NIC MAP® Data Service clients attended a webinar in mid-July on the key seniors housing data trends during the second quarter of 2019.  Key takeaways included the following: 

Takeaway #1:  Seniors Housing Occupancy Fell to its Lowest Rate Since 2011  

• Based on the quarterly patterns of inventory and absorption, the all occupancy rate for seniors housing, which includes properties still in lease up, fell 20 basis points to 87.8% in the second quarter, its lowest level since 2011 and 2.4 percentage points below its most recent high of 90.2% in the fourth quarter of 2014.   

• Stabilized occupancy for all seniors living properties (defined by NIC as properties that have been open for at least two years or, if open for less than two years, have already reached a 95% occupancy level) was more than two full percentage points higher than total occupancy and stood at 89.9% in the second quarter, down 10 basis points from the first quarter, and down 10 basis points from year-earlier levels.  The 210-basis point difference between the total and the stabilized occupancy rates reflect the large number of properties recently opened and still in lease up. 

Takeaway #2:  Assisted Living Occupancy Slipped to 85.1%,  Its Lowest Level Ever Recorded by NIC.   

• As of the second quarter, there was a five-percentage point difference in occupancy rates, with assisted living hitting a record low of 85.1%, while independent living remained above 90% at 90.2%, unchanged from one year ago, but down 30 basis points from the first quarter. 

Takeaway #3 Assisted Living Construction Starts Trending Lower 

• The four-quarter moving sum of starts for majority assisted living continued to slow in the second quarter of 2019—AL starts totaled roughly 1,700 units, the fewest starts since the first quarter of 2014.  On a four-quarter aggregate basis, starts totaled 10,175 units, also the fewest since 2014.  As a share of inventory, this amounted to 3.5%.  For perspective, in late 2015, it was 6.5%. 
• While this may look encouraging to those concerned about the construction cycle we are currently in, it is important to note that due to the nature of this data, it is often revised either up or down. 
• For independent living, there is also a downward trend.  Starts on a rolling four-quarter basis, totaled 8,939 units in the first quarter.  As a share of inventory, this equaled 2.7%. 

Key Takeaway #4:  Several Markets Experienced Higher Occupancy Rates 

• In the second quarter, 13 markets had occupancy rates lower than year-earlier rates, while 13 had occupancy rate higher and five were unchanged.  For perspective, in the first quarter, seventeen of the thirty-one markets had occupancy rates lower than year-earlier levels, while thirteen markets had higher occupancy rates than one year ago and one was unchanged. 
• The best improvement from year-earlier levels continued to occur in San Antonio where the occupancy rate was up nearly 4.4 percentage points from year-earlier levels to 82.9%.  While this still places San Antonio as having the third lowest occupancy rate, it is a sign in the right direction.  In fact, construction as a share of inventory had reached a very high level of 21.6% in Q1 2015, so the fact that there is very little development currently underway (3.1% of its inventory or 302 units) is a good sign that further occupancy improvement will be able to occur in the coming months. 
• Eighteen markets had occupancy rates higher than the Primary Market average. Starting on the left in the chart is the market with the highest first-quarter occupancy rate: San Jose, at 95.7%, a new high for that market and up 80 basis points from a year ago.  

• At the other end of the spectrum are Houston, with an occupancy of 81.1% followed by Las Vegas (82.3%).   

Takeaway #5:  Properties 10 to 17 Years Old Have Highest Occupancy 

• Occupancy rates vary by age.  The group of properties that are between 10 and 17 years old have the highest occupancy rates.  Over the entire time frame, the average occupancy was 91.2%. 
• Since mid-2017, properties aged 2 to 10 years have had the lowest occupancy rates.  Between 2012 and 2017, they placed second after those aged 10 –17 years of age.   
• Since 2017, properties 25 years and older have done better in terms of higher occupancy rates than those aged 2 to 10 years.  In the second quarter they averaged 90.2%, better than the younger aged properties.    

Key Takeaway #6:  Seniors Housing and Nursing Care Transaction Dollar Volume Up 41% from Year-Earlier Levels  

• Preliminary data shows that seniors housing and care transactions volume registered $3.4 billion in the second quarter of 2019.  This includes $2.2 billion in seniors housing and $1.2 billion in nursing care transactions.  The total volume was the same as the previous quarter and up 41% from year-earlier levels. 

