Are You Quick Enough?

When I talk with the owners of family-based senior housing facility operators, there's not always the sense of urgency about following up on prospective residents that I see when I'm talking with the larger, regional operators of seniors housing.

Jason Oliva in his SHN article "Annual Caregiving Costs Still Cheaper than Assisted Living" writes that "For 43% of family caregivers, deciding on a senior care or senior housing option only took one month..."

For family-owned properties, one key is to make sure that every new prospective resident inquiry is contacted and pursued within minutes & hours (not days), because within 30 days, 43% of inquiries will find a new home somewhere. Being quick follow-up with prospective new residents is one of the keys to maintaining high occupancy.

,,,and maintaining high occupancy is one of the key metrics to maintaining a healthy, viable senior living community.

Health Care REIT - More Money is Better

With $1.1 billion directed into the seniors housing market and HCN's investment partnering with Main Street Development, it certainly signals an institutional change toward new construction PLUS the continuation of the consolidation of the senior living market via acquisitions.

This is Good News for Operators looking to cash out of their seniors housing investment because it means that there is money in the market to pay top-of-market prices -- especially for assets kept in good physical condition and maintaining profitability.

Big Bucks. No Wammies.

How is prescription drug use and the TV show, "Press Your Luck," similar?
("Press Your Luck" YouTube Link Here: bit.ly/1s4S3KH )

For Nursing Care Owners who are able to work with doctors and pharmacists to reduce their resident's use of prescription drugs, they may be saying the same thing as contestants on this once-popular TV show "Big Bucks. No Wammies."

Prescription drug costs are a significant cost of nursing home care. Oftentimes, each prescription's cost is not reimbursed individually. A flat amount is usually provided to the nursing home who is then charged by the pharmacy on a prescription by prescription basis.

Some patients may have 20+ prescriptions. That's "Big Bucks." If by working with resident's doctors and pharmacists, nursing homes are able to reduce the use of prescription drugs, then it may be "No Wammies" to the nursing home.

I believe that we will start to see even more attention to the use of prescription drugs throughout healthcare. The biggest impact may not only be for nursing homes who are able to successfully work to reduce their use but also, more importantly, the biggest positive impact may be in the daily lives of individual residents.

Helping people to reduce their use of potentially unnecessary prescription drugs can be another instance of "doing good is good business."

ACO Model Crashing to the Ground?

With one-third of the ACO's backing out of the program, it's looking like it's not exactly working. Excellent balanced reporting by Cassandra Dowell of Senior Housing News @srHousingNews. From the article, it looks like the ACO model may be salvaged with better metrics and accountabilities (pun intended).

From what Operators are telling me, it looks like the re-admission rate adjustments to reimbursements are having the intended, positive effect of helping residents and rewarding good outcomes for the care providers.

Let's hope that details for other programs may become equally positive.

Cassandra Dowell, SHN Reporter: http://linkd.in/1wNMrXe
Link to Story: http://bit.ly/1pcCbh7

Chris Foley
Sr. Vice President - Equity Seniors Housing Advisors
cfoley@SeniorsFamily.com
(614) 915-8835

Operations is Marketing

If you're a senior living operator and you want to keep your location 100% occupied, be the best Operator in your area and... let people know about it.

This SHN article headlined: "Dished: How Five Star is Overhauling Senior Living Dining" by Emily Study ( http://bit.ly/VyHz7i ) shows how one company is using their operations (in this case, their food service) as marketing (letting people know about what they do in a creative, memorable way).

P.S. - Look out for the 50 pound, Southern California-caught sea bass. ( http://bit.ly/VyIoND )

BTW, for the Owners & Operators:
The best way to maximize the value of a seniors living location is to run it well and re-invest back into the business through innovative & well-done business practices AND updates to the physical buildings.

