Private Nursing Homes Market

Delivered August 7th, 2019. Contributors: Michael B., Daniela B., Rishavh S. and

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Private Nursing Homes Market

There are approximately 15,600 nursing homes in the US, of which 92.8% are private (either for-profit or non-profit). The five states with the largest number of nursing homes are Texas, California, Ohio, Illinois, and Pennsylvania.  

TOTAL NURSING HOMES IN THE USAccording to a 2019 CDC report, there are approximately 15,600 nursing homes in the US.
 69.3% of these, or approximately 10,810, are private, for-profit facilities.
Another 23.5%, or approximately 3,666, are private, non-profit facilities.
Only 7.2% (1,123) are government-run facilities.

STATES WITH THE MOST NURSING HOMESAccording to the Henry J Kaiser Family Foundation, the five states with the most nursing home facilities are:
Texas (1,227)
California (1,198)
Ohio (966)
Illinois (731)
Pennsylvania (693)

Note that a separate report from IQVIA published in 2018, which has slightly lower facility counts across most states, shows California in the first position with 1,200 beds and Texas just barely behind with 1,198. 

RESEARCH STRATEGYWe located a 2019 CDC report on long-term care in the US which provided the total number of nursing homes in the US along with a breakdown of facilities by region and type (profit, non-profit, etc.). While the report does not provide a breakdown of facilities by state, it is otherwise incredibly detailed and it may prove useful to read in more detail.

One important detail to bear in mind is that while this report was released in 2019, it is based on data collected in 2016. We would normally use data from previous years to extrapolate a compound annual growth rate (CAGR) and extrapolate the number for the current year, but there was insufficient information in the report to do so, and based on an almost sine wave-like pattern in the number of residential communities (Appendix 1, Table IV), we judge that further extrapolation would likely give false data. That being the case, we have simply provided the official government numbers as-is.

To find which states have the most nursing homes, we pulled a table from the Henry J Kaiser Family Foundation which provides a count of "nursing facilities" from 2017. The total count comes to 15,483, verifying that though slightly different terminology is being used, both Kaiser and the CDC have nursing care centers in mind. The slightly different total counts may stem from different methodologies and the CDC rounding their total up, though without more information about how either organization collected their data, we cannot pinpoint the exact reason. In any case, the margin of error between the two is so small that it will not affect the determination of which states have the largest number of facilities, so we have provided Kaiser's count above.

As our research into the top nursing home companies continued, we located another report from IQVIA which also provided state-by-state counts of nursing home facilities. This report was published in 2018, but given that the number of facilities is lower for most states, we suspect that it may contain older data. Since this report shows California just barely surpassing Texas, we have noted it in our findings above.

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Private Nursing Homes Market: Price and People

As of 2016, approximately 1.4 million people were living in nursing homes. The average price for private room $97,000 annually, but this figure significantly changes according to location.

People living in nursing homesA report released by the CDC in 2019 discovered that in 2016, there were approximately 15,600 nursing homes in the United States with 1.7 million licensed beds, occupied by 1.4 million patients. 
Among nursing home residents, 81.4% of short-stay residents and 85.1% of long-stay residents were aged 65 years and over. 
Among nursing home residents, 64.6% are women, 75.1% are White, 4.1% Black, 3.1% Hispanic, 11.5% Other.  
Private nursing homesAccording to the CDC, the proportion of nursing homes with for-profit ownership is 69.3%. Government nursing homes account for only 7.2% of the nursing homes in the US, and non-profit private nursing homes account for the rest. Thus, private nursing homes constitute 92.8%. 
Annual costThe average annual cost for a nursing home is $86,000 for a semi-private room and over $97,000 for a private room. There are significant variations according to the location. 
In 2017, the national median daily rate for a semi-private room was $235, a 4.44% change since 2016, with a 3.28% five-year annual growth. For a private room, the average was $267, with 5.50%, and 3.76% respectively. 
The states with the highest annual costs for a private room in a nursing home are Alaska ($330,000), Connecticut ($164,798), Hawaii ($163,885), Massachusetts ($153,300), New York ($146, 274), New Jersey ($142,530), North Dakota ($140,277), New Hampshire ($133,225), Delaware ($131,400) and Minnesota ($122,260). 
 25% pay for nursing facility care out of their own pockets or through private long-term care insurance. Medicaid is the main source of payment (61.8%). 