• The rolling four-quarter total seniors housing and care volume was up 6.7% from the prior quarter to $15.6 billion. 
• There was a total of 121 deals closed in the second quarter. 
• Portfolio deals decreased 16% from 32 closing in the first quarter of 2019 to 27 in the second quarter. 

Attendees at the upcoming 2019 NIC Fall Conference will benefit from some of the best networking opportunities of the year, punctuated and enhanced by a full program of informative and insightful presentations. As with all NIC events, attendees are offered a wide range of subject matter and formats, carefully designed to be relevant, useful, interesting, and thought-provoking. Attendees interested in benefitting from the innovations, investments, and lessons learned from businesses operating in real-world conditions will fill the room on Wednesday at 4PM for a unique session titled “Innovations That Work.”

Seniors housing and skilled nursing markets are constantly evolving, often driving owners and operators to look to innovation to add value and improve margins. But, while often promising, and sometimes fruitful, not every innovation yields positive business results. Those that are yielding demonstratable results that create value for residents and owners alike offer extremely valuable lessons – and inspiration – to decision-makers considering their options. Investors and owners alike will find “innovations that work” to be well worth an hour of their time, as they aim to solve the most pressing challenges and take advantage of the greatest opportunities their businesses are facing today.  

This dynamic hour-long session will focus on five separate case studies. NIC staff fielded dozens of applications from potential presenters, culling them down to the best examples of practical innovations that are working and yielding demonstrable, positive results in the marketplace today. Each presentation will cover the details of a day-to-day implementation and will include an analysis of operational and financial impact. Here is a brief overview of each of our “Innovations That Work” for 2019: 

“Boosting staff engagement to improve retention and turnover” 

Submitted by Denise Boudreu-Scott, President, Drive 

A shortage of quality staff impacts everyone. Employees can’t keep up with extra tasks when there aren’t enough hands, sometimes becoming “burned out”. Managers spend their days filling open slots instead of working strategically. Leaders struggle with increased overtime and agency costs.  

Drive is a consultancy that has helped over fifty aging services organizations improve the resident and staff experience, and the bottom-line, through more engaged leaders and employees. They look at the common threads between high performing team members and the reasons why they joined the organization in the first place. Presented by a leader from one of the properties they’ve helped, this presentation will reveal how a host of staffing metrics were improved dramatically at multiple organizations by using Drive’s approach.  

Aided by data and analysis provided with the help of an Associate Professor at Cornell, and his students, case studies provide measurable results, along with details on how staffing issues were improved at different properties. In one case, the organization discovered that 95% of its high performing staff had been referred by a friend, and then was able to use that information to attract more people and reduce 90-day turnover. Data that has been collected since this solution came to market four years ago will be shared and analyzed, reflecting real-world improvements in staff retention and turnover rates.   

“Increasing lead volumes with decision–science” 

Submitted by Nate O’Keefe, CEO, Roobrik 

Two intertwined problems are addressed by Roobrik’s multi-channel digital marketing platform: older adults and their families tend to wait for a crisis before making care decisions, and senior living providers struggle to engage with families earlier in the decision process.  

Roobrik uses decision–science based assessments to help families get “unstuck” and connected to senior living providers. Their “Is it time to get help?” and “Is it the right time for senior living?” assessments use decision–science to reach families who are still in research mode and encourage them to move forward.   

Over 350 communities have added Roobrik’s platform to their websites since it became available three years ago. Presented by an operator who has implemented Roobrik, data shows that the solution drives an immediate 20%-40% increase in online lead volumes, with each lead sharing 23 additional data points about their situation, concerns, needs, and readiness.  

“Driving down depression – and costs – with voice assistant management” 

Submitted by Erum Azeez, co-founder and CEO, Soundmind 

Residents are dealing with the challenges of aging, such as social isolation, boredom, and illness while 90% of facilities are understaffed.  

Less than two years ago, Soundmind launched a secure, HIPAA-compliant voice assistant management platform designed specifically for seniors housing. By centrally managing and customizing voice assistants in resident rooms, common areas, and staff offices, Soundmind-enhanced voice assistants are saving time, streamlining workflows, and positively impacting residents. They connect residents to their families through voice-based text messaging and photo sharing. They also provide secure access to music, news, podcasts, TV and other content. 

