LTC Bullet: What About Nursing Homes?

Thursday, January 8, 2004

Portland, OR--

LTC Comment: Nursing home residents are sicker, stays are shorter, and the number of nursing homes is shrinking despite projections based on demographics. What's happening? More after the ***news.***

*** Oregon has been a pioneer in long-term care service delivery and financing for decades. As for most states, however, the cost of providing long-term care through Medicaid has become a huge fiscal challenge here. This writing finds us stranded in an ice storm in Portland, Oregon en route to the Capitol in Salem. Discussions with Oregon Governor Kulongoski's health care policy adviser and officials of the state's Medicaid long-term care agency must await a thaw. Ice on the roads will melt long before the state budget unfreezes. But hopefully the Center for Long-Term Care Financing will be able to help. We'll recommend some ways to encourage private financing alternatives that can relieve the burden on Oregon's Medicaid LTC budget. ***

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LTC Comment: For many years now, C. McKeen (Mick) Cowles has published an annual "Nursing Home Statistical Yearbook." It's a fine resource we reference often at the Center for Long-Term Care Financing. To get the flavor of the Yearbook, check out the Table of Contents at and read the introductory article at . If you're concerned about quality nursing home care being available in the future, this is a good data source to follow annually. Order information for current and past issues is available at . The 2002 version, which is the most recent currently available, costs $95. Following is an interpretive essay regarding nursing home data trends.


"What Do the Data Say About Nursing Homes?"
Patty Munday

A lot of what people say or believe about nursing homes is based on conjecture, opinion or anecdote. In part, this is caused by the lack of good sources of current data on nursing homes. Although it is not without limitations, the data that the federal government collects in its Online Survey Certification and Reporting (OSCAR) database is a rich source of detailed data on nursing homes in the United States. The OSCAR data is a byproduct of the survey process. Every certified nursing home in the United States is surveyed every year, or at least every 15 months. The survey process assembles a wealth of information about the characteristics of the nursing home and its residents. Especially when viewed over a number of years, this database can tell us a lot about the state of nursing homes.

The Nursing Home Statistical Yearbook for 2002, published this fall by Cowles Research Group, compiles the most useful parts of OSCAR into a compendium of statistics on nursing homes. The book includes over 100 tables, charts, and graphs covering such areas as staffing levels, resident acuity levels, survey deficiencies, and resident ADL characteristics.

So what do all these numbers tell us about nursing homes and those who reside in them? One clear trend is a steady increase in residentís levels of dependency. For example, in 1996, 22% of nursing home residents were independently ambulatory (able to walk without assistance). By 2002, that number had dropped to less than 15%. By all measures of acuity, nursing homes are serving a much "sicker" category of residents than in the past.

The increase in acuity between 1996 and 2002 has occurred in every state. Some states had very high acuity in 1996, so the incremental increase in acuity was modest, such as in Hawaii. Others, such as Iowa, have seen a dramatic increase in acuity since 1996.

The OSCAR data used for the yearbook also show a steady decrease in the total number of certified (participating in Medicare or Medicaid), nursing homes in the U.S. since a peak in 1998. The total number of certified homes has dropped from a high of 17,259 that year, to 16,491 in 2002. This is a decrease of 4.4%, and is especially interesting when considered with the fact that the numbers of the very elderly (the most likely users of nursing homes) is currently growing rapidly. The drop in the number of nursing homes between 1998 and 2002 flies in the face of most demography-based predictions that anticipated steady and dramatic increases in the number of nursing homes.

Two trends seem to be working against this expected growth. First, the elderly are experiencing much greater health and lower rates of disability that allow more of them to avoid nursing home stays, or reduce the lengths of their stays. Secondly, assisted living and other options are serving many of the more independent frail elderly that in the past would have had no option other than nursing home care.

Historically, the Nursing Home Statistical Yearbook series shows that the four and a half percent fall in the number of nursing homes between 1998 and 2002 has been uneven across the States. The decline in the total number of certified nursing homes has been most dramatic in Arizona (18%), Texas and Massachusetts (12 % each), Oregon (11%), and Nevada (10%).

Not only is the number of nursing homes not growing, but the occupancy rate of nursing homes across the country continues to decline. Although individual statesí occupancy rates vary dramatically, the overall trend has been down since 1998. While the occupancy rates range from over 92% in states like New York, Minnesota and North Dakota, to just over 70% in Oregon and Texas, the national occupancy rate in 2002 is 82.45%. This is down from 83.48% in 1998. The overall occupancy rate for nursing homes has never exceeded 85% in the years from 1995 to the present.

In almost every area of the OSCAR database, there are dramatic variations state to state. This is not surprising, since nursing homes are licensed and regulated by the states. It also means that one should be careful in attempting to compare nursing homes across state lines.

The data presented in the Nursing Home Statistical Yearbook 2002 help clarify some trends that people have seen in long term care. In other cases, the hard numbers help to discredit ideas or predictions about long term care that have not been borne out by reality. In either case, the book provides an interesting glimpse into a complex area of the long term care continuum.


Patty Munday is a government relations consultant specializing in long term care issues. She has served as Director of Government Relations for the Hillhaven Corporation, GE Capital Assurance LTC Division, and the American Health Care Association. Prior to these positions, she worked for the Long Term Care Unit of the Department of Social and Health Services in Washington State, determining eligibility for nursing home placement. She can be reached at: Cowles Research Group, 301-990-1986 or