The NC State Health Coordinating Council (SHHC) recently released the draft 2013 State Medical Facilities Plan (SMFP), which identifies all health services “needed” in the state and for which providers can apply to obtain a Certificate of Need (CON), including skilled nursing facility (SNF) beds and adult care home (ACH) beds. For providers looking to grow their business, 2013 will be slow slogging.
The draft 2013 SMFP indicates that no additional nursing facility beds will be needed in NC, and thus there will be no new beds awarded by the CON Section. For ACH providers, the news isn’t much better. The draft 2013 SMFP identifies a need for only 210 new beds statewide, but most of those are in small allocations not sufficient to support the development of a new facility. ACH beds identified as needed in 2013 are Alexander County (20 beds); Graham County (20 beds); Polk County (30 beds); Davidson County (40 beds); Hyde-Tyrell Counties (40 beds); Jones County (30 beds); and Pamlico County (30 beds).
These 2013 projections continue a trend from the past several years of very few SNF and ACH beds being available and then only in numbers sufficient for small additions to existing facilities. The notable exceptions to this trend were the 2011 SMFP, which allocated a massive 240 SNF beds for Wake County, and the 2010 SMFP, which allocated 340 ACH beds for Mecklenburg County.
Many people who watch NC demographics have wondered how a state that is poised to remain one of the fastest-growing states in the 65-and-over category can continue to project so few long term care beds year after year. But these numbers derive directly from the mathematical need computations contained in the SMFP, which have not changed materially for either SNF or ACH beds in many years.
So in the absence of a meaningful inventory of new long term care beds of any sort, providers do what they do best – look for alternatives for growth. That has translated into a fairly robust market for sales and acquisitions of existing facilities. In our practice, we see this particularly with some of the smaller, older ACH facilities that cannot compete with newer, nicer “assisted living” facilities or independent living facilities that bring in personal care and some health services via contract with other providers. So they want to sell. There’s a market for these beds, and we routinely bring together motivated sellers and buyers; help them navigate the transaction; and then assist the buyer with a change of ownership for licensure purposes, a noncompetitive CON application to relocate the beds, and then licensure and certification (for SNFs) of the new facility.
It looks like 2013 will be another year of buy, sell and trade for long term care providers.