An operator now using Soundmind will share their experience implementing the technology – and will present data supporting the company’s claims that their clients see a 95% adoption rate, five times more usage than average consumers, and a 44% reduction in depression scores, while driving down costs and helping top- and bottom-line growth. 

“Slashing unnecessary readmissions with tech-enabled telehealth” 

Submitted by Ray George, VP, Growth and Strategy, Third Eye 

Residents sometimes need immediate medical care and attention at night and on weekends. Rushing them to the hospital is costly, inefficient, and does not always produce the best outcomes.  

Third Eye Health is the nation’s largest post-acute telehealth provider with over 200 customers utilizing their solution across 26 states — helping nursing homes to reduce hospital readmissions and provide higher acuity care.  Their tech-enabled physician telehealth service provides 24/7 and night and weekend medical care. With the company’s mobile-based solution (typically delivered via an iPad), when a patient or resident is in need of immediate medical care, with the touch of a button, the nurse can contact one of their specially trained physicians through secure video and text messaging. 

One of Third Eye’s clients will share their experience, and explain how, on average, Third Eye is seeing a 25% reduction in unnecessary hospital readmissions across its customer base- leading to improved patient care and enhanced profitability for the nursing home.

“Optimizing resident engagement” 

Submitted by Linked Senior 

In senior care today, optimizing resident engagement is not considered to be correlated with a positive return on investment. Yet, research shows that highly engaged seniors are less prone to depression and behavioral issues. Tracking residents’ changing needs and preferences, as well as assessing real-time changes involves tedious paper tasks and is often an inefficient use of staff resources.  

Established in 2007, Linked Senior provides a fully digital solution to programming and planning for over 50 properties, allowing staff more time for individualized and creative solutions.  In 2017, Linked Senior partnered with the Responsive Group in Toronto and Western Oregon University to research resident engagement with funding from the Baycrest-led Centre for Aging + Brain Health Innovation. Over one year, data was collected from 3 Responsive memory care and long-term care communities. Findings suggest that being highly engaged in recreational activity (including the use of Linked Senior) is associated with a 3% increase in cognitive functioning, a 20% increase in social engagement, an 18% decrease in aggression, and a 20% decrease in antipsychotic medication use.  There was also a $29,000 financial saving in staff efficiency. 

A representative from Juniper Village at Brookline in State College, PA, will present how their team became more efficient and productive using digital technology, including Linked Senior, to track residents’ changing needs and preferences, increase program attendance, and see some real results. In just two years, they’ve seen increases in resident engagement from 12 minutes per day, per resident, to 21 minutes, and increased resident participation rates to 93%. 

Home health and home care providers are often viewed as competition for the senior living industry. But collaboration with outside agencies can create a better resident experience and extend the length of stay. 

What follows is an interview with Sarah Walmsley, national director of strategic partnerships at Bayada Home Health Care, Moorestown, New Jersey. She is the head of business development for Bayada Senior Living Solutions. The Q&A provides a good roadmap of how to collaborate with a home health provider and make the relationship work.   

Q: Tell us about Bayada Home Health Care. 

Walmsley: We are one of the top home health providers in the country with revenues last year of about $1.3 billion. We offer a full range of services including skilled home healthcare, hospice, private duty care, behavioral health, staffing, assistive (personal) care and habilitation services (for those with intellectual/developmental disabilities). We recently added hospital management services to develop joint ventures with healthcare systems. Bayada was privately owned for 40 years, but last year it became a nonprofit organization in order to ensure its long-term continuity,  

Q: Where does Bayada operate?  

Walmsley: Bayada provides care in 22 states and in six countries. We have 330 offices and just reached a milestone of caring for over 1 million customers since 1975.   

Q: How many senior living communities do you work with?   

Walmsley: Our Senior Living Solutions division is providing care or contracted fitness classes in over 1,200 communities across 14 states operating out of 37 offices. Since the division was launched in 2012 we have experienced an 84% increase in senior living census growth. Senior Living Solutions currently compromises 30% of our home health practice. We serve about 5,000 residents. 

