Coronavirus could cost US senior living industry $57 billion

George Sell George Sell Uploaded 06 April 2020

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US: The US senior living sector is facing an adverse economic impact of between $40 billion and $57 billion over the next 12 months, according to new analysis.

The report, by two industry associations — Argentum and the American Seniors Housing Association (ASHA) - was sent last week to Secretary of Health and Human Services (HHS) Alex Azar. The two groups urged HHS to allocate $20 billion for senior living providers from the Public Health and Social Services Emergency Fund (PHSSEF) established through the $2 trillion CARES Act stimulus package.

Although they are spending more money on labour, supplies and technology, senior living providers have been forced to cut back on in-person tours and are beginning to see occupancy erosion and a related loss of revenue, the bodies claimed in a report on US website Senior Housing News.

The report also says that occupancy appears to have remained largely stable during the first weeks of the US Covid-19 outbreak, and well-capitalised providers have been able to absorb rising expenses so far. "But the future is uncertain, as elevated expenses can only be supported for so long, and outbreaks of Covid-19 within communities not only bring human suffering but enormous financial repercussions," it says.

Nate Underwood, co-founder and president of Nebraska-based Heritage Communities, said: "The thing that’s hard about this is not having any sense of how long it’s going to be. Right now, you’re modelling something that’s a slow decline down a hill, and you don’t know where the bottom is. That can be scary.”

“The cost of maintaining high quality of care and high quality of life for senior living communities has increased up to 73 per cent for senior living communities that remain free of Covid-19 and up to 103 per cent for Covid-19 positive senior living communities,” ASHA and Argentum stated in their letter to Azar.

 

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