**3.2 The structure of nursing homes**

Nursing homes in the US are aiming to provide care to those with permanent disabilities rather than to 'cure' [12]. According to the Centers for Disease Control and Prevention 2016 statistics, there are approximately 15,600 nursing homes in the US, with around 1.7 million beds and over 1.3 million residents. There are also 12,200 home health agencies, providing care in the patient's own home and serving 4.5 million patients each year. Other types of long-term care contain hospice care agencies, residential care communities, and adult day service communities, the latter two of which provide able patients assistance (**Table 2**).

The nursing home industry contains a relatively large number of nursing homes, with fees being affected by numerous factors, including consumer demand and government regulations. As a result, it is a highly competitive industry [13].

The COVID-19 pandemic may affect consumers' preferences regarding the long-term care facilities they choose. Before the substantial rise in COVID-19 cases among the general population in July 2020, nursing homes and assisted living facilities made up the majority of US COVID-19 cases, with a fatality count of more than 50,000, comprising over 43% of the total deaths in June [19]. This high death rate and the following struggle to ensure patient safety and transmission control in nursing homes may deter potential service users from selecting residential care.

<sup>2</sup> Majority of this part is from the paper I published with my student, Amber Schultz [11].


#### **Table 2.**

*Statistics about Long-Term Care Facilities in the US (2016).*

This scenario may lead to a demand shifting on the long-term care services market, from nursing homes to home care.

#### **3.3 The challenge of nursing homes**

The conduct of nursing homes relates to various external factors, which impact the behavior of long-term care providers, such as government regulations, policies, and property rights (for-profit or not-for-profit). And not all patients were always treated and cared for equally.

Throughout the pandemic, all residential care facilities were following the same government COVID-19 regulations and protocols to the best of their ability, such as maintaining social distancing rules in a public area, separating and quarantining COVID-19 patients, emphasizing strict facial mask rules, etc [14]. All the regulations and rules caused another layer of the financial burden for most residential care facilities. Some small facilities, or those that lack strong financial support, may struggle to implement these changes, and therefore must face tough competition from other nursing homes with greater financial means, as well as from other substitutes for long-term care.

To assess the overall performance of the long-term care industry, several measures are usually examined, including expenditure on long-term care, private insurance for long-term care, the price of nursing home care, and the relative use of nursing homes, home healthcare, and hospice services [13]. Long-term care facility costs comprise the largest share of annual direct spending by those receiving Medicare beneficiaries as a result of age (>65 years) or disability status [15]. Longterm care expenses, such as nursing homes and assisted living facilities, are the number one category for out-of-pocket payment, followed by home healthcare [16]. In 2020, nursing homes cost an averagely of \$6,844 monthly, or \$82,128 per year, which is higher than the median household income in the US. Given the scale of the financial costs, the additional risk of COVID- 19 infection, and the restrictions on visiting could turn potential consumers away from all this type of long-term care, especially with inexpensive other forms of care. For example, home healthcare costs an average of roughly \$4,000 a month [17].

Before the pandemic, nursing homes were usually the prioritized choice for elderlies, because of trustworthy performance, regarding the quality of care, group living, and partial insurance coverage [18]. However, even prior to 2020, the average annual growth in demand for home healthcare was greater than that of nursing home facilities (**Table 3**) [19]. With the additional influence of the

*Challenges and Futures of Long-Term Care Industry after COVID-19 Pandemic DOI: http://dx.doi.org/10.5772/intechopen.104316*


#### **Table 3.**

*National Health Expenditure (NHE) amounts and annual growth for nursing home and home health care.*

pandemic, it is reasonable to observe that more people will start to choose home healthcare over nursing home care as the most appropriate, safe, and affordable option for their later lives.
