NIC Chats Podcast with Cindy Baier

Introduction : (00:02)
Welcome to NIC Chats, ideas and inspiration from senior living leaders with host Beth Mace, NIC's chief economist and director of outreach. Get to know some of the people influencing senior living today and perhaps learn a thing or two from their experiences.

Beth Mace: (00:19)
Hello and welcome to the NIC Chats podcast. My name is Beth Mace and I'm the chief economist and director of the research and analytics team here at NIC. Thank you for joining us today. The focus of the NIC Chats podcast is talking to interesting people that have ideas. I think you'd really like to hear about as you listen today, I hope that you'll find some humor, insights, inspiration, and hopefully what I call an aha moment when something pithy or insights said in a light bulb may go off for you. So let me tell you a little bit about the structure of today's event. First, I'm gonna tell you three statements about my guest. Two of those will be true. And then throughout the podcast you'll learn, which is true and which is false. Second, there are three standard questions within each podcast for each speaker and the first will be "what's a large challenge facing our industry?" Second, "what's one thing that we can do to grow talent in our industry?" And third "what's an innovative way or idea to strengthen our industry?" Now, as they say on with the show. So I'm delighted that today our NIC Chats podcast is with Cindy Baier. Cindy is the president and CEO of Brookdale Senior Living. Cindy, thank you for joining us today,

Cindy Baier: (01:32)
Beth. I'm so glad to join you. And I just wanna start by saying how much I admire you. NIC has done just such wonderful work and we are ways excited to hear your views on the industry and the future. And you've just done such great service for our industry. So thanks for everything that you do.

Beth Mace: (01:51)
Well, thank you. You're making me blush. So let's go through the three statements first. So, during the course again of the podcast we'll learn, which is true, which is false. So one of the highlights of your job is spending time in the communities with your residents, or you have met many people in the industry that are willing to make extraordinary sacrifices for others. You've seen this more in the senior housing industry than in any other industry that you've worked in, or you are an extrovert who loves being in the spotlight. During the course of the podcast here we'll learn, which is true and which is false.

Cindy Baier: (02:31)
Can't wait!

Beth Mace: (02:31)
So let's start. So tell us a little bit about Brookdale Senior Living and your role.

Cindy Baier: (02:36)
So I'm the president and CEO of Brookdale and I serve on the board of directors. I have done that since the end of February in 2018. Brookdale is the nation's largest senior living operator in the country. And we operate 682 communities across 41 states with the ability to serve more than 60,000 residents. We've got a very broad continuum of care. We operate independent living, assisted living, memory care, and we've got some skilled nursing as well. Our mission is to enrich the lives of those we serve with compassion, respect, excellence, and integrity. And what's really important is that we provide care to seniors. We give them a personal connection and we provide services in an environment that feels just like home.

Beth Mace: (03:29)
Wow. That's terrific. Actually, I've been to some of your properties and I can attest to what you're saying, actually. So that's great. You just said you became president and CEO of Brookdale in 2018. So what's your role there and what surprised you about this job as you, as you've gotten into it?

Cindy Baier: (03:46)
Well, I think my role is the keeper of the culture. I'm ultimately responsible for setting the strategy with the assistance of the board and the management team. And as part of that in 2018, we initiated our turnaround strategy and we called it our "win locally strategy" in 2018. As part of the time that I've been the CEO, I'm pleased that I've led Brookdale through the largest public health crisis in a hundred years. And we did that by really prioritizing the health and wellbeing of our residents and our associates. And I've been particularly focused on increasing diversity in our company, in our industry and I'm very proud of the work that we've done on our board. Increasing both gender and racial diversity, as well as with the leadership team. My executive leadership team is approaching gender parity, which is something I'm pretty proud of.

