Nursing Home Closures

Newsweek reported on the growing crisis is unfolding in the United States as nursing homes continue to shut down at alarming rates, despite an increasing need for elder care. Since 2015, more than 800 nursing facilities have closed across the country, with the majority of states experiencing a net loss. The trend has only worsened since the COVID-19 pandemic, with at least 774 closures occurring since 2020.

These shutdowns have resulted in the elimination of over 62,000 beds and the displacement of nearly 30,000 residents.

A combination of long-standing challenges largely drives the closures. Staffing shortages remain a significant issue, as many facilities struggle to hire and retain a sufficient number of qualified workers. Rising operating expenses and low Medicaid reimbursement rates have made it financially unfeasible for many homes to stay open.

Tunneling of funds to related entities played a significant role in forcing closures. This decline in available care comes at a time when demand is growing due to the aging U.S. population. With fewer nursing homes available, especially in rural areas, many older adults are being left without access to long-term care. In 2023, only 37 new facilities opened across the entire country, and just a handful have opened so far in 2024, far below what is needed to keep up with demand.

Experts and advocates warn that if these trends continue, especially amid discussions of Medicaid cuts, the country could face a severe shortage of nursing
home care. Some propose alternative models, such as smaller home-like facilities, and increased government support to stabilize the industry. Without intervention, however, the gap between elder care needs and available resources is likely to widen.