Genesis Healthcare, Inc., through its subsidiaries, operates as a post-acute care provider in the United States.
Segments
Inpatient Services segment
This segment includes the operation of skilled nursing facilities and assisted/senior living facilities.
Skilled Nursing Facilities
As of December 31, 2020, the company offered inpatient services through its network of 341 skilled nursing and assisted/senior living facilities across 24 states, consisting of 319 skilled nursing facilities and 22...
Genesis Healthcare, Inc., through its subsidiaries, operates as a post-acute care provider in the United States.
Segments
Inpatient Services segment
This segment includes the operation of skilled nursing facilities and assisted/senior living facilities.
Skilled Nursing Facilities
As of December 31, 2020, the company offered inpatient services through its network of 341 skilled nursing and assisted/senior living facilities across 24 states, consisting of 319 skilled nursing facilities and 22 stand-alone assisted/senior living facilities. Of the 341 facilities, 246 are leased, 10 are owned, 12 are managed and 73 are joint ventures.
Additionally, the company has fixed-price options to purchase the real property of 15 of its leased facilities and 43 of its joint venture facilities. Collectively, the company’s skilled nursing and assisted/senior living facilities have 40,193 licensed beds, approximately 74% of which are concentrated in the states of Connecticut, Maryland, Massachusetts, New Hampshire, New Jersey, New Mexico, Pennsylvania, and West Virginia.
For the year ended December 31, 2020, the company generated approximately 83% of its revenue from its skilled nursing facilities, with the remainder primarily being generated from its assisted/senior living facilities, rehabilitation therapy services provided to third-party facilities, and other ancillary services.
The company’s skilled nursing and assisted/senior living facilities are clustered in large urban or suburban markets. The company’s services focus primarily on the medical and physical issues facing elderly patients and are provided by the employees of its skilled nursing facilities, assisted/senior living communities, integrated and third-party rehabilitation therapy business, and other ancillary services.
The company uses interdisciplinary teams of medical professionals to provide services prescribed by physicians. These teams include registered nurses, licensed practical nurses, certified nursing assistants and other professionals who provide individualized nursing care to the company’s short-stay and long-stay patients. Majority of the company’s skilled nursing facilities are equipped to provide specialty care, such as on-site dialysis, ventilator care, cardiac and pulmonary management. The company also provides standard services to each of its skilled nursing patients, including room and board, special nutritional programs, social services, recreational activities, and related healthcare and other services.
The company’s PowerBack Rehabilitation branded facilities are designed to provide short-stay skilled nursing facilities that deliver a rehabilitation regimen in accommodations primarily designed to serve high-acuity patients. As of December 31, 2020, the company operated 10 PowerBack Rehabilitation facilities with 1,121 beds.
As of December 31, 2020, the company had administrative services agreements or management agreements with 85 unaffiliated or jointly owned skilled nursing or assisted living facility operators. The income associated with the management services provided to the third-party facility operator is included in inpatient services in the company’s segment reporting as services are performed primarily by personnel supporting the inpatient services segment. Its administrative service company provides a complement of administrative and consultative services to the company’s affiliated operators to allow them to focus on the delivery of healthcare services.
Assisted/Senior Living Facilities
The company complements its skilled nursing care business by providing assisted/senior living services at 22 stand-alone facilities with 1,704 beds and offers an additional 1,090 assisted/senior living beds within its skilled nursing facilities as of December 31, 2020.
The company’s assisted/senior living facilities provide residential accommodations, activities, meals, security, housekeeping and assistance in the activities of daily living to seniors who are independent or who require some support, but not the level of nursing care provided in a skilled nursing facility.
Rehabilitation Therapy Services segment
As of December 31, 2020, this segment provided rehabilitation therapy services, including speech-language pathology (SLP), physical therapy (PT), occupational therapy (OT), and respiratory therapy, to approximately 1,400 healthcare locations in 42 states, the District of Columbia and China, including 289 facilities operated by the company.
The company provides rehabilitation therapy services at its skilled nursing facilities and assisted/senior living facilities as part of an integrated service offering in connection with its skilled nursing care.
In addition to the company’s rehabilitation therapy services in the United States, it has a presence in China and Hong Kong with initiatives to develop a rehabilitation therapy care delivery model and other services.