RESEARCH STRATEGYWe began by looking for publicly available information about the current number of residents in nursing homes in the US. Although we found several sources on the topic, we noticed that the majority of the sources used the same data as a reference; the 2019 CDC report. This report is the most accurate, reputable, and up-to-date source about the topic. Unfortunately, the final numbers are from 2016, even though the report came out in 2019. 

We considered doing a triangulation to provide a possible estimate of the total number of residents in 2019. However, the sheer number of facilities, plus the instability in the variation of the number of residents throughout the years lead us to conclude that such estimates may not be accurate. Therefore, the numbers provided are from this report. 

As for the number of people living in private nursing homes, the information about the precise amount of people living in private nursing homes (versus the public) doesn’t seem to be publicly available. To uncover this information, we started by searching for information about the number of people in private nursing homes. We searched the NHS, CDC, and several academic and news 

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Private Nursing Homes Market: Loneliness Factor

After an extensive search through the healthcare databases of the US government, research publications, and various websites targeting elderly population and nursing homes in the US, details about the impact of loneliness on elderly population living specifically in nursing homes, and the problems it creates for the caregivers do not appear to be available in the public domain. However, the research team was able to gather valuable insights regarding the impact of loneliness on the elderly population in general.
HELPFUL FINDINGSAccording to a study provided by the National Academy of Sciences, the elderly population with loneliness are at a higher risk of mortality.
According to a study provided by the National Social Life, seniors who feel lonely become victims of poor mental and physical health.
According to Dr. John Cacioppo, a psychologist and neuroscientist at the University of Chicago, perceived loneliness among the elderly population leads to cognitive decline as well as the risk of dementia.
According to various studies, seniors with loneliness are more prone to depression.
The elderly population suffering from loneliness is more prone to health risks like high blood pressure.
Caregivers of the elderly suffering from loneliness may feel less able to enjoy their personal life that leads to depression among the caregivers.
According to a study provided by the English Longitudinal Study of Aging (ELSA), seniors suffering from loneliness are more likely to report risky health behaviors including poor diet and smoking. 
Loneliness among seniors attracts numerous health risks including heart disease, obesity, and even death.
According to a study performed by NCBI, people suffering from loneliness in nursing homes are prone to strong emotions, such as grief.
 According to a study by the University of California, San Francisco (UCSF), more than 40% of seniors in America suffer from loneliness.
Loneliness in seniors increases the rate of death by almost 26%.
Lonely elders have 64% more chance of developing clinical dementia.
ADDITIONAL FINDINGS: STUDY CONDUCTED IN NURSING HOMES OF FINLAND 20% to 40% of older people suffer from loneliness.
The death rate is highest for the lonely elderly population in nursing homes.
Nursing home residents are more likely to suffer from loneliness.
RESEARCH STRATEGYWe commenced our research by first conducting a direct search for pre-compiled information on loneliness among elders living in nursing homes and the problems they create for caregivers. Following the same path, we first reviewed the healthcare databases of the US government, including NCBI and National Institute of Aging. Unfortunately, the government reports seem to be focusing on either isolation among elders in the US, Medicare spending or similar without any specific concentration over elderly living in the nursing homes. Additionally, we also searched through nursing home journals and others including The Journal of Nursing Home and A Place for Mom. Unfortunately, the majority of the information obtained as a result of this approach was either focused on the elderly population in general or were focused on the elderly population in different countries like Finland and Malaysia.

As a second approach, we looked for research publications, surveys and case studies ever conducted over the elderly population living in the nursing homes in the US. We were hoping to analyze them to get some related insights and facts to infer the impact on elderly people and consequently the problems the caregivers face. We searched through various research databases including Research Gate, Research Guide, Pew Research and others. The majority of the research reports yielded information on the elderly in Malaysia, the elderly living alone at home or similar-which were not pertinent to the client's request, hence we excluded them.

As none of the above strategies yielded any useful results, we then looked for caregivers' perceptions over the elderly population living in nursing homes in the US. We were hoping to gather common data points from interviews, websites targeting caregivers, news journals and others to answer the client's request. We searched through various sources, including ScienceDirect, StoneGate, and Aging In Place. Unfortunately, none of the information portals focused on nursing homes and provided non-relevant information regarding caregivers of the elderly at home and similar.

As a last resort, we attempted to look for articles published by nursing homes in the US to see if they may have mentioned anything regarding the struggle of different age groups, mentally or physically in nursing homes and how caregivers are playing their role specifically when it comes to the elderly population. We were hoping to synthesize the information or statistics to answer the client's question. We searched through various sources, including Care, Sava Senior Care and others. Unfortunately, none of the above sources published any relevant information pertinent enough to answer the client's question. Hence, none of the searches yielded any further results.

