By Steve Moran

There are some brutal truths about the senior living sector that make those of us in the industry uncomfortable. Sometimes we just don’t talk about them or pretend they don’t exist. The big problem is they do exist and we would be better off to acknowledge and address this stuff. Here is my current list of 9 Brutal Truths.

1. There Are Some Bad Operators

This is my number one pet peeve. There are some folks who own and operate senior living communities who just plain don’t care very much about residents, their families, or their teams. They are all about making money.

2. There Are Some Vendors That Only Care About the Money

Again, there aren’t a lot, but in just the last year we have been approached by a small number of vendor companies about partnering with us, who clearly are only interested in extracting money. We need to out these companies. Let them go sell someplace else or better yet go out of business.

3. You Still Employ Someone You Need to Fire

Almost every organization has someone working who is like a little spot of mold making the whole organization unsavory. Often that person is really good at their job; they are just not nice people. Being competent or even excellent is not a good enough reason to keep someone who makes everyone else miserable.

The other reason overripe folks are allowed to stay is that it is hard to find a good replacement. This is not a good enough reason to not take action.

4. The Bottom Line Is Important

The truth is that every business exists to make money. It only becomes a problem when profit maximization becomes more important than people. When balanced properly, it is a wonderful symbiotic relationship, where cash flow provides the resources to care for people and incentive for investors to keep building.

5. Everyone Is Freaked Out All the Time About Occupancy

I know there are a few exceptions to this, but it is a real problem and hardly anyone feels like they have it wired. There is good reason to feel this way and you can let it drag you down or you can use it to motivate you to do amazing things.

6. We Can Have Too Much Inventory

Way too often there is this unfounded but boundless hope that when the Age Wave hits there will not be enough inventory and that everyone will be rolling in dough. It is a nice thought. But do you remember 6 or 7 years ago when the prevailing wisdom was that it was impossible to build enough memory care communities? We have painfully learned this was false.

7. Residential Assisted Living Communities Are a Threat to Enterprise Senior Living

This is a burgeoning cottage industry. Plus there are a number of organizations that are doing it at scale. More is coming. They have two things going for them. The first is that it really is home-like. The second is that if one needs near-constant supervision, it is achievable at a much more reasonable cost.

8. There Is a Not-for-Profit (NFP) Difference

First, not-for-profit is a tax status and nothing more. There is one not-for-profit CCRC that openly states they are NFP so they can skip paying taxes and do more for residents. There is simply not much evidence that the NFP provides better value. There are some great NFPs out there and, if that is you, then hurray. There are also some great for-profits out there. There are some not-so-great communities and operators in both categories as well.

One last rub, (and I know this will get me in some trouble) is for-profit nursing homes provides about 85% of all Medicaid beds because not-for-profits are disinterested. This seems inconsistent with the idea of a noble purpose of serving older people in need.

9. There Is Too Much Sameness in the Industry

Just today at lunch a friend and I were talking about four senior living communities that are within an 8-mile radius of where we were eating. Neither of us could really figure out if any of them had a unique value proposition. This might be the greatest opportunity senior living has.

That’s my list. What would you add to it? Which do you disagree with?