Other Services segment
As of December 31, 2020, this segment provided an array of other specialty medical services, including physician services, staffing services, and other healthcare related services.
Business Strategy
The company’s core strategy is to provide superior clinical outcomes with an approach that is patient-centered and focused on lowering costs by reducing lengths of stay and improving outcomes by developing programs to prevent avoidable rehospitalizations.
The key elements of the company’s business strategy include commitment to quality care; positioning itself for success in a value-based environment; focusing on core markets by optimizing its facility portfolio; and focusing on real estate ownership and strategic partnerships.
Revenue Sources
The company derives revenue primarily from various programs, such as Medicaid, Medicaid Managed Care, Medicare, Medicare Advantage Plans, commercial insurance payors, and private pay patients.
Medicaid
Medicaid, which is the major source of funding for skilled nursing facilities, covers patients that require standard room and board services. Medicaid is a program financed by state funds and matching federal funds administered by the states and their political subdivisions. Medicaid programs provide health benefits for qualifying individuals, and might supplement Medicare benefits for the disabled and for persons aged 65 and older meeting financial eligibility requirements. Seniors who enter skilled nursing facilities as private pay clients could become eligible for Medicaid once they have depleted their assets.
Medicaid Managed Care
Medicaid Managed Care is a health care delivery system of Medicaid health benefits and additional services through contracted arrangements between state Medicaid agencies and managed care organizations (MCOs) designed to manage cost, utilization and quality of care. The delivery of long-term care services is provided through capitated payment programs. Such programs are in place in the majority of states in which the company operates and states might implement such programs in the future if approved by the Centers for Medicare and Medicaid Services (CMS).
Medicare
Medicare is a federal program that provides healthcare benefits to individuals who are aged 65 years and older or are disabled. To achieve and maintain Medicare certification, a skilled nursing facility must sign a Medicare provider agreement and meet the CMS ‘Requirements of Participation’ on an ongoing basis, as determined in periodic facility inspections or ‘surveys’ conducted primarily by the state licensing agency in the state where the facility is located. Medicare pays for inpatient skilled nursing facility services under the prospective payment system (PPS). Medicare Part A skilled nursing facility coverage is limited to 100 days per episode of illness for those beneficiaries who require daily care following discharge from an acute care hospital.
Medicare Part A provides for inpatient services, including hospital care, skilled nursing care, hospice and home healthcare, and end-stage renal disease.
Medicare Part B provides for outpatient services, including physician services, diagnostic services, durable medical equipment, skilled therapy services, and medical supplies.
Medicare Part C is a managed care option (Medicare Advantage) for beneficiaries who are entitled to Part A and enrolled in Part B and are administered by commercial health insurers that contract with Medicare or Medicaid.
Medicare Part D is a benefit that provides prescription drug benefits for both Medicare and Medicare/Medicaid dual eligible patients.
Medicare Advantage Plans
Medicare Advantage Plans, sometimes called Medicare Part C (MA Plans), are offered by private companies that are approved by CMS. Medicare Advantage Plans cover all Medicare services and manage care of patients through a network of doctors, hospitals and other providers.
Commercial Insurance
A different type of insurance, commercial long-term care insurance, is also available to consumers.
Private and Other Payors
Private and other payors primarily consist of self-pay individuals, family members or other third parties who directly pay for the services that the company provides.
Government Regulation
The company’s provider subsidiaries are subject to federal and state laws that govern billing and reimbursement, relationships with vendors and business relationships with physicians. Such laws include, but are not limited to, the Anti-Kickback Statue, the federal False Claims Act (FCA), the Stark Law, and state corporate practice of medicine statutes.
The Health Insurance Portability and Accountability Act of 1996 (HIPAA) contains provisions that require the company to adopt and maintain business procedures designed to protect the privacy, security and integrity of patients' individual health information.
The Health Information Technology for Clinical Health Act of 2009 (HITECH Act) expanded the requirements and noncompliance penalties under HIPAA and require correspondingly compliance efforts by companies, such as the company, including self-disclosures of breaches of unsecured health information to affected patients, federal officials, and in some cases, the media.
History
Genesis Healthcare, Inc., a Delaware corporation, was founded in 2003. The company was incorporated in 2005.
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