Cindy Baier: (04:41)
And then on the capital structure front, I have been very involved in leading and renegotiating some of our largest leases with all of our large landlords. We've led the sale of assets, including our interest in our unconsolidated entry fee CCRC business, as well as the majority of our home health and hospice and outpatient therapy business. And what this has really done is it has allowed Brookdale to be focused on what we do best. We help seniors with the challenges of aging, and we do that through our predominantly assisted living and memory care portfolio. I will say that my time at Brookdale has been filled with surprise. I think probably the greatest surprise that I've seen is just the level of sacrifice that our Brookdale associates have been willing to make to serve our residents and to help each other. Some of our biggest challenges have also been our brightest moments. When the country started sheltering in place in 2020, Brookdale heroes came out of their homes across the country to take care of our residents and patients. And it was really amazing what they were able to accomplish on behalf of our residents. They transformed our business model, literally overnight for the benefit of the seniors that we serve. And I have to say that the most satisfying thing really has been our mission. We focus on enriching and saving lives quite honestly. And I think the insight that I would really is that the focus on our mission is vital. You have to lead with empathy, with gratitude, you have to be very actively involved in the business. And it's really important to listen.

Beth Mace: (06:32)
That's quite a lot that you've done in the last few years and as you mentioned on top of COVID. So let's go back a little bit to the DEI. Why is that important for your business?

Cindy Baier: (06:41)
Well, if you think about it, the majority of healthcare decisions are made by women. The majority of our residents are women and the majority of our associates are women. And so if we don't have a board and a leadership team that looks like our residents, that looks like the associates that we serve, I don't think we can completely understand what our residents want, how they feel, what they need. And as you think about that, even age diversity is important. You know, certainly as you age your perspectives change. And so we've got quite a bit of age diversity on our board as well.

Beth Mace: (07:20)
That's great. And I'm sure that sort of percolates down throughout the entire organization and people respect that. To be led by people that are more similar to them.

Cindy Baier: (07:29)
And it's really not just diversity. It's about inclusion. We are in a business of relationships. And so we wanna make sure that everyone feels included, they feel welcome. They feel like they can bring their whole self to work or to home.

Beth Mace: (07:44)
So how do you do the inclusion part if you're sort of a young new staff assistant? How do I feel included?

Cindy Baier: (07:52)
Well, it's very intentional and I have to say that I host a number of our associates at our home from time to time and get the chance to cook for them. And just spend time getting to know who they are and what they like. But it's often time spent just learning about each other to talk about different perspectives and to understand what's really important to people, what they value and sort of what they want in life. And I think that our business being such a relationship driven business, it's taking the time to get to know people and really connecting with them. And that's really what builds a culture that has a lot of inclusion in it.

Beth Mace: (08:36)
So labor has been a top issue for a long time and not even since the pandemic, but even prior to that. So, I think a lot about the people that we serve on the front line and I think about the seniors themselves as wisdom keepers and how much younger people in particular can learn from that. So is that something that you see in Brookdale with some of your associates and team members?

Cindy Baier: (08:57)
Absolutely. I think that the second paycheck in senior living is the gift of life well lived. And I can tell you from me all the way down to the associates who serve in our communities, the greatest gift really is the connection with our residents. They have the time to share the wisdom that they've learned. If you think about it at Brookdale, we have had residents who won the Nobel prize. We have individuals who are Rosie the Riveter. We have some of the most interesting people that you can imagine and they have time and they are looking for a genuine connection. And so what I like to tell parents, really parents with teenage children, you can have your child get experience in virtually any job, but how will they feel being able to go into a community where they've got literally lots and lots of grandparents and adopted grandparents that they can learn from. And we see that particularly during COVID when we had residents who really built even stronger relationships with our associates, they wrote poems to each other. They shared sporting events and games. But it's amazing just the connection that we see between our associates and our residents.

Beth Mace: (10:25)
Yeah. I think that's so important and I'm not sure that message of ours gets out. So to me, the idea of just talking about the mission of the heart, for what we do is a message that should be passed around as much as we can to draw people into our workforce. The second paycheck, I like that.

Cindy Baier: (10:42)
It's incredible.

