Growing Workforce Shortages in Long-Term Care Driving Up Costs and Delaying Care

As the U.S. population ages, the demand for long-term care services increases. However, the workforce that provides these services is shrinking. This leads to growing workforce shortages in nursing homes, assisted living, and in-home care.

In August, the American Health Care Association and National Center for Assisted Living reported that the pandemic has severely impacted the long-term care workforce. Since 2020, 579 nursing homes have shuttered across the U.S., affecting over 21,000 patients. In contrast, just three new nursing homes have been established this year, down from an annual average of 64 from 2020 to 2022.

The study further revealed that 24% of these facilities have had to close sections due to labor shortages. During the COVID-19 virus crisis, the industry lost approximately 250,000 workers or 15% of its workforce. Experts predict staffing won't return to pre-pandemic levels until 2026.

Data on workforce shortages in long-term care from the Kaiser Family Foundation shows that the number of job openings in long-term care is expected to grow to over 1.5 million by 2025.

Biden Administration Proposes Staffing Mandate for Nursing Homes

Meanwhile, the Biden administration has proposed a new staffing mandate for nursing homes, requiring facilities to have a minimum number of staff on duty at all times. The mandate is designed to improve the quality of care in nursing homes and reduce the risk of neglect and abuse.

Under the proposed mandate, nursing homes would be required to have at least one registered nurse on duty at all times and at least one certified nursing assistant (CNA) for every eight residents. The mandate would also require nursing homes to have a specific number of staff on duty during meals, bathing, and other activities.

The proposed mandate is still in the early stages of development, and it is unclear when it will go into effect. However, the Biden administration has said that it is committed to improving the quality of care in nursing homes, and the staffing mandate is one way to achieve that goal.

The proposed mandate has been met with mixed reactions from the nursing home industry. Some nursing home operators support the mandate, arguing that it will help to improve the quality of care and reduce the risk of neglect and abuse. Others oppose the mandate, claiming it will be too costly and difficult to implement.

The American Health Care Association (AHCA) says seeing the Biden Administration moving forward with the proposed federal staffing mandate is unfathomable. The AHCA says the decision is especially surprising considering that, just recently, a CMS study revealed no specific staffing level ensures quality care.

At the very same time, nursing homes are facing the worst labor shortage in our sector's history, and seniors' access to care is under threat. This unfunded mandate, which will cost billions of dollars each year, will worsen this growing crisis. We hope to convince the administration to never finalize this rule as it is unfounded, unfunded, and unrealistic. We will vigorously defend access to care for our nation's seniors and advocate for common sense solutions to improve quality and strengthen the long-term care workforce.

U.S. Senator Jon Tester (D-MT) says amid staffing shortages in rural states like Montana, the Biden Administration's decision to enforce a blanket staffing mandate could further strain rural nursing homes.

This is just the latest example of Washington bureaucrats displaying how little they understand about the challenges rural America faces, and I'll continue to fight back against burdensome mandates that simply do not work for communities across Montana.

Why the Worker Shortages?

There are several factors contributing to the workforce shortages in long-term care. One aspect is that the number of people entering the workforce is declining at a time when more people need long-term care services either at home or in a facility. Another factor is that the long-term care workforce is aging. Plus, many long-term care workers are leaving the workforce due to low pay, high stress, and inadequate staffing levels.

Negative Consequences of Workforce Shortages

These shortages tremendously impact the cost and quality of long-term care services. In-home providers and long-term care facilities are having to raise their prices to increase wages to attract and retain workers. This makes it more difficult for families to afford long-term care for their loved ones. There are many people who failed to get Long-Term Care Insurance, so they must pay for care from income and assets.

Another consequence of the workforce shortages is that it is delaying care for some people. Long-term care facilities are having to turn away some people because they do not have enough staff. And even for people who are able to get into a long-term care facility, they may have to wait longer for care.

