With 19 Nursing Homes Across Connecticut, Genesis Healthcare Warns it May Fall Victim to Costs of Pandemic


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The occupancy rate of the 19 Genesis Healthcare nursing home facilities in Connecticut dropped by 23 percent between April and June of 2020 compared with 2019, the largest decline for any state in the nation. At the same time, the hourly wage for nursing staff rose by 45 percent as facilities increasingly relied on agency labor to fill in the gaps as employees contracted COVID-19 or took time off to care for their families.

“These are astonishing figures that highlight just how wide the range of impact can be on skilled nursing facilities located in markets having high prevalence of community spread,” said Genesis Chief Executive George Hager,

As Hager put it, occupancy and labor cost are the largest factors in a nursing home’s profitability. So much so, that a change of just 1 percent can have a big impact. The impact then of 23 and 45 percent change is enormous.

In just the first three months of the COVID-19 pandemic, across their 350 locations, Genesis Healthcare lost $213 million in revenue.

“Because of our geographic density in hard hit markets coupled with what appears to be a slower and more complex recovery than expected,” Genesis Healthcare may be another casualty of the pandemic, Hager said.

More than half of all Genesis facilities are in the five hardest hit states: New York, New Jersey, Connecticut, Massachusetts and Maryland. States that were coping with the virus spread for weeks if not months before there were any recommendations on how to protect against COVID-19, said Hager, when patients testing positive were routinely sent to nursing homes.

After already receiving $228 million in aid from the federal and state governments, Hager said that Genesis would need to receive additional reimbursement to avoid bankruptcy.

According to the Centers for Medicaid and Medicare Services, a $5 billion Provider Relief Fund has been designated for Medicare-certified long-term care facilities like the Genesis Healthcare nursing homes, but when and how much aid these facilities will receive is still unclear.

In Connecticut, this dire financial situation is not unique to Genesis Healthcare.

“I can say that nursing home occupancy and the related revenue instability, is the issue that presently towers above all other nursing home issues today in Connecticut,” said Matt Barrett, president and chief executive officer of the Connecticut Association of Health Care Facilities. “Occupancy is significantly down due to the pandemic, and anticipated only to slowly recovery into 2021 and is directly linked to hospital and their recovery from the impact of the pandemic.”

Unlike nursing homes, hospitals have received additional government aid based on the number of COVID-19 patients they have treated.

“We strongly believe that skilled nursing places should get the same treatment as acute care hospitals who were given additional funds based on the number of COVID patients they cared for,” Hager said.

Genesis and other healthcare facilities have begun to make announcements about their financial situation in an attempt to pressure state and federal legislatures to grant them more aid. Without it, Hager said, sick and older populations that rely on these facilities may have no place to turn.

Whether this pressure works, however, has yet to be seen.

“Federal and state assistance, which has been the lifeline that has kept nursing homes from financial calamity thus far, will end long before hospitals and nursing homes have recovered with higher activity and census,” Barrett said. “Thus, nursing homes, which are mostly Medicare and Medicaid funded, will be dramatically short of funds needed to operate. This could be as early as October for Connecticut nursing homes. This is why operators are beginning to sound the alarms bells.”