Beth Mace: (10:43)
I'm gonna call that one of the aha moments. That I'm hoping that we can share with our listeners. So the second paycheck of, of doing work, that's passionate for you. So that's great. So what are you most bullish about Brookdale as you look ahead?

Cindy Baier: (10:57)
Well, look, I think that there is a lot to be optimistic about when you look to the future. First of all, if you look at the demographics, the demographics are incredibly compelling with the number of potential residents who enter into our target market each and every year. If you look at supply the entire time I've been in the industry, we have been in a situation where there's oversupply. But I do think that one of the silver linings of COVID is that that supply is starting to rationalize. I'm also really excited about healthcare coming into the home. And if you think about senior living communities and you think about what we offer... We're home. And so our ability to bring more services into our communities, to help people better manage the challenge of aging, it's such an optimistic time to look and reimagine the future and what it may be.

Beth Mace: (11:53)
What would be an example of that?

Cindy Baier: (11:54)
Telehealth is a perfect example. If you think about sort of the world that we all knew sort of before 2020, if you needed to go to the doctor, it wouldn't necessarily be convenient. You'd have to schedule a visit. You'd have to go out, you'd have to find parking. You'd have to wait for the doctor to see you. Telehealth is incredible. And the ability to see a doctor to get the care that you need from the convenience of your home is wonderful. And what's exciting about senior living in particular is we wrap telehealth with services around the seniors. So if you think about an assisted living community, we've have a nurse on staff. And so if somebody needs help with their blood pressure or temperature or things like that, we have somebody who can help them do that. So I do think that assisted living and senior living overall is gonna become much more connected to the healthcare continuum. And we're really excited it be leading the way on that.

Beth Mace: (12:55)
That's exciting. And I think in the bigger picture, it actually helps when you have this huge group of baby boomers that are coming into the senior housing market to be able to provide healthcare at more affordable rate in the sense that you can provide the services in a more, I think, cost efficient and economical way.

Cindy Baier: (13:12)
Absolutely. And if you think about people who've been in the hospital, you have to be in the hospital if you need care. Right? I don't know anybody who really wants to be in the hospital. So if you can find a way to get the care that you need in a more comfortable setting. Someplace that you're completely comfortable with, but also to have that supportive care, to help you with preparing your meals, to help you if you need assistance with the activities of daily living, that's something that's uniquely available in a cost effective way in senior living. And I think we just need to get that message out because it is truly something that is a big benefit for residents, for families and for the overall healthcare system.

Beth Mace: (13:56)
Okay. So I have one more question in terms of management style for you at Brookdale. You're a big organization, as you mentioned at the beginning with over 60,000 residents that you can be taking care of at any one time. So how do you manage such big organization like that?

Cindy Baier: (14:10)
Well, it's all about people, right? At the end of the day, you've got a hire great people. And so I started by saying, I'm the keeper of the culture. And we need to find the people who are attracting, engaging, developing, and retaining the best associates. And we have a strategy of winning locally because everything that we do comes together in our communities. And so it's really about setting guardrails so that we can make decisions in Nashville that we need to be consistent about throughout the country. And that would be things like designing our leading memory care programs, but at the local level, there are things that are most appropriate to be conducted by the executive director or the health and wellness director, the sales director. And it really allows the, the local teams to tailor what happens in the communities to the specific needs and wants of the residents.

Cindy Baier: (15:10)
I all also do think that it's important to spend time in communities. I get into our communities as much as possible as does our leadership team. One of the things that I started when I became CEO was something we called community learning visits. And so we serve side by side, and housekeeping and dining in the kitchens. Our maintenance people did maintenance repair work. We did sales calls. And what that allowed us to do is to really make sure that all of our decisions are informed by what the people who actually do the work think.

Beth Mace: (15:47)
That's great. That's really good. And I'm sure you're making... When you go to those properties, I'm sure everyone thrilled that you're there as well.

Cindy Baier: (15:54)
Absolutely.

Beth Mace: (15:56)
So let's go back to the three statements. Is this true or not true that you have met more people in this industry that are willing to make extraordinary sacrifices for others than in any other industry that you've worked for? I think your comments already speak to that, but any other thing you wanna say to that? True or false?

