Senior Housing and Assisted Living

By Doug Fullaway, President & COO, Vigilan

In a previous article, we explored the staffing in assisted living based on ratios versus staffing based on acuity. Ratios are the most commonly used, but it is also clear there is a tendency to overstaff and in all cases, ratios ignore the actual changes in acuity for an individual resident. Staffing based on acuity is preferred, but not widely used as it seems to be too difficult to implement. Let’s look at one method that can be used to develop an easy-to-use acuity staffing tool.

The first step is to build a spreadsheet with a column for each service you are offering and a row for each resident. For bathing you could look at your own assessment document and you might add the following columns: Independent, Provide Reminders Only, Partial Assistance, Full Assistance.

Enter a row just above all of the resident’s names that says, “Standard Time.” In that row enter a standard time. But where do you get that time? Start with an estimate. You know a great deal already and these times can be revised as you learn over time. And be consistent in the way you set the times. For example, hours per week or hours per month is a reasonably simple way to think about the services. Full bathing assistance might be 30 minutes per bath and delivered twice each week so one hour per week could be a good place to start with a standard time for bathing.

Now fill in the cells for each service that a resident receives services. Your spreadsheet is filled out and ready for some simple analysis.

Add totals at the end of each row and each column. You will see the acuity as measured in hours for each resident. Does this comparison across the residents seem reasonable? Does it seem correct that Martha takes twice the time as most other residents? Is John really only taking three hours a week for all of the services you provide? If not, perhaps you need to start adjusting the time for that resident. If the standard time for full bathing assistance is one hour per week and you know John is just difficult and requires more time, then perhaps the cell for his bathing needs to say 1.5 hours.

Now look at the totals for each column. You will likely see the amount of time for medication management for each resident is about six hours per month and is the largest single time for any service. If this is not the case, then perhaps you are doing some work that does not show up on the assessment. For example, does the nurse provide a monthly review of the medications? And does it take about 20 minutes for each resident? Time to add a column to reflect the time the nurse is actually putting into the work for that review.

Build a summary for each job skill of the total time for the period. Caregivers deliver the care for many of the columns.

You will probably end up with something that looks like this.

As residents move in, add a row. As they move out, remove a row. As you update an assessment for a resident, update the cells for that resident. You can gather the caregivers who take care of Mary Albright and have a discussion to see that all services being delivered are documented. You can also ask how long it takes to do the job for each service for Mary.

You can also make the standard times more accurate by actually measuring how long it’s taking for that service for about 30 observations and then take an average time. Adjust the time upward by 20% to allow for lunch breaks, taking time to talk with residents, filling out reports, etc.

You should see several benefits from your use of an acuity-based staffing approach. You will better understand where your staff time really goes. You will adjust your staffing based on changes in census AND based on the change in care you are delivering to each resident. (Ratios just don’t do this!) And our analysis shows you will have enough staff, but not too much, which should save you money.

About the Author:

Doug Fullaway is president and COO of Vigilan, a provider of software for senior living management, and has over 30 years of management experience. In 2002, Doug entered the senior market by joining the executive staff of Vigilan and is the proud owner of several senior communities.  Prior to Vigilan, Doug held positions in distribution, manufacturing, customer support, sales, and general management in the U.S., Europe and Asia.  Doug earned his undergraduate degree in industrial engineering from Oregon State University, served as an infantry officer in the US Marine Corps and graduated from the Harvard Business School.  In his spare time he loves to snow ski, fly a Cessna and go fly-fishing. He can be reached at dougf@vigilan.com.

Can you afford to get older?  According to a new Harris Poll, most people are not confident that we as a country are prepared to handle the costs generated by an aging population as Baby Boomers grow older.  The findings of the survey suggest that many people are aware of the challenges yet are willing to consider possibilities on addressing solutions such as encouraging people to work longer and to increase the age of eligibility for Social Security and Medicare.  Unsurprisingly, raising taxes or cutting benefits are much less acceptable. However, raising taxes is less unpopular than cutting benefits.

