Occupancy at nursing homes gained slightly between the second and third quarter of 2020 to 74.0 percent, but remained significantly below levels recorded in February (84.9 percent) and March (83.5 percent) when the COVID-19 pandemic began impacting the United States, according to data from NIC MAP® Data Service (NIC MAP) provided by the National Investment Center for Seniors Housing & Care (NIC).

NIC said the falloff in occupancy has been more severe in urban areas, as occupancy fell 11.8 percentage points since February versus the 8.0 percentage point decline in rural areas in that same period.

The dual factors of sharply declining occupancy coupled with the high cost of personal protective equipment, COVID-19 testing, and hazard pay for workers is placing the skilled nursing sector under unsustainable financial strain, the group said.

“Significantly lower occupancy and greater operating expenses have created unprecedented challenges for skilled nursing operators,” said Bill Kaufman, senior principal at NIC.

“They are bracing for a difficult winter, given the latest surge in COVID-19 cases and no immediate additional government intervention,” he said. “Due to COVID-19, NIC expects occupancy to remain dangerously low in the fourth quarter before vaccines become available to health care workers and skilled nursing residents.”

In the preceding months, the nursing home sector has been aided by the CARES Act and Paycheck Protection Program, which helped keep major sectors of the economy afloat during the pandemic. In addition, the Centers for Medicare & Medicaid Services waived its three-day hospital stay requirement, which extended coverage to more people impacted by COVID-19, which is evident in NIC MAP’s recent Medicare data trends.

“Many skilled nursing facilities survived the spring and summer because Congress authorized unprecedented financial aid,” said Beth Burnham Mace, NIC’s chief economist. “But as funds become exhausted and COVID-19 cases rise with little likelihood of immediate government intervention, it will be difficult for many facilities to continue sustainable operations.”

NIC said in a recent survey by the American Health Care Association, 72 percent of nursing home operators said they will not be able to maintain operations for a year under current conditions. Forty percent said they would be unable to last six months.

Data from NIC’s Skilled Nursing COVID-19 Tracker shows that nearly half of 1 percent (0.48 percent) of residents tested positive for COVID-19 at the end of September. During the week ending Nov. 1, that figure had risen sharply to just under 1 percent (0.94 percent).

Click here to access the latest NIC-provided skilled nursing data.