcare workers need more schedule flexibility, and 78% of ShiftKey users who had left healthcare said that ShiftKey’s technology enabled them to return, underscoring the importance of schedule flexibility.
Since personal caregiving responsibilities compound burnout (81% of 1,000 healthcare workers we surveyed have personal caretaking responsibilities and 64% say balancing those responsibilities with their professional duties is difficult), flexibility is not just a perk but a necessary strategy in helping healthcare workers remain in the field.
Senior care leaders agree: in our “Senior Care Survey Report: Workforce 360,” 41% said they often allow employees to work flexible shift times, 40% said investing in technology that supports accommodations for flexible shift times is crucial to occupancy growth, and 41% said more scheduling flexibility would help retain employees.
Moving from crisis mode to growth mode
The first step in any total workforce strategy is to stop operating in crisis mode. To do that, you need to prioritize patient care and safety, limit expenses and better manage your recruitment processes.
Understand that if your facility is in crisis mode, you will need to rely more heavily on PRN shifts but only on a temporary basis, not a permanent one. As your facility stabilizes, you will move from crisis mode to stabilization mode.
In stabilization mode, you’re building consistency. You’ll focus on reducing employee overtime and burnout, investing in clinical management, enhancing orientation and training, rebuilding occupancy, ramping hiring, consolidating PRN partnerships and reducing your reliance on PRN shifts.
Now, you’re ready for growth mode. In growth mode, you focus on advanced workforce planning, maximizing occupancy, hiring appropriately, referral and mentorship programs, culture building, engagement and advancement, creative scheduling, optimizing labor costs and strategically using PRN shifts.
The journey is not linear by any means. The goal is to identify the actions you can take to limit your time in crisis mode and maximize your time in stability and growth modes.
Your facility’s success matters more than ever
When you achieve growth mode, your facility is agile enough to accept admissions requests. It can meet ever-changing industry regulations. It can offer residents better continuity and quality of care, which often lead to better CMS ratings and patient satisfaction scores. Employees get the flexibility, recognition, perks and professional development that they want. Administrators are no longer struggling to keep the lights on. It begins to feel like you’re building and nurturing a true community ― and you are.
It’s time for growth mode
Help your facility move from crisis mode to growth mode. ShiftKey and OnShift, a ShiftKey brand, offer unique yet complementary workforce technology products. We also offer an integrated solution, SAMI (Schedule Automation Marketplace Integration), which provides a complete view of your schedule — showing your employees and independent professionals in one place.
Facilities using SAMI have experienced an average 8% increase in occupancy within the last six months alone, bringing them a collective $111M increase in annualized revenue. Facilities using SAMI also experienced up to a 71% increase in employee shifts requests, reduced agency usage by up to 45% and more. Don’t get left behind! See what SAMI can do for your organization. Schedule a demo or call 1-888-963-3566 to get started today.
