Last month we went looking for a published number on what a skilled nursing building spends on supplies per patient day. We wanted it for the controllers we talk to, who are building next year's supply budgets and have nothing to check them against.
We wrote up what we found, and the short version is that we did not find one that covers operators as a group and says what it counts.
You would use it twice. Once at budget time, to set a department target against something other than last year plus a few percent. And once when the owner asks whether the group is high on supplies and you want an answer with a source behind it.
Neither works if the benchmark counts differently than you do. If the median counts food and your supply PPD keeps food in the dietary line, the two are different numbers, and you cannot tell by how much.
What the cost reports, the CPA surveys, and the distributors give you
The CMS cost reports are public. They come out late, after the year they describe, and the cost centers in them do not match what purchasing buys. How each building allocates its shared costs shapes what lands in each line. They were built for policy work.
Some regional accounting firms publish supply figures for their clients. The samples are small and regional, and each firm decides for itself whether food counts as supply spend.
The national distributors see purchasing data from far more buildings than any one operator runs, and they keep it to themselves. They also sell the supplies, so their number for what you should spend would not be neutral.
Why your PPD and the next operator's do not compare
Ask two controllers for last month's supply spend per patient day and you get two numbers built on different rules. One counts food as supply spend and the other keeps it in a dietary line of its own. Same with pharmacy and minor equipment. Some count them in, some do not.
The census side has the same problem. Bed-hold days are in the patient-day count at one operator and out at the next, and leave days go the same way. The same spend divided by a different patient-day count gives a different PPD, and neither controller is wrong.
The data also sits in different places. A distributor sees its own slice of your spend and nothing else. The census is in your EHR, and the spend is not. You have both, for your own buildings, and so does every other operator, for theirs.
So a usable benchmark has to state two things before it states a median. It has to say what supply spend includes, and it has to say what counts as a patient day. Without those two lines there is nothing to compare your own number with.
What the survey collects and how the report is put together
Our LTC Spend Benchmark survey asks operators for six things: supply spend per patient day, invoice processing costs, month-end close duration, duplicate-payment rates, contract compliance, and budget practices. Responses are anonymous. The report will also use anonymized aggregates from our own platform.
The rules are set before the data is in. The report will give medians and ranges, and no number that points at one operator. No group of fewer than ten operators gets a number. The report will state its definitions before any number, so you know whether food is in and whether bed-hold days were counted.
If you answer, you get the report first. It goes on the benchmark page when it is ready, and we cannot hand you the number before then.
Until then, the only benchmark you have is your own best building. It works as a target for the others that serve a similar population, once every building counts patient days the same way. It will not tell you whether that building is good by industry standards, and this report's medians will not adjust for your case mix either. The PPD budget guide covers building the baseline from twelve months of actuals.
Questions controllers ask
Does supply spend per patient day include food?
It depends on who is counting. Some operators keep food in a dietary line of its own and some fold it into supply spend, so two published figures can differ on that alone. Any benchmark you use should say which rule it followed, and you should apply the same rule to your own number before comparing.
Is there a published benchmark for supply cost per patient day in skilled nursing?
We have not found one that covers operators as a group and states what it counts. The CMS cost reports group spend by cost center rather than by what purchasing buys, and the regional accounting-firm surveys each define supply spend their own way. Our LTC Spend Benchmark survey (adelpo.com/benchmark) is collecting it from operators, and no group of fewer than ten operators gets a number.
Do bed-hold days count as patient days?
Operators split on this, and either rule works as long as you apply it to every building. Counting bed-hold days lowers the PPD on the same spend, so decide the rule once and write it next to the number.
How do you calculate supply spend per patient day?
Divide the department's supply spend for the period by the patient days for the same period, using the actual census rather than licensed beds. Do it by department, because a house-wide figure hides the department that is over.