Cindy Baier: (16:11)
That is definitely true. I think that this industry is very special and the people who are attracted to this industry have the biggest hearts that I've ever met, and they tend to put the people that they are responsible for helping first and the lengths that they will go to is just something that could never have imagined before joining the industry.

Beth Mace: (16:36)
Yeah and I'm sure that was showing a lot during COVID.

Cindy Baier: (16:39)
It was.

Beth Mace: (16:39)
All right. So let's switch tracks a little bit. Let's talk a little bit about your life and your career path and how you've gotten to where you've gotten and any tips you might have for younger folks that are trying to follow your footsteps.

Cindy Baier: (16:52)
So I'm a farm girl from central Illinois, and growing up on a farm, you learn the benefit of hard work. It's fair to say that I was looking for a bit of an easier life. I am not sure that I found it but I started by going to college and getting an accounting degree, started in public accounting. And that gave me the ability to see a number of different industries and to really learn about how businesses make money through doing that. I really wanted to be something in an industry where I could see the work product for more than a few weeks at a time. So I spent my career in many different industries in finance. And had the opportunity to do many finance jobs and many operating jobs. But when I got the call to come to Brookdale, I knew this was gonna be home for me.

Beth Mace: (17:41)
Really?

Cindy Baier: (17:42)
I joined six years ago as the CFO. And I just knew that I had to be part of this industry. And then a couple of years after I joined as a CFO, I was given the opportunity to lead Brookdale. I think the advice that I would give is work really hard. I don't think there's any substitute for hard work. Play well with others, everything that we do in this industry as a team sport. And so you need to build relationships that really can deliver. And then I think this is more important than almost anything, else solve difficult problems. If you can solve tough problems, you will never have a limit on what you can do or what you can be and take it from me. I wasn't looking to be a CEO. The board approached me, but I think they approached me because of my reputation as a problem solver.

Beth Mace: (18:36)
So what's a secret to solving a problem. I mean, there's problems... We face 'em all the day. So how do you go about doing that? I mean, do you take piece of paper, write it down? Do you brainstorm? Do you think about it overnight? Do you get a good team of people or...

Cindy Baier: (18:48)
I think it involves a lot of research and diligence, right? You wanna study a problem from every angle available. You absolutely want to build a team of experts from a diverse perspective, different functions, different levels, different aspects of decision making are really important. You wanna do a lot of brainstorming and you're not gonna know that you've got the best solution until you put a lot of ideas on the table. Some of which are absolutely terrible, but unless you put those terrible ideas on the table, you're not gonna get the great idea. And then really don't be afraid to debate, right? You've got to really challenge the limits of your thinking and to figure out what are the unintended consequences, and then figure out a path, start down the path, track your success, to see if you are making it. And if not change directions, because sometimes, and we certainly learn this during COVID, sometimes the first direction you take, you hit a roadblock. And so you've gotta go a different direction until you hit a roadblock. And if you just keep pivoting until you solve the problem, you'll ultimately be successful and put the problem in the rear view mirror.

Beth Mace: (20:03)
Wow. I think that probably a lot of people are gonna replay that a few times. Cause that was really sound advice on how you go about thinking about a problem and clearly you've been effective at Brookdale. So thank you for sharing that. So we talked a little bit about why seniors housing, cuz there's a passion to it because you're affecting people's lives. Anything else that you'd want to tell someone who's thinking about what career to go into?

Cindy Baier: (20:29)
I can't imagine any career that is more important or more rewarding than our industry. If you think about just the fact that this is a real estate business, it's a hospitality business, it's a healthcare business. It requires so many different elements of success and skill sets. You'll never find an industry that will be as challenging or more rewarding than this one. And so whether you wanna start on the capital provider side, whether you wanna start on the operator side, whether you wanna start in the communities or corporate office, you can find enough challenges to fill your career. And more importantly, to really be something that's bigger than yourself at the end of the day, I think we're all searching for meaning in life, a way to make a difference, a way to leave the world in a better place than we found it. And this industry is unmatched in terms of the opportunity to do that. So why would you ever settle for an industry that's not ours?

