As New Englanders age, the number of nursing homes declines

As New England’s population ages, the number of nursing homes in the region is declining rapidly, and it’s having its impact on the economy.

More of the region’s elderly are “aging in place,” with state programs and family members often providing care, according to the Boston Federal Reserve’s report on nursing home closures that was released today.

The New England states with the largest percentage of over 75 residents are Maine (9.2 percent), Vermont (8.7 percent), and New Hampshire (8 percent) Rhode Island’s over 75 population increased from 7.4 percent in 2011 to 7.8 percent in 2022.

From 2010 to 2023, the number of nursing homes decreased by 15 percent in New England, while the patient count declined by 23 percent. In Rhode Island, the patient count decreased by 16 percent from 8,027 in 2010 to 6,738 in 2023.

According to the Federal Reserve there are more than 200,000 nursing home workers across New England. The loss of some of those jobs, plus the number of family members who provide homecare and what the Federal Reserve calls “foregone wages,” has a significant impact on the economy.

Those findings are supported by various studies that put the estimated economic impact of family caregivers across the country in the hundreds of billions of dollars annually. The AARP puts that number at $600 million.

In New England, and the US, the Boston Fed says the population is “aging rapidly – ​​both median age and the share of the population aged 85 and older … this group of older adults is the segment of the population most likely to require long term care.”

“In the United States and New England, the 85-and-older cohort is the fastest growing segment of the population,” the Fed says. “This group is also the most likely to rely on long-term care options, including nursing homes, The economic implications of an aging population ranges from reduced labor force productivity to increased spending on entitlement programs, including those supporting long-term care.”

According to the AARP, by 2034 adults 65 and older will outnumber children under the age of 18. In the most recent RI Kids Count report, the 18 and under population decreased 6.3 percent from 2010 to 2020, while the overall population increased slightly. In Newport, the 18 and under population decreased during that period by 10.4 percent, Middletown by 4.5 percent, Portsmouth by 13.8 percent.

Here are some of the other findings and observations in the Boston Federal Reserve’s nursing home report:

  • The New England region has seen a net loss of 150 nursing homes since 2010, with Maine, the state with the oldest population, experiencing the largest decline, 19 percent.
  • “Compared with a decade ago, New England has more older residents and fewer facilities to provide care.”
  • The Fed refers to caregivers as providing informal care, which it says can come at a cost. “Providing informal care may prevent prime-age workers from participating fully in the labor market.”
  • Medicaid, Medicare, private insurance, veterans’ benefits and out of pocket expenditures fund long-term care (LTC). Medicate typically covers only short-term stays in LTC facilities, Medicaid becomes available once an individual exhausts their personal savings, and about 3 to 4 percent of Americans over 50 have LTC insurance policies.
  • In 2023 in New England, low reimbursement rates from Medicaid and Medicare and high operating costs resulted in most nursing homes in the region losing money.