Nursing Home Industry Profit Report Issued
Albany, January 25, 1999 – The New York State Health Department today released 1997 financial data on nursing homes in New York State. The combined financial figures indicate that both proprietary homes and voluntary facilities realized significant profits/surpluses during calendar year 1997.
The report, which is issued annually, is based upon financial statement submissions filed with the Department by the facilities themselves. It revealed that 289 proprietary homes, which are
for–profit corporations, recognized net profits totaling $258 million, an increase of about $39 million from the previous year. It also showed that owners of 218 of those homes withdrew $202 million in equity during 1997.
Not–for–profit homes or voluntary nursing homes, of which 233 reported, show a surplus rather than a profit because they are not–for–profit entities. Those homes generated an overall surplus totaling $163 million, an increase of more than $63 million from 1996.
Included in the voluntary homes' surplus is approximately $81 million in non–operating revenue – income resulting from contributions or investments. This calculates to be approximately 2.4 percent of gross revenue for the 233 homes reporting.
In addition to proprietary and voluntary homes, a total of 30 public nursing homes – those sponsored by local governments – reported a surplus in 1997, while 13 incurred deficits. This resulted in a $79 million net gain. That gain is significantly above the $28 million gain realized last year. Localities that sponsor public nursing homes provided $14.5 million in tax levy support during 1997, compared to $18.7 million in 1996.
The Health Department's annual financial report on nursing homes offers numerous fiscal details about residential health care facilities in New York State, including net income/loss, equity withdrawal and owners' salaries. These salaries often involve payment to more than one individual.
During 1997, owners of proprietary nursing homes received salaries totaling more than $41 million.
There are 590 licensed, free–standing nursing homes in New York State. Not all facilities reported financial data to the Department of Health in time to be included in this report.