Surveying 2,576 adults online, Harris Interactive found the public is split on whether we will be able to afford the cost of many more old people (33%). According to Harris, 38% said will not be able to do so or 29% are not sure. More younger people (47% of Echo Boomers) and 51% of Gen Xers (aged 34-45) than older people think we will not be able to afford it.

Other results from the survey found:

• A 47% plurality of adults – but less than a majority – thinks that it is a good thing that life expectancy is increasing and that there are likely to be many more old people. Older people are much more likely than younger people to believe this; 58% of people over 65 think this but only 35% of “Echo Boomers” aged 18-33. While only 20% of adults think this is a bad thing, fully 34% are not sure.
• When confronted with a list of five possible ways of addressing the future cost of Social Security and Medicare, a third (35%) of adults say they don’t favor any of them. Possibly they do not believe the underlying premise that there is a problem. By far the most people (47%) believe we should “encourage people over 65 to work.” The next most acceptable option would be to increase the age of eligibility for Social Security and Medicare (30%). Only 21% think we should raise taxes while very few people (9%) think we should reduce Medicare or Social Security benefits.
• When told that “most economists think it is inevitable that we will have to do one or more of these things, whether we like it or not” and asked to pick two, the same pattern emerges. Fully 61% favor encouraging more older people to work, and 46% favor increase the age of eligibility. Almost a third (31%) choose increased taxes while very few favor cutting benefits for Social Security (10%) or Medicare (12%).
• A large 68% to 16% majority (with 15% unsure) believes “we as a society are not adequately prepared to spend more years caring for our aging parents than for our children.”
• A 50% to 26% plurality of those aged 18-64 believe that “our health care system, as it is now,” will not be able to handle the large number of older people who are likely to have chronic medical conditions such as heart disease, diabetes and arthritis.
• When told that “many economists think that, to pay for Social Security and Medicare . . . many more people should retire later and continue working after 65,” a large 64% to 25% majority of those under 65 agrees with this.

“These findings are interesting and important,” said Dr. Robert Butler, the president of the International Longevity Institute. “It is good to see public support for people working later in their lives. This would not only reduce the economic problems addressed in the survey; research shows that people with purpose and who have something to get up for in the morning live longer and better lives. There is also evidence that increased longevity creates new wealth.”

Most People Believe that We Are Not Prepared for Increase in Longevity and Number of Old People

A new low-tech elder monitoring service called FineThanx recently made its debut that utilizes only the existing phone system at home.  The system calls twice a day find out how an aging loved one is doing and reports the response or lack thereof in either case.  The automated phone service checks in with seniors once or twice a day.  If no one answers, or if a client needs assistance, the system immediately calls a "care circle" of people who can seek care for the client.  If the client is fine, the system sends reassuring e-mail messages to the client’s families, friends or health care professionals.  FineThanx charges $34.95 a month for the service and offers a seven-day free trial period.

Costs for long term care in the US continue to rise but a recent study shows the cost for in-home care is rising at a much slower pace.  According to Genworth’s 2010 Cost of Care Survey, the cost to receive care in the home has risen at an annual rate of just 1.7 percent over the past five years. That compares to annual increases of 6.7 percent for assisted living facilities, and 4.5 percent for a private room in a nursing home, over the same period.  Genworth states that 73% of its initial benefit claims are for home health care.

Some highlights include:

Nursing Home Costs Continue to Rise

In 2005 the median annual rate for a private nursing home room was $60,225, compared with the 2010 median annual rate of $75,190. This means that Americans can expect to pay approximately $14,965 more per year today for a nursing home than they had to pay in 2005.

Home Care Costs Holding Steady

In contrast, rates charged by home care providers for "non-skilled" services have not experienced significant growth over the past five years. The national hourly private pay median rate charged by a licensed home health agency for a home health aide was $17.50 in 2005, while the 2010 hourly rate has gradually risen to $19. Home care rates have remained in check partly due to increased competition among agencies, the availability of unskilled labor, and the absence of costs associated with maintaining stand-alone health care facilities.

