Reality Check

Half of assisted living providers are operating at a loss, and 64% say they will not be able to sustain operations for another year, according to survey results released in August by the National Center for Assisted Living. In the poll, assisted living providers shared they are facing a financial crisis like that experienced by nursing homes as their COVID-19 response has significantly increased costs while also affecting revenue streams.

One of our students said he would be better off if minimum wage had not taken effect in July 2020 for Los Angeles County, which increased to $15.00/hour for employers with 26 or more employees and to $14.25/hour for employers with 25 or less employees (a full $1/hour increase from 2019).

Unlike nursing homes, assisted living providers have not received any direct federal funding while incurring significant cost increases for personal protective equipment, staff “hero pay,” cleaning supplies and testing. Nursing homes are also facing fines up to $8000 if employees are not tested for Covid-19. This does not yet apply to assisted living. Assisted living operators have not received federal support in the form of PPE and testing, which many providers are paying for out of pocket. Only 15% of assisted living providers received some funding from the Coronavirus Aid, Relief, and Economic Security (CARES) Act Provider Relief Fund for all Medicaid providers—of which less than half of assisted living operators are eligible. (It is possible those facilities in the Assisted Living Waiver Program could be eligible.)

Associations representing senior living and other long-term care providers have asked Congress for $100 billion to cover the COVID-19-related costs of testing, PPE, and staffing. No response yet as Congress is waiting until after the November elections.

Recently, the California Supreme Court ruled that the 1982 Long-Term Care, Health, Safety, and Security Act allowing residents to sue skilled nursing facilities does limit their compensation to $500 regardless of the total number of violations. Will its decision apply to RCFEs?

California Welfare and Institutions Code 9701 defines a long-term care facility as “any nursing or skilled nursing facility” and “any residential care facility for the elderly.” The Supreme Court decision only seems to cover skilled nursing facilities, but this decision may open the door for decreased judgments against all assisted living facilities.