Uniting Healthcare and Community to Support an Aging Society

The US population is aging. Nearly all baby boomers have reached retirement age, which means that by 2030, one in five Americans will be eligible for Medicare.¹

What does this mean for our communities?

The organizations that serve older Americans — hospitals, nursing homes, assisted living facilities, home health agencies, hospice and palliative care providers, rehabilitation centers, geriatric clinics, senior centers, senior housing programs, and others — are facing an uncertain future. Recent Medicaid and Medicare rollbacks under the One Big Beautiful Bill Act (OBBBA) have significantly reduced reimbursement rates, putting many providers under financial strain. Can their current business models sustain the budget cuts? Will they be able to provide quality services for the community? And what is the acceptable balance between quality of care and margin management in an industry under severe economic pressure?

We understand these pressures can feel overwhelming. But even in this challenging environment, we believe that our community holds the keys to survival. In this article, we’ll explore:

How provider shortages could affect elder care
How to plan for recent changes to reimbursement models
How providers and supporting businesses can collaborate to address these shortfalls strategically

The Status Quo: What We’re Up Against

Few sectors have felt the effects of a rapidly aging population as acutely as the healthcare industry.

Older adults require more frequent and complex medical care. Beyond managing chronic conditions that come with getting older, many face the challenges of social isolation, which — as the Journal of American Medical Association puts it — is linked to both mental and physical deterioration.² Cost escalation as a result of demand for qualified elder services well in excess of availability combined with a shortage of physicians³ and other care workers⁴, creates an uncertain and investment adverse environment.

Let’s look at the skilled nursing shortage to truly understand the industry’s challenges:

Since 2022, more than 138,000 nurses have left the workforce, and 40% of those surveyed plan to leave within the next five years.⁵ Nursing homes are particularly hurting. In 2024, the American Health Care Association (AHCA) surveyed over 400 nursing homes and determined that two-thirds of respondents were concerned that workforce shortages would force them to close their doors.⁶ This is especially concerning with the knowledge that more than half of individuals who are age 65 today will need some level of long-term care assistance later in life.⁷

So, what happens when access to skilled nursing becomes scarce?

The answer is that private funds become much more valuable.

Individuals with the means to pay for high quality of care — for themselves or their loved ones — will be the ones who receive it. They’ll find beds, consistent staffing, and attentive service. But for individuals and families without the resources to pay privately, options will dwindle. Facilities with limited capacity will prioritize private-pay patients, and those relying on Medicare or Medicaid will be left in the lurch. They’ll face longer wait times, reduced quality of care, or potentially lose access to skilled nursing altogether.

This widening of the care gap could effectively create a two-tiered elder care system, where those with money will receive care, and those without will be left to fend for themselves. The question we have to ask ourselves is this: how can we ensure all aging adults — not just those with money — get the care that they need and deserve?

Planning for Changes to Reimbursement Models

Healthcare and elder are agencies can only work within the systems they find themselves in. The budget cuts in the One Big Beautiful Bill Act (OBBBA) have ensured that these organizations are going to receive even smaller reimbursements from Medicare and Medicaid than they have in the past.

There are a few potential solutions to this problem.

First, as we discussed in a prior article, organizations should ensure they’re billing appropriately and efficiently, tracking the right metrics to support higher reimbursement rates, and educating the community on how to access to the best possible care.

But there’s more that can be done.

Organizations, nonprofits, and for-profit businesses in the industry, can strengthen their impact through collaboration. Identification of your core competences and identifying healthcare providers in your geographic region that either complement or enhance your skill set is valuable. Next, building connections with these providers and developing a strategy to collaborate or improve on best practices is effort that we believe will pay dividends. Sharing resources, coordinating care transitions, and aligning around common goals can help reduce costs and improve outcomes for those who rely on us most.

As you connect with other entities, look critically at structures that are either not key areas of your mission or are creating losses that are not sustainable over the mid to long-term. While these activities may be important, unsustainable losses may jeopardize your entity’s future. Society and therefore the healthcare services industry is changing, which might require entities to change in ways that hadn’t been considered yet. For example, small community hospital, may note an increase in (unreimbursed) long-term patients. Adding a long-term care unit to their facility may alleviate cost pressures, employee attrition, and serve its constituency better. Or a nursing home, may not have explored how community based organizations can alleviate some of the care burdens. These are simple examples, but these small collaborations can fill critical gaps in care and reduce costs so that your organization is financially sustainable.

Healthcare providers are already utilizing artificial intelligence in areas central to billing and collection, such as:

Automated Claims Processing for Multi-Level Care
Error Detection, Denial Management, and Appeals Automation
Revenue Cycle Forecasting and Predictive Analytics for Collections
Family and Power of Attorney Communication Tools
Patient Engagement and Communication
Center for Medicare & Medicaid Services (CMS) and State Regulation
Compliance and Audit Readiness

Further, many industries maintain good working relationships with their political representation at the local, state, and federal level. Make sure your voice is heard and your representatives are aware of the challenges and impacts of new and existing legislation.

Further, identify and join industry associations that are able to educate decision makers on your behalf. Developing an understanding of the industry issues and community needs with decision makers is crucial to underscore the relevance and importance of your industry.

Entities applying for federal funding are required to provide detailed accounting records and to maintain appropriate controls over compliance with federal program requirements and internal controls over financial reporting. If you are unable to meet such requirements, it may be more favorable to outsource all or parts of your accounting and finance functions.

Outlook for the Industry and How to Respond

Adapting to this new landscape will require creativity and a willingness to embrace change. And we want to help.

We work with organizations of all types across the healthcare sector, helping them optimize reimbursement strategies, strengthen finances, and ensure sound governance. But perhaps our greatest asset, especially during this time of transition, is the network we’ve built.

We believe that by working together, we can help shape a system that is not only financially sustainable, but also centered on the health and dignity of the people within our communities. If you haven’t yet connected with one of the leaders in our Healthcare Industry Group, we invite you to reach out. You don’t need to have an agenda; we simply want to listen, learn about your needs, and explore how we can support you.