Bloomberg Law
Feb. 1, 2023, 10:25 AM

Rural Nursing Homes’ Staffing Shortages Elicit Calls for Help

Tony Pugh
Tony Pugh

The Newport Health Care Center is calling it quits.

The family-owned, 50-bed nursing home in rural Newport, Vt., is closing its doors in March, unable to fill numerous jobs, including 10 licensed nursing aide slots. The average age of its 43 employees is 51; and 17 have reached retirement age.

“Part of what helped me make the decision” to close “was knowing I was going to be losing those people and I saw no way to replace them,” said facility administrator Bruce Weddington. “I’ve got nobody in this building that can do what they’re doing. I can’t find somebody to mop a floor. How am I going to fill management positions?”

Weddington’s plight is not unique. The industry’s national labor shortage has hit small rural nursing homes especially hard. In Montana, at least seven rural facilities have closed since 2022. With fewer job applicants to draw from, short-staffed rural facilities are more likely to limit new admissions, which reduces their revenue. Low Medicaid payment rates, rising operating costs, and an upcoming federal requirement to beef up staffing only add to their struggles.

‘Critical Access’

To survive, they need a lifeline; a federal “critical access” designation like the government applies to faltering rural hospitals, said Mark Parkinson, president and CEO of the American Health Care Association and the National Center for Assisted Living.

Instead of the government paying hospitals based on the cost of procedures, or at daily rates, critical care hospitals “get their annual operating costs plus 1%, Parkinson said.

“It guarantees that the facilities can stay open” and “they’re not going to run a huge deficit, which they would run if they were reimbursed in a normal way.”

Weddington liked the idea. “I think turning us into a critical access” facility “would be an excellent way to address” its financial challenges, he said.

Katie Smith Sloan, president and CEO of LeadingAge, which represents nonprofit nursing homes and other aging services providers, was equally supportive.

“A Critical Access Nursing Home program could help to level the playing field for operators and ensure that older adults and families are not forced to travel far from home to get services or left stranded, without care,” she said in a statement to Bloomberg Law.

The current economic and labor crisis is “simply too much for some providers. They cannot keep their doors open,” her letter said.

Congressional Action Needed

The Centers for Medicare & Medicaid Services said nursing homes have specific statutory payment rules and there is no provision in the law for critical access nursing homes. Congress would have to enact legislation to create such a designation.

Parkinson said his organization hasn’t had formal talks with Congress or the CMS about a new critical access designation. They’ve been more focused on getting nursing homes through the current labor crisis, the Covid-19 pandemic, and the Biden administration’s proposed minimum staffing proposal, which is expected sometime this year.

But a survey this month of 500 facilities by the AHCA/NCAL found two-thirds were concerned about closure due to workforce shortages.

Mark Bertilrud, executive director of the nonprofit Warroad Senior Living Center in Warroad, Minn., said his facility has trouble hiring and retaining staff because a local manufacturer pays higher rates. He said a critical access designation would be a “a hugely important concept for places like us in recognizing our dependence on government payment sources.”

Recently, a bipartisan group of senators, led by Republican Conference Chairman John Barrasso of Wyoming, sent a letter to CMS Administrator Chiquita Brooks-LaSure expressing concerns about the effects of the proposed staffing requirements on rural nursing homes.

“Blanket staffing standards may not provide enough flexibility to nursing homes in light of well-known and long-standing obstacles to the recruitment and retention of direct care workers, especially in rural and underserved areas,” the letter stated. Meeting such mandates “will place nursing homes in financial jeopardy,” the letter added. “This could lead to the shuttering of facilities, especially in rural communities.”

Barrasso’s office didn’t respond to a request for comment about the possibility of legislation to expand critical access designations to nursing homes.

“We stand ready to work with your agency on proposals to improve long-term care for patients,” the senators’ letter added. “The best way to accomplish this goal is working with Congress and stakeholders to ensure any future actions do not further exacerbate the serious challenges already facing facilities in rural America.”

To contact the reporter on this story: Tony Pugh in Washington at

To contact the editors responsible for this story: Karl Hardy at; Cheryl Saenz at