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New Avalere Analysis Finds Profit Margins for Freestanding Skilled Nursing Facilities in Pennsylvania Decreased Almost 30 Percent between 2007 and 2014

Summary

According to a new analysis by Avalere, total profit margins for freestanding skilled nursing facilities (SNFs) in Pennsylvania decreased 28 percent between fiscal years (FY) 2007 and 2014, from 3.2 percent to 2.3 percent.

Researchers examined publicly available Medicare cost reports submitted annually to the Centers for Medicare & Medicaid Services (CMS).

Other key findings:

  • In general, SNFs with higher Medicaid occupancy rates have lower total profit margins.
  • In 2014, while the overall average margin for all SNFs analyzed was 2.3 percent, the margin for those facilities with 75 percent or higher Medicaid occupancy was only 1.2 percent.
  • During 2014, the average Medicaid occupancy statewide was 65 percent, and for the facilities above that average the overall margin was 1.8 percent.

The full analysis is available here.

The Pennsylvania Health Care Association (PHCA) provided funding for this analysis. Avalere maintained full editorial control.

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