The Least and Most Affordable States for In-Home Care

Genworth’s 2010 Cost of Care Survey revealed that Alaska, Minnesota and Rhode Island are the most expensive states for home care, at a median rate of $25 per hour for a home health aide provided by a state-licensed agency. The most affordable states are Alabama and West Virginia, at a median rate of $15 per hour.

"Long term care is not just about nursing homes anymore. Care options have expanded dramatically over the past several years to include a far greater choice of settings that reflect the ways in which individuals prefer to receive care," said Buck Stinson, President, U.S. Life Insurance Products at Genworth.

The U.S. Department of Health and Human Services Office on Disability recently announced the award of over $6 million under the American Recovery and Reinvestment Act of 2009, to establish a Center of Excellence in Research on Disability Services, Care Coordination and Integration.  The contract was awarded to Mathematica Policy Research for a two-year period and is aimed at building the infrastructure necessary to support and conduct research on the effectiveness and comparative effectiveness of systems of care for people with disabilities. 

"With the establishment of a Center of Excellence in Research on Disability Services, Care Coordination and Integration, we will make necessary data improvements to better understand health and support services for people with disabilities," said HHS Secretary Kathleen Sebelius. "The data collected will allow the Office on Disability and the Centers for Medicare and Medicaid Services to examine the effectiveness of different services and supports being provided, and in turn, improve care for people with disabilities."

Thinking about retiring in Mexico?   How about developing senior housing and living product south of the border?  The opportunities exist but major challenges remain to make retiring south of the US border a slam dunk.  A group of business executives known as AMAR held a conference in San Antonio this past weekend to promote development of senior living in Mexico.  The group consisted of consumers, marketing professionals, real estate developers and various finance professionals and had sessions for both business representatives and consumers.  The conference was primarily spoken in Spanish with translation to English as the majority of attendees were from Mexico.  Some of the key take aways from the conference were:

• All owners and operators consistently stated that costs are 50-60% less in Mexico than in the US or Canada for physical development & final costs.  This was a consistent subject when listening to different developers in all parts of Mexico. 
• Healthcare solutions exist at various price ranges throughout the country including coverage for catastrophic emergencies depending on Visa status
• Most developments are for independent living (i.e.  homes and fractional residences)
• Proximity to Airports and Border are critical.
• Safety.  Despite the press, retirement in Mexico remains safe.  Presenters stated that the conflict exists between the druglords and the federales / police, not the retirees.
• Some developers are repositioning their properties as retirement locations rather than second home destinations.  Sales pitch is still resort lifestyle with CCRC type of amenities.
• Connectivity.  Researchers state those who are retired in Mexico today are in communication telephonically and via the Internet on a regular basis not much different than in the US.
• Medicare in Mexico.  This is the most critical part to explosive growth for retirement in Mexico.  While there are initiatives to bring Medicare from the US to Mexico, participants stated that this is a big wish.  Access to healthcare providers is top priority in those looking at retiring and those who already have retired in Mexico.

Final thoughts:  Retiring Mexico is a good alternative if you are looking for a temperate retirement, are mobile, in reasonably good health and have a sense for adventure.  There are groups of Americans retiring and living in Mexico in growing numbers so finding a community with Gringos is not out of the picture.  For development, until there is some kind of relationship between the US and Mexico for medical coverage (think NAFTA for healthcare…), Mexican retirement is a niche that is a viable alternative for a small group of American retirees.

Look for a few follow up articles from the conference focusing more specifically on segments of retiring in Mexico.

Watercrest at Mansfield, Mansfield, Texas’s first and only active adult community, recently announced that the facility has officially opened their doors to residents.  Watercrest at Mansfield offers resort-style living on 12 park-like acres. The campus features 11 villas and 200 independent living apartments for lease with features that include a heated saltwater pool, hair/nail salon, media library and learning center with Posit Science classes, fitness center, arts and crafts classroom center, and massage therapy salon.  The 13,000 square foot club house is the center of the gated community offering an array of recreational and social activities.

“We are thrilled that the doors of Watercrest at Mansfield are now open,” said Rick Simmons, president and CEO, Integrated Real Estate Group, developer of Watercrest at Mansfield. “The first residents are already taking advantage of the wide array of services and amenities offered by the community.”

