Thursday, December 28, 2006

False Spring in Long-Term Care Winter

Savvy public policymakers know that funding long-term care (LTC) will be a long, cold slog.

Even if they weather the perfect storm of impending Medicare and Social Security insolvencies, Medicaid--especially its LTC component--threatens to sink the ship of state when Boomers need expensive care.

Everyone knows the scary demographics and Medicaid's frightening budget impact. No need to repeat that here.

So, given the foreboding future of an industry heavily dependent on government financing, why are long-term care providers and the capital markets that support them thriving again? After a turn-of-the-millennium slump that sent eight nursing home chains into bankruptcy, left the assisted living industry overbuilt and under-occupied, and nearly choked off capital for all sectors of seniors housing, long-term care providers and financiers are cheerful and optimistic again.

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