The average price paid per bed for skilled nursing facilities hit a record $47,400 in 2006, according to the latest edition of The Senior Care Acquisition Report. The figure marks a nearly 10% increase over the 2005 average sale price and 50% premium over the 2003 mark.
Why so expensive? The increasing number of elderly and infirm combined with the substantial profit made from running a nursing home. “We have been seeing a changed attitude over the past year or two about the skilled nursing facility industry, and with double-digit yields still available, investors have been taking a second look at the sector,” said Stephen M. Monroe, editor of The Senior Care Acquisition Report, which is produced by Irving Levin Associates, Norwalk, CT. “Even though there are still a lot of older nursing facilities in the market, the better quality facilities with a strong Medicare census are driving the market right now.”
If demand is up and profit is up…why are many nursing homes understaffed with the explanation that there is just not enough money in the budget to hire a sufficient number of nurses and aids?