We are currently the provider of choice for over 300 assisted living/independent living and CCRC communities. That bucket of business is growing about 20% a year.  We enjoy deep trusted working relationships with the healthcare team of these communities and we work collaboratively to implement customized programming and interventions.  The end result is that we achieve remarkable results in metrics such as resident satisfaction, increased length-of-stay and rehospitalization rates that consistently are under 8%.  

Q: Are your service offerings growing?    

Walmsley: We added hospice services in 2017 and fitness services in 2015.  Fitness is growing 50% year-over-year based on customer demand and we are adding new class types and offerings, such as Parkinson’s disease and memory care specific classes. We have over 4,000 residents participating in classes each quarter and provide over 21,000 classes a year.  We added hospice care because senior living owners and operators wanted one provider.  Senior Living Solutions Hospice has seven offices in three states and now makes up 15% of Bayada’s Hospice practice. We project that within five years, our senior living hospice services will be represented across our home health and therapy markets.  

Q:  What’s the best way to establish a working relationship?  

Walmsley: There are essentially three best practices we have learned are necessary to have an optimal working relationship. First, agreeing on expectations and what success looks like is paramount when initially launching a new relationship.  We have found the most effective way to do this is by following an integration plan we create which incorporates engagement, education and trust-building activities with residents, care providers and leadership early on. It also provides a roadmap to phase in all the services we offer to prevent confusion or disruption to the community. Second, customization is key.  As we know, no two communities are the same, each has a different culture and unique needs.  Our model at its core is based upon an established communication and execution framework centered on the delivery of our key services. We meet with each key stakeholder to build out their optimal model. Modifications could be as simple as providing our outcome data meetings on days when there are fewer meetings or when the physician is present to create a fitness class for residents with Parkinson’s disease.  Third, quality assurance measures must be established for a collaborative care model to work. Setting success and accountability measures upfront ensures a good working relationship. At a minimal, outcome data should be shared and discussed monthly to identify if hospitalizations could have been prevented and to put in interventions to prevent future issues.   

What should senior living providers expect from a home health company?  

 Walmsley:  First and foremost, providers should look to align with a company that echoes their own mission and values. During the vetting process, they should ask to see their quality metrics (hospitalization rate, SOC rate and CMS 5-star ratings for quality and customer satisfaction), determine what scope of services they offer across the continuum and ask them to explain their proactive approach. Ask how clinicians are trained. A senior living operator should insist on a one-point person for their community who oversees the day–to–day operations.  Lastly, the selected provider should be included in their referral source’s preferred networks. It makes sense to align with a provider that understands the senior living landscape.  

Q: What does the home health company expect?   

Walmsley: We need to establish deep collaborative relationships. The community leadership and healthcare staff should look at their healthcare provider as a collaborative partner and trusted advisor and provide time to review outcomes and strategize tactics to reduce adverse trends. The community leadership should be honest if there are concerns and both entities need to be open to figuring out what each can do better to enrich the lives of the residents.  

Q: What is the financial arrangement?  

Walmsley: Home health services, including hospice and physical therapy, are reimbursed by the resident’s Medicare and private insurance.  Our fitness programs are customized for the community and the operator pays us directly for the program. In some cases, we lease gym space from the operator for our physical therapy program.   

Q: How do you handle workers coming in and out of the building? 

Walmsley: This is the pain point I hear about every day and that’s why people are calling us. We provide a dedicated team so the community always receives the same nurse, physical therapist, occupational therapist, speech therapist and social worker. The executive director knows who is coming into the building. A program manager is assigned to the community as their point person.  They own the relationship. We provide regular updates on who is on the service, how many visits the resident received, progress, discharge date, and other details. We have an electronic medical records portal to chart updates.   

Q: Do you need office space in the building? 

Walmsley: We don’t need office space. It is rare that we rent office space. We do in cases where we have a relevant enough census that would mandate us to have onsite staff on a day-to-day basis and the distance is too far from our office, then it makes sense.

Q: Are teams assigned to more than one building? 

Walmsley: We typically work in communities of 50-400 apartments. If a lot of residents require services we assign a team and backup team.  Most teams are working at 2-3 buildings.  Our mission is to keep patients from bouncing back into the hospital.    

Q: Do operators sign a contract? 

Walmsley:  We have a service agreement that maps out the communication and execution framework.  It includes a collection of best practices that if implemented will result in positive outcomes.  