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Private Nursing Homes Market: Competitive Landscape (1)

Below is a brief overview of the top five private nursing care (aka nursing home) companies in the US, as determined by a count of their facilities: Genesis Healthcare Corp, HCR Manorcare, Life Care Centers of America, Sava Senior Care, and the Ensign Group. In some cases, additional details that may impact future growth have been included.

 GENESIS HEALTHCARE CORP Headquartered in Kennett Square, PA, but has facilities across the US, excepting a corridor from Texas to Minnesota, Alaska, and Hawaii.
 50,000 beds, but due to acute and short-stay cases, admits over 100,000 patients annually.
 426 facilities 

 HCR MANORCARE Headquartered in Toledo, OH, but has facilities across the Eastern United States and a lesser number in the Midwest and West Coast regions.
A reported 38,328 beds.
 239 facilities, though the number may have expanded to 281 over the past year.
Future plans include expanding to over 450 facilities across 30 states.

 LIFE CARE CENTERS OF AMERICA Headquartered in Cleveland, TN, but has locations in 28 states.
 ~29,300 beds 
 214 facilities 

 SAVA SENIOR CARE Headquartered in Atlanta, GA, but with facilities spread across the continental United States.
 23,127 beds (screenshot here, if needed) 
 201 facilities 

Sava has been at the center of numerous legal controversies in the last few years. To list a few of the more egregious issues from 2018 to 2019:

A 2018 lawsuit in California claims that six Sava facilities were involved in "patient dumping," evicting patients without proper warning and without facilitating their transference to another home.
Also in 2018, some nursing home aides in Atlanta were charged criminally for "shocking conduct" in their treatment of nursing home residents, including at least one count of murder.
In 2019, the Service Employees International Union filed a lawsuit for over $260,000 for "unpaid worker contributions" in the U.S. District Court for the District of Columbia.

THE ENSIGN GROUPHeadquartered in San Juan Capistrano, CA, with locations primarily on the West Coast and in the Midwest.
 19,615 beds 
 164 skilled nursing facilities 
Ensign pursues a strategy of mergers and acquisitions, enabling it to nearly triple the number of active beds over the last ten years.
Ensign facilities have an average rating of 4.0 out of 5 stars in CMS's Home Health Star Ratings system.

RESEARCH STRATEGYWe began our research by seeking existing marketing reports about the nursing home industry. While such reports are most often proprietary and expensive to obtain, the public abstracts often contain useful details which include lists of the top players. In this case, we were extraordinarily fortunate in being able to pull a six-page market summary from IQVIA which both the top nursing home facilities and the top nursing home chains. Upon review with the interpretation team, who noted that Golden Living had been offered as an example of the types of "nursing care centers" being sought and that the number of facilities could be used as a metric for comparison, we determined that the top nursing home chains, not individual facilities, are the true focus of this request. Even so, page 3 of our source contains a list of the largest nursing home facilities by bed count, and this may prove of interest as well.

In the course of finding the IQVIA report, we also discovered some older reports that dated to 2016 or before. Nominally, it is Wonder's practice to only use data published within the last two years to ensure that we provide only the most up-to-date information available, but the discrepancies between the reports concerned us enough to do some digging into IQVIA's methodology. According to McKnight's Long-Term Care News, IQVIA "compiled its list using the commercial reference database OneKey, which pulls information from multiple sources." Thus, the IQVIA report is not only the most recent in the public domain, but its methodology gives us a high confidence level that its results are accurate. Consequently, while we attempted to verify the most recent facility counts from the websites of the top companies themselves, where this is not possible (e.g., they do not state the number of currently-operating facilities) we will use the count of the IQVIA report.

Having established our parameters for identifying the top ten chains by the number of facilities operated, we next dug into the sites of each to locate the other requested information. Since current patient counts were not available for any chain (and conceivably changes daily), we have instead provided the number of beds. In a few cases, the companies in question have not published their total number of beds. In these cases we have pulled the data from other sources, favoring data from the Nursing Home Abuse Guide over an older report from Statista (screenshot here, if needed), but using the latter when the information is not otherwise publicly available. However, where there is disagreement in such secondary sources with our primary source, we have rounded the number of beds up or down accordingly and marked the estimate with a tilde (~).

