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Access to Capital in the Nursing Home Industry: A Resource on the Role of Policy and Implications for the Future

THE issue

The COVID-19 pandemic reminded policymakers of the weaknesses in the United States’ long-term care system, including its workforce challenges, financing mechanisms, and dependence on nursing homes as the primary infrastructure and only guaranteed site of care for Medicaid beneficiaries who need long-term services and supports. The policy response has been to temporarily increase federal funding for Medicaid home-based care, propose mandatory staffing levels in nursing homes, and further tighten nursing home regulations.

Furthermore, policymakers and researchers are increasingly calling attention to the need for nursing home regulation that would more clearly identify the owners and operators in an industry that largely relies on public funds for revenue. Unfortunately, these proposals fail to address the root cause of problems they are trying to solve.


With support from the National Investment Center for Seniors Housing and Care (NIC) and informed by a team of advisors with deep experience in the industry, ATI Advisory researched and assessed the current state of the nursing home industry, which has been shaped by layers of policy decisions. This comprehensive work reviews the industry landscape in the context of past policy decisions, performs a “deep dive” on capital market dynamics and the role of private capital in the industry, and concludes with policy implications for future nursing home reform. 


Unless government entities seek to assume responsibility of funding the capital needs of nursing homes, policymakers need to understand where, and how, capital markets can most efficiently support this industry, starting with recognizing the crucial role private funding plays in challenging operating environments.


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