Group warns of unprecedented wave of Iowa nursing home closures

A new report has found the state’s nursing homes are facing significant financial challenges — and there’s been an 11% decline in the workforce for Iowa’s senior care services since the start of the pandemic.

The report is from LeadingAge Iowa, a group that represents non-profit assisted living centers, home health care services and nursing homes. Matt Jahn is the Director of Health Services at Stonehill Communities in Dubuque, where there’s a long waiting list.

“Because of the continued staffing shortages and the reimbursement challenges to pay more competitive wages for all of our caregivers, we’re kind of at a standstill with being able to move ahead and continue to serve more Iowans that need care,” he says.

Nearly eight out of 10 Iowa nursing home managers say they’ve used temp agencies to fill staffing gaps. Julie Thorson, President and CEO of Friendship Haven in Fort Dodge, says they’re trying to hire and keep full time staff.

“We have done everything from, you know ,the basic – raise wages, of course, and then offer many bonuses,” she says, “whether it’s thank you bonuses or COVID bonuses.”

The report from LeadingAge Iowa found operating costs for providers of aging services increased 16% during the past two years. The revenue from patient care, however, rose less than half that amount. The Medicaid program pays for the care of over half of Iowa nursing home residents, but an analysis by the Iowa Health Care Association indicates Medicaid’s reimbursement rates fall about 20% short of actual costs.

If Medicaid rates aren’t raised, the report from LeadingEdge Iowa concludes there will be “an unprecedented wave” of nursing home closures.

Last year, 17 nursing homes in Iowa closed and — since the beginning of this year — five more Iowa nursing homes have announced plans to close.