In March 2020, the National Investment Center for Seniors Housing and Care (NIC) launched the Executive Survey Insights survey (ESI). The survey, now in its 28th wave, has provided a timely understanding of the impact of the COVID-19 pandemic on the seniors housing and nursing care industry and highlighted the many challenges and successes of the industry during this turbulent time.
The survey is comprehensive and provides results that support analysis of the impact of the pandemic on properties of every size, type and ownership structure, as well as across seniors housing care segments, such as skilled nursing, independent living, assisted living and memory care. Each completed questionnaire has delivered information from the perspective of an owner/operator’s entire portfolio of seniors housing and nursing care properties, providing real-time insights on hundreds of buildings and thousands of units across the country every two weeks since near the beginning of the pandemic in mid-March 2020.
Detailed reports for each “wave” of the survey and a PDF of the report charts can be found on the NIC COVID-19 Resource Center webpage under the Executive Survey Insights section.
One-year timeline of executive survey insights and the coronavirus pandemic in the United States
As shown in the timeline below, the Executive Survey Insights results have demonstrated clear trends that have corresponded with the broad incidence of COVID-19 infection cases in the U.S. across the time series from March 24, 2020 to April 1, 2021. The chart below illustrates the drastic slowdown in seniors housing and care move-ins by care segment early in the pandemic, followed by somewhat of a stabilization over the summer, and another tapering off as conditions worsened in the fall. By Wave 18, the COVID-19 vaccine had begun to be distributed across the country through the Long-Term Care Vaccination Program (in the latter half of December) and the pace of move-ins accelerated as reflected in operators’ subsequent experiences in Waves 19 through 25 (conducted December 28 to April 1, 2021). By Wave 25, the shares of organizations reporting acceleration in the pace of move-ins had grown to this time series’ highs across each of the care segments.
Uncertainty: Survey Waves 1-10 (March 24 - Aug. 2, 2020)
Early in the pandemic, the most common reason cited by operators for deceleration in move-ins was a slowdown in leads conversions/sales due to moratoriums of moving residents into communities to mitigate COVID-19 contagion within seniors housing and care properties. Ultimately, these bans on move-ins (some voluntary and some mandated by regulations) resulted in challenges backfilling vacancies. Respondents also noted at the time that they were seeing fewer hospital referrals or elective surgeries that had reliably served to bring in residents for therapy and rehabilitation stays prior to the pandemic.
Pressure: Survey Waves 11-15 (Aug. 17 - Nov. 8, 2020)
The fall surge of the coronavirus resulted in another slowdown in the pace of move-ins, and an increase in the share of organizations reporting residents waiting to move in. Presumably due to new spikes of COVID-19 cases in many areas of the country or possibly due to restrictions on family member visitations imposed by some states, more organizations in Wave 11 (late August 2020) than in all of the prior waves of the survey cited resident or family member concerns with moving a loved one into senior living. By Waves 12 and 13 (September 2020), battling the pandemic was putting a strain on operating costs. The loss of revenue associated with a decline in occupancy rates across care segments, in conjunction with rising expenses associated with staffing, PPE and testing protocols, was putting acute pressure on NOI for many operators and their capital partners.
Anticipation: Survey Waves 16-20 (Nov. 9, 2020 - Jan. 24, 2021)
Presumably as a result of better and safer visitation protocols and more acceptance, resident or family member concerns cited as a reason for acceleration in the pace of move-outs was then at the lowest level in the survey time series. Long-anticipated as a game-changer with regard to improving occupancy, many operators were starting to receive the COVID-19 vaccine. In December, the CDC prioritized skilled nursing and assisted living residents and staff members in phase 1a of the COVID-19 vaccine distribution. In Wave 20, ending January 24, 2021, four out of five organizations had finished their first clinic.
Cautious optimism: Survey Waves 21-24 (Jan. 25 - March 21, 2021)
Amid growing optimism among operators, in late January when the survey data had yet to show an upward trend in occupancy, respondents were starting to notice an increase in prospect interest specifically related to the availability of the vaccine. Positive signals became palpable in the Wave 22 (February 2021) survey results, which revealed upward shifts in organizations reporting acceleration in move-ins and occupancy increases across each of the care segments. Data compiled in NIC’s Skilled Nursing COVID-19 Tracker clearly showed that COVID-19 cases in skilled nursing communities were falling at a faster pace compared to the U.S. since the launch dates of the Pfizer and Moderna vaccines in long-term care settings, and more organizations with memory care units and/or nursing care beds reported increases in occupancy than decreases since prior to the fall surge of the coronavirus.
One year into the coronavirus crisis, the pandemic had necessitated many changes in the way seniors housing and care operators do business. In the NIC Executive Survey, respondents were asked to list one of the things that their organization plans to keep doing, stop doing, bring back and further develop. In addition to maintaining COVID-19 and infection mitigation protocols, organizations will continue leveraging virtual (and other) technologies for a variety of uses.
Turning point? Survey Waves 25-27 (March 8 – April 19, 2021)
The market fundamentals in the Executive Insights survey data through mid-April showed signals of making headway. Leads volume was up and the shares of organizations reporting accelerations in move-ins continued to trend positively, with each of the care segments reaching new high points in the survey time series. In the first quarter of 2021, on average about 50 percent of survey respondents since July 20 indicated their organization was offering rent concessions. As of Wave 26, three out of five respondents with multiple properties in their portfolios were offering rent concessions in more than half to all of their properties.
Staffing shortages that were experienced by many operators prior to and exacerbated by the pandemic persisted. Four out of five respondents indicated their organization was experiencing staffing shortages in their properties. By the end of March, nearly all respondents were paying staff overtime hours, and four out of five organizations were tapping agency/temp staff. Survey respondents described various strategies that operators were implementing to attract staff. Most organizations commented that they are offering hiring/sign-on bonuses, bonuses for employees who refer new hires and wage increases. Others are staging job fairs and recruiting events, offering flexible shifts/schedules and enhancing benefit packages.
Going forward: Survey Wave 28 (May 3 to May 16, 2021)
The Executive Insights Surveys suggests that the seniors housing and care market fundamentals may have reached a turning point at the end of March. According to survey respondents, leads volume continues to grow and the shares of organizations reporting accelerations in move-ins continues to trend positively. These leading indicators have been translating into higher occupancy rates since the Wave 25 survey, conducted in the latter half of March.
Interestingly, increased resident demand has been cited by nine out of 10 respondents as a reason for acceleration in move-ins since the Wave 25 survey. Nearly two-thirds of survey respondents expect their organizations’ occupancy rates to recover to pre-pandemic levels sometime in 2022. This sentiment has remained consistent since first reported in late February.
As vaccine optimism replaces uncertainty, the NIC Executive Insights Survey will track changes in the seniors housing and care sector with continued focus on market fundamentals, labor and staffing and other factors that affect NOI. From time to time, new questions will be asked as conditions necessitate.
NIC wishes to thank survey respondents for their valuable input and continuing support for this effort to bring clarity and create a comprehensive and honest narrative in the seniors housing and care space at a time when trends are continuing to change in our sector.
Beth Mace is chief economist and Lana Peck is senior principal with NIC.