While not strictly demanded by the project criteria, we have also provided additional information which we came across in our research and consider to be possibly salient to the company's future position, such as announced expansion plans and legal woes. We have not attempted to find additional facts about every company; only stand-out facts that were relevant in some way to the report criteria have been included.

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Private Nursing Homes Market: Competitive Landscape (2)

Below is a brief overview of the sixth through tenth largest private nursing care (aka nursing home) companies in the US, as determined by a count of their facilities: The Evangelical Lutheran Good Samaritan Society, Consulate Health Care, Signature Healthcare, Golden Living, and Trilogy Health Services. In some cases, additional details that may impact future growth have been included.

THE EVANGELICAL LUTHERAN GOOD SAMARITAN SOCIETYHeadquartered in Sioux Falls, SD, with locations primarily (but not only) in the Midwest region.
 11,258 beds (screenshot here, if needed) 
 156 facilities 
The Society is a Christian private, non-profit organization.

CONSULATE HEALTH CAREHeadquartered in Maitland, FL, with locations across the South and Northeastern regions.
 ~22,000 beds
 
 155 facilities, though another source puts the number at 202.

SIGNATURE HEALTHCAREHeadquartered in Louisville, KY, with facilities primarily in the Southeast region.
 14,190 beds (screenshot here, if needed)
 114 facilities 

GOLDEN LIVINGHeadquartered in Atlanta, GA, with locations in the Eastern United States.
By 2015, Golden Living operated 29,909 beds (screenshot here, if needed), but as explained below, the current number is likely far smaller due to a series of lawsuits.
 114 facilities, down from a peak of 302.
Golden Living was forced to transfer over 100 facilities in up to eight states, including 36 Pennsylvania facilities, to other companies as a result of a 2015 lawsuit. Consequently, the number of beds as listed in public sources is likely larger than their current count, but a more recent total is not currently publicly available.

TRILOGY HEALTH SERVICESHeadquartered in Louisville, KY, with facilities in Indiana, Ohio, and Michigan.
 Over 10,000 beds 
 103 facilities, possibly up to 109.
Trilogy puts a lot of effort into training and retaining staff; for example, their staff-funded Trilogy Foundation funded over $2 million in scholarships and grants for employees and their families.

RESEARCH STRATEGY

We began our research by seeking existing marketing reports about the nursing home industry. While such reports are most often proprietary and expensive to obtain, the public abstracts often contain useful details which include lists of the top players. In this case, we were extraordinarily fortunate in being able to pull a six-page market summary from IQVIA which both the top nursing home facilities and the top nursing home chains. Upon review with the interpretation team, who noted that Golden Living had been offered as an example of the types of "nursing care centers" being sought and that the number of facilities could be used as a metric for comparison, we determined that the top nursing home chains, not individual facilities, are the true focus of this request. Even so, page 3 of our source contains a list of the largest nursing home facilities by bed count, and this may prove of interest as well.

In the course of finding the IQVIA report, we also discovered some older reports that dated to 2016 or before. Nominally, it is Wonder's practice to only use data published within the last two years to ensure that we provide only the most up-to-date information available, but the discrepancies between the reports concerned us enough to do some digging into IQVIA's methodology. According to McKnight's Long-Term Care News, IQVIA "compiled its list using the commercial reference database OneKey, which pulls information from multiple sources." Thus, the IQVIA report is not only the most recent in the public domain, but its methodology gives us a high confidence level that its results are accurate. Consequently, while we attempted to verify the most recent facility counts from the websites of the top companies themselves, where this is not possible (e.g., they do not state the number of currently-operating facilities) we will use the count of the IQVIA report.

Having established our parameters for identifying the top ten chains by the number of facilities operated, we next dug into the sites of each to locate the other requested information. Since current patient counts were not available for any chain (and conceivably changes daily), we have instead provided the number of beds. In a few cases, the companies in question have not published their total number of beds. In these cases we have pulled the data from other sources, favoring data from the Nursing Home Abuse Guide over an older report from Statista (screenshot here, if needed), but using the latter when the information is not otherwise publicly available. However, where there is disagreement in such secondary sources with our primary source, we have rounded the number of beds up or down accordingly and marked the estimate with a tilde (~).

While not strictly demanded by the project criteria, we have also provided additional information which we came across in our research and consider to be possibly salient to the company's future position, such as announced expansion plans and legal woes. We have not attempted to find additional facts about every company; only stand-out facts that were relevant in some way to the report criteria have been included.