Chris Foley
Sr. Vice President - Equity Seniors Housing Advisors
CPA (RETIRED)
cfoley@SeniorsFamily.com
(614) 915-8835

EB-5 Promotes Legal Migration

It looks like PDC Capital Group ( @PDCCapitalGrp ) is doing the EB-5 Program in a Big Way with $750 million investment (as reported by Jason Olivia @srhousingnews ).

The EB-5 Program, when done right, can be a great way to combine capital to create seniors housing jobs AND aid legal immigration. It's been available for years and mostly done on a much smaller scale, however, this $750 million investment certainly gives the financing technique more publicity.

Chris Foley
Sr. Vice President - Equity Seniors Housing Advisors
CPA (RETIRED)
cfoley@SeniorsFamily.com
(614) 915-8835

One of the most fascinating ideas about seniors housing over the years that I've been involved in nursing home acquisitions is how dynamic of an industry it is.

The industry and the owners & operators who choose to provide care have weathered over-building in the 1990's, multiple funding source overhauls, the introduction of electronic medical records and more regimented oversight while serving an increasingly sicker resident.

Thirty years ago, nursing homes cared for what today is considered "assisted living" residents as well as bed-bound residents. In today's higher acuity nursing homes, a high percentage of the residents are unable to walk on their own.

Challenges abound. Yet, for the keen operator who is ready, willing and able to stay flexible and make changes & re-investments as the market for nursing home care changes, success is achievable.

Chris Foley
Sr. Vice President - Equity Seniors Housing Advisors
CPA (RETIRED)
cfoley@SeniorsFamily.com
(614) 915-8835

ACO Model Causes Shifting Sands for Construction of Facilities

Senior Housing News' Jason Oliva (http://linkd.in/UNtzGe) writes that "In an ever-evolving healthcare landscape that demands higher care quality at lower costs, several senior living providers are engineering various strategies to establish themselves as partners in Accountable Care Organizations (ACOs)."

One of these trends is to build new facilities physically close to hospitals and other ACO's. This could be a power shift in the making from community-based facilities (i.e., in communities where people live) to more centralized healthcare campus controlled by hospitals.

So, in the real estate world, this could mean that the "sands are shifting" to a health campus with medical offices, nursing homes, assisted living and possibly independent living within a centralized services. Contrast this with the trend in the last few decades of having stand-alone facilities dispersed throughout a region.

Is it time to invest in land near hospitals again?

Chris Foley
Sr. Vice President - Equity Seniors Housing Advisors
CPA (RETIRED)
(614) 915-8835
cfoley@SeniorsFamily.com

Sometimes, There's Not an Easy Solution

The SHN headline reads: "Developers See Opportunity as Old Nursing Homes Become Obsolete."

The informative story by @CassandraDowell discusses how developers are building new nursing homes because the old nursing homes dated buildings and structural designs can't compete with a new building's private bathrooms and internet & healthcare technology.

Opportunity for developers, yes. What about the owners & operators of the older nursing homes?

For family-owned nursing homes with older buildings, potential options are to a) make multi-million dollar upgrades to their existing facilities, b) build a new building themselves, c) keep operating as-is and hope for the best or d) consider whether it's time to cash-out and let somebody else make those multi-million dollar upgrades to their facility.

Chris Foley
Sr. Vice President - Equity Seniors Housing Advisors
CPA (RETIRED)
cfoley@SeniorsFamily.com
614-915-8835

Marketing Checklist for Seniors Housing Operators

Even though larger seniors housing operators like @MatherLifeWays may hire staff and have formal marketing programs, Senior Housing News writer @CassandraDowell provides a quick checklist for developing an outward-bound marketing program that can be modeled by family-owned Operators too.

Family-owned senior living operators know that they are building community too. Outward-Bound marketing will help you show it off (and bring new residents to your doorstep).

1. Café Plus Model
2. Café Without Walls
3. Neighbor-to-Neighbor
4. Telephone Topics and Online Community

Chris Foley
Sr. Vice President - Equity Seniors Housing Advisors
CPA (RETIRED)
cfoley@SeniorsFamily.com
(614) 915-8835