Assessing Facility, Resident, and Financial Characteristics Associated With HUD 232-Sponsored Loan Participation in Nursing Homes.
Academic Article
Overview
abstract
OBJECTIVES: Many nursing homes require significant modernization to enhance resident quality of life, yet access to capital remains a critical barrier, especially for those dependent on Medicaid funding. The Housing and Urban Development (HUD) 232-sponsored loan program helps insure low-interest financing to nursing homes, but its impact on capital accessibility and quality improvement remains unclear. This study examines nursing home characteristics associated with receiving HUD 232-sponsored loans. DESIGN: Linear probability model to assess facility, resident, financial, and county-level characteristics predicting HUD 232 loan likelihood. SETTING AND PARTICIPANTS: We analyzed nursing homes from 2012 to 2021, with the HUD 232 cohort spanning 2013 to 2020, using a comprehensive data set combining HUD 232-sponsored loan data, CMS Nursing Home Compare, LTCFocus, and Medicare Cost Reports. METHODS: We used a linear probability model to evaluate the relationship between facility characteristics and the likelihood of receiving a HUD 232-sponsored loan, focusing on factors such as ownership type, financial stability, staffing levels, and resident demographics. RESULTS: Nursing homes with higher operating margins, higher proportions of Medicare residents, and in rural locations were significantly more likely to receive HUD 232-sponsored loans (P < .01). In contrast, not-for-profits were underrepresented among loan recipients (P < .01). There was no significant association between quality measures, such as overall star ratings and health deficiencies, and loan uptake. CONCLUSIONS AND IMPLICATIONS: The findings suggest that although the HUD 232-sponsored loan program improves access to capital for financially stable nursing homes, it may exclude others in need of funding, such as not-for-profits and nursing homes serving fewer Medicare residents. Policy makers should consider reforms to better align the program with its goal of supporting modernization across the entire nursing home sector, particularly for those facilities that are financially disadvantaged.