Q: What percent of residents pick Bayada as a provider? 

Walmsley: Of course, residents always have a choice. The majority work with the recommended home health provider unless they have a prior relationship with another provider. Residents are usually looking for guidance. And they want to stay in their apartments as long as they can. We hold resident meetings to explain our services, answer questions and share our results 

Q: Do you work with physicians and other healthcare groups? 

Walmsley: Under healthcare reform, hospital groups, doctors and skilled nursing facilities are creating their own networks. Quality outcomes matter in a value-based payment system and that is our focus. We are in a lot of these preferred networks which is a reason why the senior living operators want to work with us. They know we have a seat at the table. It makes sense. For example, we have transitional care managers to ensure the resident makes a safe transfer from the hospital or skilled nursing center back to the community. A busy nurse at a community does not have time to call social workers to find out about med changes, check the paperwork, and be there when the resident arrives. We are a great value-add.   

Q: What’s ahead for collaboration? 

Walmsley: The silos are coming down. It’s exciting. We are talking to each other as true colleagues. We share the same goal to keep residents healthy. Health care systems, payers, insurance companies are looking for quality care at a lower cost. But they don’t think of assisted living as healthcare even though the sector is managing an elderly, frail high– risk population. We need to work out more creative models of care. 

One of the most important elements of success for a business or an industry is the continued development of leadership to ensure that the necessary human capital is available to embrace the challenges of the future, prepare for growth, and navigate critical issues. NIC and the seniors housing and care sector are no different. Leadership development is essential, especially for the continued success of delivering on the NIC mission which is to support access and choice for America’s seniors by providing data, analytics, and connections that bring together investors and providers. As the need for housing and care increases with an aging population, so too does the need for innovative thinking and the ability to solve the challenges ahead and embrace the opportunities for the future.

Over the years and since its founding in 1991, NIC has been driven by very talented volunteer leadership in its numerous industry initiative committees and in its Board of Directors. These talented volunteer leaders are largely responsible for the success of NIC and the need to have this continue is vital for the industry to continue growing and serving America’s seniors.  An avenue NIC has pursued to ensure this leadership continues is the NIC Future Leaders Council (FLC).  Established in 2009, the Future Leaders Council represents the best and brightest of the industry, which continues to develop emerging leaders within the industry bringing innovative thinking, fresh ideas, and new energy to ensure the industry/NIC is prepared for the future. The FLC has been extremely dedicated over the years and continues to grow into more of an important role for NIC and the industry. For example, the FLC was instrumental in delivering the latest version of the NIC Investment Guide which was released last Fall in 2018. 

The FLC is comprised of only 24 members and given that, it is very selective.  These smart and dedicated professionals come from the companies in the seniors housing and care and finance sectors that have volunteered time and resources to support NIC’s mission. As members of the FLC, these individuals contribute a significant amount of time to the NIC mission which includes working on various NIC committees and task forces and initiatives.  They also get the chance to develop volunteer leadership skills and have ample opportunity to form meaningful professional relationships with current NIC leaders while functioning as an extension of the Board.   

The selection process for the FLC is a highly competitive one, which includes a member application in addition to a nomination submission. Nominations originate from senior level executives within the industry.  The emerging leaders that are nominated are individuals within their companies that represent passion, commitment, strong leadership potential, the ability to think creatively and strategically, in addition to having 5 to 10 years of relevant work experience. The FLC is a three-year commitment, and members meet as a group quarterly. Each class focuses on different NIC initiatives and programs, always working closely with each other, the NIC Board, and various committees and task forces. 

One of the overall goals of the Future Leaders Council is to produce future volunteer leaders for NIC, and truly, the industry and NIC needs this as the next generation cycles through to leadership positions in an industry that is now more than ever in the spotlight given its importance to serving an aging population. Embracing the talent of the FLC is one way NIC is providing a solid path to prepare for the future and continuing to deliver on its mission. 

Please see the link below for current members of the FLC: 

https://www.nic.org/nic/future-leaders-council/senior-housing-investment-members/ 

We have to think about what’s best for this person, this patient, this resident, and carry that expertise throughout the different settings.

