Federal COVID-19 stimulus funding has been crucial to the stability of Diversicare Health Services’ operations, according to Jay McKnight, the firm’s president and CEO.
Brentwood, TN-based Diversicare reported Thursday that it received $9.6 million of federal stimulus during the third quarter and another $6.6 million of state Medicaid add-ons. On the flip side, it incurred $12.7 million in additional COVID-related expenses for staffing, testing and personal protective equipment during the quarter.
Diversicare reported a drop in patient revenue for the quarter, to $118 million, compared to $118.6 recorded in the same period last year. Total occupancy for available beds also slipped from 81.6% to 70.2%, while skilled mix increased from 13.3% to 16.5% from 2019 to 2020. It also saw a 14% decrease in patients served from 2019 to 2020.
The company ended the quarter with a net income of $3.2 million, or 48 cents per share. Last year, it reported a net loss of $1.9 million, or 30 cents per share, in the third quarter.
“The stimulus money has enabled us to absorb these extra expenses at a time when patient-served census is decreased materially,” McKnight said during the company’s third-quarter earnings call Thursday.
“The federal stimulus money that we have received, which has been significant for us, is the primary support that our industry is relying on to survive this pandemic,” he added.
Each of Diversicare’s 62 nursing centers have either dealt with or are currently dealing with COVID-19, McKnight added.
“Meaning that we have had patients, residents and team members test positive for the virus. Roughly half of our centers have recovered and have no suspected cases as of [Thursday],” he said.
About 2,000 of its patients and residents and 1,700 workers have tested positive, with between 50% and 60% of both groups being asymptotic, “which highlights the importance of testing in the long-term care setting,” McKnight said.
New therapy partnership
Diversicare earlier this week also announced its new partnership with therapy services provider Reliant Rehabilitation. The deal was effective Sunday.
McKnight said the partnership will help keep Diversicare on the “cutting edge of innovation in our processes and will provide the best care for our patients and residents.”
He added that the company also expects “significant cost-savings from the partnership” through gained efficiencies from its centers.
“This is an exciting transition for us,” McKnight said.
This story has been updated.