Beth Mace: (21:33)
Well, there you go. We're gonna use that now as our one question we had is one way to grow talent in our sector. I think I just repeat what you said there. So that was a good summary. I feel exactly the same way cause I've been involved in a lot of industries in my life as well. And when I got involved in senior housing, although I'm not as directly involved as you are, because I don't see residents on a daily basis, but yeah, you can feel good about what you're doing at the end of the day.

Cindy Baier: (21:56)
Well, Beth, you could come to our communities at any time. Our residents would love you.

Beth Mace: (22:00)
I might take you up on that.

Cindy Baier: (22:02)
Absolutely.

Beth Mace: (22:04)
So let's switch a little bit more now to the broader seniors housing sector. What's your near and longer term view? We talked a little bit about demographics. Is there anything else from a bigger picture of why you think senior housing is a... What are some of its challenges and opportunities?

Cindy Baier: (22:19)
Yeah, I think with regard to challenges, there's no question that this is the most difficult labor market in my lifetime. I wonder how many challenges our industry can get it sort of at once. I think that it is something that we're addressing. We are as an industry taking strong actions to make sure that we continue to be an attractive place for people to build their careers. And so while it's gonna be challenging in the short term, I think in the long term, I think that solves itself and we are able to work through that. Certainly consumer perception is also a challenge and certainly as we think about COVID waves and the comfort that residents or prospects or medical professionals have with our industry, it tends to peak and wane as the case counts around the country... Outside of our communities change.

Cindy Baier: (23:14)
And so I think that's a challenge, but I think the opportunity is our industry has really done an amazing job at infection control. And so I think that the story that most people don't understand is that our residents are largely vaccinated across the industry. Our staff are largely vaccinated across the industry. And so I think there are a lot of reasons to have comfort in our industry. And so I think we're gonna see a little bit of a roller coaster in the short term, but I do think that the long term vision is compelling. I also would say in the short term, this battle against COVID-19 has been very expensive. And so it's had a financial impact on the entire industry and I'm grateful that Brookdale has had the resources that we've needed, but I do think there are others who have suffered. And I do think that there are gonna be communities that aren't able to hold on until the demand and supply balance is better. And so I do think that's gonna be something it'll be a challenge for the industry in the short term.

Beth Mace: (24:22)
Yeah. So just for those who may not be familiar with the data of the occupancy rate for senior housing in the third quarter was about 80%. So one in five units are not occupied right now. And for some operators that's a lot lower and for some operators that's a lot higher. So yes, if you don't have the right kind of financial partners I think that there are more challenges and we're starting to see that in some of the stories and in some of the data that's coming up. So I know you know, that NIC did a study called the "forgotten middle" a few years ago in 2019, and it really was trying to target providing housing and care options to middle income seniors. How does Brookdale fit into that?

Cindy Baier: (24:58)
Well, I definitely think this study, the "forgotten middle" was a critically important study. At Brookdale we currently don't have De Novo development underway. That's something that I hope that we'll get back to sort of in the future, but certainly with COVID it has put some of our growth plans a bit to the back burner as we focus on operating our existing communities and really growing through improving our occupancy. So I think it's something that we'll continue to look at. I do think there's a huge need for the product. Particularly as there are fewer caregivers in the future to take care of the seniors who are growing at a faster rate than ever before. So it's something that we'll continue to look at.

Beth Mace: (25:42)
That's great. Because in terms of the caregiver ratio, this is the number that some people may not know that if you look at the number of people in the US that are over 80 years old, relative to those adult children who are 45 to 60 year old, that ratio drops from seven to one to four to one by 2030, and then to three to one by 2050. So simply are fewer children to take care of adults. And also divorce rates are higher, so you don't even have a spouse necessarily to take care of you. So the idea of needing an institutional or more congregate setting is so evident if you just look at the data and how it's gonna grow in time.

