Texas Health Care Briefing No. 10
December 2018 / January 2019
Largest Nursing Home Provider in Texas Files for Bankruptcy
On December 4, 2018, the largest nursing home provider in the state filed for bankruptcy, citing its inability to cover the costs of operating its Texas facilities. The announcement was the latest signal that the state’s chronic underfunding of long term care has pushed Texas nursing homes to the brink.
The impact of the announcement will be felt across the state, with 89 facilities currently caring for more than 10,000 patients and employing over 11,000 employees. Long term care leaders expressed concern over the development, citing the fact that jobs may be lost, local economies will be impacted, and most importantly, senior Texans and their families will be affected by the uncertainty and anxiety this creates.
“There could not be a clearer warning signal about the seriousness of the state’s nursing home funding crisis than the bankruptcy filing by Senior Care Centers. The long term care funding issue has reached a crisis level, and the timing could not be worse,” said Kevin Warren, CEO and president of the Texas Health Care Association.
Seventy-five percent of Texas nursing homes report the state’s reimbursement does not cover the cost of care. Nursing home providers continue to plead their case that funding challenges are making it difficult for nursing homes to compete in the job market, upgrade facilities, and make investments in people and programs to improve care.
Warren added, “We know that other nursing homes are struggling. We’ve already seen other nursing home companies leave Texas, and others are waiting to see if relief will come this upcoming legislative session before making future business decisions.”
In April of 2018, Genesis, one of the largest nursing home operators in the country, announced it was leaving Texas. The state’s low funding for the Medicaid long term care program hastened the company’s exit. They were the second major national nursing home company to exit Texas.