Facing a growing demand for in-home care, many home health agencies grapple with a shortage of caregivers. Daryl Beckles, Director of Talent Acquisition at Amada Senior Care, a leading national home health agency, notes that more than half of such agencies routinely decline cases due to these shortages. Yet, some agencies have managed to sustain their staffing levels to meet the increasing need for quality care services.

According to the 2023 Home Care Pulse Benchmarking Survey, the majority of home care agencies, 54% reported that they consistently turn down cases because of caregiver shortages.

Beckles indicates that while Amada has faced caregiver shortages previously, these labor gaps haven't impacted its capacity to deliver quality care to those in need.

The number of caregivers hired throughout our organization has increased by 15.6% from 2022 which is incredible in the current environment of staffing. Because we keep our finger on the pulse of the increased demand for care being provided in the home and the number of caregivers needed to provide that care and continuously work on strategies that will help our Franchise Partners meet those needs.

Beckles asserts that superior home health agencies prioritize strategies to retain top-quality caregivers.

We know that caregivers want to feel confident and competent in providing care to their clients, they want opportunities to grow their careers, and they want to feel appreciated by the company they work for.

He notes that Amada has committed to providing the tools that caregivers need to succeed in their roles. He says that the leading home health agencies are doing everything they can to keep up with the growing demand for long-term care services.

We remain confident that we will see increased caregiver hires as well as increased retention through the remainder of the year and beyond.

Quality Care Impacted

The workforce shortages in long-term care are also hurting the quality of care. When facilities are short-staffed, workers may have to work longer hours and take on more responsibilities, leading to burnout and decreased quality of care. There are some home health agencies forced to hire less experienced caregivers. Quality care is the number one concern for most families.

Dr. Bill Thomas, founder of The Eden Alternative and The Green House Project, says that quality long-term care is about meeting older adults' physical and medical needs and honoring their dignity, preferences, and choices.

By providing person-centered care that respects the individuality and autonomy of each person, we can enhance their well-being and happiness. Quality long-term care is a human right, and a social responsibility.

Several things can be done to address the workforce shortages in long-term care. One thing is to increase pay for long-term care workers and provide better training and support. However, the cost of care will continue to grow.

LTC Costs are Exploding

The skyrocketing cost of long-term care services in the U.S. has become a significant concern for many families and individuals planning for their future. With an aging population and the increasing prevalence of chronic illnesses, the demand for long-term care services — ranging from home health aides to assisted living facilities and skilled nursing homes — has surged. While labor issues have impacted these costs, costs were already exploding due to increasing demand for care services. 

However, the financial realities of accessing these services paint a worrisome picture for those without proper planning or Long-Term Care Insurance. Often, many families find themselves in a crisis because the proper planning was not done decades prior.

A key characteristic of long-term care costs is their variance from one location to another. Across the nation, the price tag associated with these services can differ dramatically, depending largely on regional economic conditions, the availability of care providers, and local regulations. For instance, a private room in a nursing home or an assisted living facility might cost significantly more in urban areas like New York City or San Francisco than in rural parts of the Midwest or the South.

Several studies and annual surveys highlight these disparities. Such variations can make long-term care planning challenging, especially for those who might consider relocating in their later years.

The LTC NEWS Cost of Care Calculator shows you the current and projected future cost of care services nationwide.

• LTC NEWS Cost of Care Calculator - Find Your Location

These soaring and unpredictable costs underscore the importance of early and comprehensive financial planning. Individuals need to be aware of the national average and local rates when budgeting for potential long-term care needs. Long-Term Care Insurance, while an additional expense in the short term, can provide invaluable relief and financial protection against these unpredictable and rising costs. 

Keep in mind that the issue of long-term care is not just a cash flow problem; it is a family problem. Planning helps address the costs and burdens of long-term care on both your family and finances. 

Being proactive in understanding and preparing for these expenses can ensure that individuals and their families can access the care they need without jeopardizing their financial security. Most people obtain coverage in their 40s and 50s. However, affordable coverage can be obtained in your 60s and even 70s, depending on your health.