As the skilled nursing facility (SNF) sector grapples with a shrinking supply of beds and an influx of new buyers, Greystone Managing Director David Young weighs in on what’s truly fueling today’s "scarcity premium" in valuations. While closures and limited development contribute to the tight market, Young points to substantial Medicaid rate increases in several states as the primary catalyst. “The reason people are bidding up nursing home valuations per bed is largely because in the last two years you’ve seen a lot of states support their Medicaid programs in a big way,” he told Skilled Nursing News, likening the flurry of investor activity to “dropping meat in a pool of piranhas.”
Young also offered perspective on the policy risks ahead, particularly in light of the recently passed One Big, Beautiful Bill Act. With federal support for Medicaid under scrutiny, Young cautioned that market optimism could shift if reimbursement structures change. “Hopefully it’s a neutral outcome for reimbursement and then for nursing home margins,” he said, acknowledging that closures may continue at their current pace. For a deeper dive into the financial forces reshaping the SNF landscape, read the full article on Skilled Nursing News.