In today’s value-based care model, the focus is increasingly on incentivizing providers to do what’s truly best for the individual, the customer. Good outcomes are the goal, and the intent is to incentivize provider behavior that will produce such outcomes, at lower cost. That’s led to the realization that we need to have good hand-offs from one setting to another. In order to achieve coordinated, integrated care, information must immediately be transferred along with the individual. That means patient information including prescriptions, the treatment plan, the conditions they’re being treated for, and so forth, all must go along with the individual, from one setting to another. All of this is good – and important. But it’s not enough. 

Under the fee-for-service system, each of the silos within the continuum of care was incentivized to hold on to the individual using their services for as long as possible. Should that person have reentered a given care setting after being discharged or transferred elsewhere, it was all the better because payments would continue to be made as long as that person was in your bed. It was a perverse incentive, sometimes resulting in the hope that that patient would return, rather than heal and move on. It also placed different settings at odds, competing for dollars, rather than focusing them on working together to achieve good outcomes. As a result of these and other pressures, each setting functioned as a stand-alone silo and profit center. 

It’s time for those silos to break down and start working with each other. If that doesn’t happen, and coordinated care is just about good handoffs from one silo to another, we won’t actually benefit the customer, nor will we truly save money in terms of total healthcare spend. We will still be furthering that siloed mentality, in which experts in each silo still make decisions, independently of the experts in other silos, such as the hospital, skilled nursing, assisted living, or home health care settings. 

Each time you hand off to a new setting, the senior healthcare professional in that setting becomes like a dog marking its territory.

I can offer two illustrations of this problem. The first was related to me by a skilled nursing executive. Because the family members of a resident knew this executive, they called him to discuss their mom. She was on a managed care plan and had just been discharged to one of his properties from the hospital. Within 72 hours, they received three phone calls, from three different care coordinators: one from the health system, one from the managed care plan, and one from the skilled nursing facility. In each case, the call was to advise the family as to what was the best care plan for their mother. They clearly had not spoken to one another, let alone coordinated, as they each offered a different approach to her care. The family’s reaction was “no wonder health care is so expensive, and so screwed up.” All of the calls were made in the name of executing a good handoff. 

Another illustration I use comes from my time as a Maryland state representative. I sat on the committee which regulated all the different healthcare professions in the state and got to see all of their turf battles. Every group, from Podiatrists to Ophthalmologists, would come in and argue about who was qualified to do what. Each group would argue that only they were qualified. Today what I see, in terms of these different settings, even if there’s agreement on the need for integrated, coordinated care, reminds me that not much has really changed.  

If we just have a different team of experts in each setting, we’ll have turf battles – and the loser will be the individual receiving care. 

Each time you hand off to a new setting, the senior healthcare professional in that setting becomes like a dog marking its territory. They routinely overrule the other silo. You might hear a hospitalist say: “I don’t know why the consulting doctor in the skilled nursing facility recommended this prescription and that you do that therapy.” The skilled nursing physician might say: “I don’t know why they put you on that in the hospital; that’s nuts, given your history – they must not have looked at that.” Then the managed care company comes in, saying: “I don’t know why either one of them is doing this; that’s so expensive, and so uncalled for.” In each case, they’re saying, “we’re the experts” and they show it by stepping all over the advice the patient got from the other care settings. 

This dynamic is why, if all we focus on is good hand-offs, we will fail to truly produce the best outcomes for the patient, at the lowest possible cost. Instead, we have to have coordinated, integrated care not just in the hand-off, but across all the settings and throughout the individual’s care journey. We have to think about what’s best for this person, this patient, this resident, and carry that expertise throughout the different settings. If we just have a different team of experts in each setting, we’ll have turf battles – and the loser will be the individual receiving care.  

There are practical examples in which coordinated care teams disrupt old silos and achieve integrated care at lower cost. For an excellent read on the practical aspects of coordination, you can download the paper “How Disruptive Innovation Can Finally Revolutionize Healthcare”. Written by Clayton Christensen, Andrew Waldeck and Rebecca Fogg of Innosight and Christiansen Consulting, the paper, which is subtitled, “A plan for incumbents and startups to build a future of better health and lower costs” provides evidence that this approach is not only cost-effective, but necessary if we really wish to achieve great outcomes for Americans. We recommend anyone interested in achieving better outcomes, at lower cost, read the paper. I welcome further discussion and comment from those in the business of caring for people – across every setting – on how best to achieve meaningful results.