Cindy Baier: (26:19)
Well and I think even if you separate out the reduction in caregivers, I think that just the relationship that you have with your mom or dad, it's not the, the same if you become a caregiver. And I know from firsthand experience, just the difference in relationship from being a caregiver to having my mom in a supportive community. I got to be her daughter again. And so I do think that's something that we, as an industry have to do a better job at telling the story because most people don't truly understand the impact it has on relationships when you are that unpaid caregiver.

Beth Mace: (26:52)
Yeah. That's a really good point. I've been there too, so I totally agree. Does change your relationship for sure. So let's go back again to that two truths and a lie. True or false, one of the highlights of your job is that you get to spend time in the community with your residents. I think that's gonna be a true.

Cindy Baier: (27:11)
That is absolutely true. I get in the communities as often as I can. I was actually just in our communities last week and I just am so lucky to have the opportunity to visit with our residents, to learn from them, to build genuine relationships with them. It just means so much to me to connect and that's my why. That's why I do what I do.

Beth Mace: (27:39)
So that would mean, are you an extrovert or an introvert? Do you like being in the spotlight?

Cindy Baier: (27:45)
I am an introvert with a capital "I." And most people who know me don't realize that I'm incredibly shy. Outside of work, I tend to stay home with my husband. We don't even go out that much. We are definitely home bodies. So being in a public company, CEO role does take a lot of energy for me because I love being alone.

Beth Mace: (28:08)
Oh, well you do a good job otherwise. You wouldn't know that. So that's awesome. Okay. So just maybe one or two other questions for you. What's an innovative way that you think we can strengthen our industry? It could be on the capital side, it could be on the operation side, something sort of out of the box or not out of the box, rather. There's something new and exciting that you've been thinking about.

Cindy Baier: (28:29)
Well, I think at the heart of the issue is really building a culture of innovation, right? We have made innovation a key part of our strategy, and it seems odd to think about innovation now in 2021, when we just reimagined basically every single element of our business model over the last two years. And so I think that innovation really is gonna come down to organizations making it a priority, creating a culture where new ideas are piloted and the best ideas succeed. We have to make sure that there is a way to experiment and to fail fast as long as it is not involving resident health and safety. But to really look at those products where... Products and services that are gonna make our industry more attractive. And so I do think for Brookdale, one of the biggest innovations that we're gonna see coming up is our ability to innovate around healthcare and around helping residents live the best quality of life they can, as they define it, for as long as they possibly can.

Beth Mace: (29:36)
Wow. That's terrific. Well, I look forward to seeing some of those innovations over time as well. So Cindy, thanks so much for your time today. Any other comments you wanna make before we give it a wrap?

Cindy Baier: (29:47)
I think this has been a really exciting podcast. Not because of my participation Beth, but because of your ability to really ask questions that inspire people to think differently and really to demonstrate just what a thought leader NIC is and you are. And so thanks for doing this and for sort of giving people the time to step back, think differently and maybe to have a new and creative outlook for the future.

Beth Mace: (30:19)
This is great. You know you made me think of one thing when you were talking about going into communities. Do you have a place for volunteers?

Cindy Baier: (30:26)
We do. And virtually all of our communities have volunteers. Certainly depending on what's happening in the outside world. Sometimes we have more volunteers than others, but we definitely love to have people come into communities because the residents love it and the volunteers love it.

Beth Mace: (30:42)
And would that be from high school all the way up to older adults as well?

Cindy Baier: (30:46)
Absolutely.

Beth Mace: (30:47)
Yeah. That's great. So maybe that would be an aha moment and a takeaway for someone listening as well that they could go down to their local Brookdale and go in and see if they can do some volunteer work.

Cindy Baier: (30:58)
That sounds great.

Beth Mace: (30:58)
So I might just do that today. All right. Thanks again and we'll be in touch I'm sure. We'll see you soon.

Cindy Baier: (31:06)
Thank you.

Beth Mace: (31:06)
Thanks Cindy.