As the economic recovery picks up steam, home improvement spending is projected to increase as homeowners look to improve their homes with smaller improvements rather than trading locations.  According to the Leading Indicator of Remodeling Activity (LIRA) released this month by the Remodeling Futures Program at the Joint Center for Housing Studies of Harvard University, home improvement spending will recover and annual spending for remodeling will accelerate with nearly 5% growth for 2010.  As home prices start to moderate, home sales begin growing and the employment outlook improving, homeowners will focus on remodeling vs. buying until prices begin to appreciate and unemployment begins to drop.

“The gradual recovery in the broader economy should encourage more remodeling spending by homeowners,” says Nicolas P. Retsinas, director of the Joint Center for Housing Studies. “This year could produce the first annual spending increase for the industry since 2006.”

The Remodeling Futures Program, initiated by the Joint Center for Housing Studies in 1995, is a comprehensive study of the factors influencing the growth and changing characteristics of housing renovation and repair activity in the United States. The Program seeks to produce a better understanding of the home improvement industry and its relationship to the broader residential construction industry.

Foster Pointe Senior Homes, a 61-unit three story affordable senior development located in the Brooklyn Centre neighborhood on Cleveland’s west side, announced that it will be ready for occupancy mid-summer 2010.  Brooklyn Centre is a walkable neighborhood with a number of parks including the renowned Cleveland Metroparks Zoo and the Ohio and Erie Canal Towpath Trail. The community’s units boast one and two-bedroom efficient floor plans that connect kitchen and living room areas to create a large, open living space, with all floor plans providing a breakfast bar.  Foster Pointe includes numerous environmentally friendly development features, including upgraded insulation, energy efficient windows, Energy Star appliances and an advanced light package.  Foster Pointe exceeds the Enterprise Green Community Program Standards, a national standard for green and environmentally healthy affordable housing.

“We’ve been incorporating green components for several years and that includes Energy Star certification for many of NRP properties. We are attempting to improve the quality of people’s lives and not charge them extra for it,” says Aaron Pechota, Vice President Development, The NRP Group.

What kind of income is necessary to afford a modest rental home?  According to a recent report by the National Low Income Housing Coalition, that number is $18.44 per hour or $38,360 per year.  The report highlights that rents are continuing to rise while wages stay the same or decrease across the country.  The national two-bedroom Fair Market Rent (FMR) is a $959 a month and 74% of metro renters live in an area where having two full-time jobs at the minimum wage would still not allow them to afford the two-bedroom FMR.

Other key findings from the 2010 report include:

·    The two-bedroom Housing Wage topped $20.00 in 10 states: HI, DC, CA, MD, NJ, NY, MA, CT, AK and FL.

·     In 2010, the estimated average wage for renters in the United States is only $14.44, a decline from $14.69 in 2009.

·    At the federal minimum wage of $7.25, a household would have to work 102 hours each week to afford the nation’s average FMR for a two-bedroom home.

·    There is no county in the United States in which a full-time minimum wage worker can afford even a one-bedroom apartment at the FMR.

“Out of Reach 2010 shows once again that prevailing incomes and wages are simply not enough to allow a family to afford a decent home in their community,” said Sheila Crowley, President of the National Low Income Housing Coalition.

“The persistence of high rates of unemployment and under-employment is making it ever more difficult for families to secure decent housing. Unfortunately, the situation is not likely to improve any time soon,” Center for Economic Policy and Research Co-Director Dean Baker said.

“[NLIHC’s] Out of Reach annual report on rental housing affordability shows a growing need to preserve and expand the current stock of affordable rental housing,” House Speaker Nancy Pelosi (D-CA) said. “The hardships faced by many low income renters in an economy recovering from the recession and record foreclosures make this need all the more urgent. We are grateful for NLIHC’s efforts, and we will continue our partnership to ensure that more Americans have better access to decent and affordable rental housing.”

Extensive data for every state, metropolitan area and county in the country are available online, at www.nlihc.org/oor2010/.