75% of Aging Services Providers Need More Relief Funds

Regulation | March 31, 2021 | by Nicole Fallon

In a recent LeadingAge Provider Relief Fund (PRF) survey, 75% of not-for-profit aging service provider respondents indicated that when they add up all they have received through PRF and all other COVID-19 funds, they still need more PRF to weather the ongoing expenses and reduced revenues resulting from battling COVID-19 and 17% of those said they would be forced to close or sell, if no additional funds were forthcoming.

The range of need among the not-for-profit providers varies from as little as $10,000 for an adult day services program to as much as $20 million for a full continuum aging services provider delivering services in multiple states. And yet, if the adult day service program closes because it doesn’t receive funds, it may impact fewer people but the effect will still be profound for those families struggling to care for their loved ones with dementia, while trying to hold down a job. Equally important is to help sustain the multi-state aging services provider who serves thousands of older adults and supports their families. The survey results highlight that the breadth of impact varies by provider size and type, whether they were allowed to be open or required to be closed, from state to state and regions within states. While some providers need more, 16.8% of respondents indicated that they have received sufficient funds, and a handful of providers may have received more than they can spend by June 30, 2021. For this reason, we believe future allocations should be based upon demonstrated need.

The U.S. Department of Health and Human Services has roughly $24B remaining in the PRF pot for all health care providers and $8.5B designated for rural providers. HHS recently distributed a similar amount in Phase 3 PRF funding to roughly 35,000 providers to cover their losses for the first half of 2020. Many providers were hardest hit by COVID-19 at the end of 2020 and in early 2021. These financial impacts have not yet been addressed and while vaccinations in aging service settings are providing hope that the end of the pandemic is near, it is not over yet and it will take time for service levels to return to pre-COVID-19 levels. If we don’t help providers survive financially, there will be fewer providers to meet the needs of the aging population which is expected to grow to 25% of the population by 2040. We can’t build back better if we lose providers leaving no system to build upon. Like most things, it can be expected to cost more to establish a new provider than shore up the foundation of an existing one.

The reasons more money is needed is really basic math. Providers indicate they have less money coming in at the same time as they continue to have extraordinary COVID-19 costs. Reduced service levels for in-home care (4.3%) and residential care with 87.5% citing significantly lower occupancy levels due to reduced and/or limited admissions to nursing homes (87.5%) or 73.6% noting reduced  move-ins to assisted living and life plan communities. Simultaneously they are being hit with increased costs for personal protective equipment (50%), regular COVID-19 testing of residents and staff (32.6%), staffing costs including hazard pay and agency staff (25+%), and increased insurance costs (21.5%). One provider noted, “It costs us $1.74 each time we go into a residents room in full PPE, including mask, gown, gloves and faceshield.”

LeadingAge will continue to advocate to the Administration for the urgent need to distribute the remaining $24B in PRF, and ask Congress to apropriate more to PRF to help sustain access to services through the pandemic.  

The LeadingAge Provider Relief Fund Survey was conducted between March 19-30, 2021 and received responses from 164 aging service provider organizations.