In Part 1 of this two part series, I outlined the expanding senior housing/healthcare crisis as described by Jeff Petty. In Part 2, I cover what this model might look like in real life.
By Steve Moran
In part one of this two part series, I outlined the rapidly expanding senior housing/healthcare crisis as described by Jeff Petty (a view I largely agree with). That was the set-up. This is the fun stuff: what this model might look like in real life.
Imagine having a conversation with your mom or dad about retirement and money (the number one concern of seniors), or maybe you are a boomer like me and you realize there are not so many years left until you hit that traditional retirement age of 65 and you know, you don’t have enough money to see you though the rest of your life in the senior housing community you work in or around.
SHIFT CCRC As It Could Be Today!
But there is hope, because you have heard about this newly opened SHIFT senior community that promises to make the “running out of money” problem go away. You are not real excited about moving into a community with a bunch of old folks, in fact your dream had always been to retire in your own home that is free and clear, but you are now realizing that dream may not be possible. You reluctantly decide to check it out.
- You discover a campus that feels a bit like a college, but with individual apartments of varying sizes and prices.
- As you walk around you, realize that while there are some old and obviously frail seniors, there are also a lot more, people who look pretty much like you.
- Digging deeper, you discover there is a physician, nurse practitioner, or physician’s assistant on campus 24/7. Even better, if you are sick or unable to get to the physician’s office, they will come visit you.
- They have more than just doctors; they have physical therapy, a small laboratory and an x-ray suite.
- You still wonder what day-to-day life will be like. You discover there is so much more than Bingo, Birthdays and Bible Study. There are classes, and service clubs, golf outings, shopping trips, multiday excursions. They even have 70’s and 80’s classic rock playing in the dining room.
Making the Dollars Work
Convinced you or your parent’s couldn’t possibly afford this? With great hesitation you ask the big question:
“How much does it cost?”
They tell you it is affordable . . . that even if you still owe some money on your house and only have social security plus a tiny retirement plan that generates just a few hundred dollars a month, they can make it work for you. The community then goes on to explain that if you have something over $100,000 in equity, that you can use as a buy-in, you are well on your way. You then wonder about the monthly payment and they explain that if you and your wife are receiving maximum Social Security that will be enough. Then you ask the other big question, what if I get really sick, how will I pay the out-of-pocket medical expenses? They explain, what you are getting is more than just housing, meal service and activities. The community will become your insurance company; they will become the payer of last resort. They will require you to assign your Medicare benefits to the community, just like you would for a traditional senior HMO, and that if you ultimately spend down the principal of your little pension plan, you will also assign your Medicaid benefits to the community. In return, the community will make sure you get home health if you need it, assisted living if you need it, memory care, skilled nursing, hospice and even acute hospital care hospitalization. The goal is to remove the uncertainty. The goal is to give you Mercedes care with a Yugo budget.
Why it does not exist today
It doesn’t exist today, because it does not fit neatly into today’s Medicare/Medicaid system. There is no mechanism for this hypothetical CCRC to be able to have Medicare/Medicaid payments assigned to the CCRC in return for going 100% at risk for housing, nourishment, wellness and healthcare. Jeff Petty has spent time and money having studies done that demonstrate a 20%-50% savings from the traditional model of providing housing and healthcare to seniors and yet to this point no one in the federal government is willing to stick their neck out and give it a try. In the meantime the federal government has invested hundreds of millions in the great ACO experiment which to date, has demonstrated no meaningful cost savings and no improve in patient quality of life. The government has spent billions on the Medicare Advantage program and the most recent data suggests that rather than saving money it is costing the government more. All Jeff is asking is for is a chance to do this as a demonstration project. Given the scope of the problem the cost is small and the potential benefit is huge. If you want details you can contact Jeff at: jpetty@wel.org
What are your ideas for solving the senior housing and healthcare crisis? What do you think of Jeff’s idea?
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Finally: If you know anyone who is looking at emergency call systems I would appreciate the opportunity to talk with them about Vigil Health Solutions.
This article totally describes what the boomer generation is looking for. If this model could be tested and works, it would be the new movement. This is what we are hearing from our seniors, and communities as wants and needs, but just as Jeff pointed out, the current pay structure does not work. I love the idea of a senior campus.
From LinkedIn Groups:
Group: Seniors Housing Transactions.
Discussion: Jeff Petty has a realistic dream for an affordable CCRC. What do you think?
we can build in Texas
Mike Tanner
email: [email protected]
Lisa your comments are right on point. It sounds like a place I would want to live.
Steve
The model sounds great but good luck with medicaid agreeing to anything –
Maybe I chose to live and run a small care home for too long in an impoverished county in an impoverished state but what about those who do not have a 100K “buy-in” and make no where near the max social security allowance? Have any studies been done for the poor and housing/care costs? This is a huge problem now and will continue to grow. In this area, it seems like the only option is to accept our physical demise, sign a DNR and pray hospice will help us all go peacefully – somewhere. It seems like gone are the days when, like in my grandmothers case, family had the money to help pay for her long -term care needs. I get calls almost daily saying a friend or family member needs 24/7 care but only has $800-$1200 a month income and no real assets to count on.
Hi Jacqui:
You ask some really important questions. I will tell you that in California, the unsung hero’s for seniors with little or no income or assets are the small 6 bed board and care homes and it only works there, because it is an owner operator.
While directly addressing the issue you raise, if we could relieve some the pressure coming the the middle class with some resources it would make it easier for the government to help those with no assets.
Steve
What a great concept! Love it…
Hey Steve – great forum!
NV does follow CA in that 6 bed homes with 4 normal able rate payers, usually have 2 “low income” residents. Sadly there seems to be more low income than able to pay. At some future point the care home industry may be looking at its own “cliff”. If Jeffs plan, which is great, could provide for say 20% of the occupancy to be low income with no “buy-in”, that would be even better.
I really love this idea. A demonstration project could be undertaken, with incentives for the organization/groups willing to develop a site etc. and this seems like a better use of funding than what we have today. The cost of one pilot is a drop in the bucket compared to the funds that flow out into the current system. Great concept, seems like society will push it, too bad we cannot start developing now so we could better understand the operations and be prepared
Hi Jeff,
Timing is everything! I am currently working with Foreign Development company looking to build or revitalize AL projects Florida. We have identified several projects and I think they would be interested in the concept as we are in high end area with many self payers.
Please contact me at [email protected].
Lisa Hartwell
Certified Investment Agent
Broker/Associate
La Rosa Realty
407-791-8825
From LinkedIn Groups
Group: Boomers: Aging Beats The Alternative
Discussion: Jeff Petty has a realistic dream for an affordable CCRC. What do you think?
The concept of SHIFT takes me back to the history of CCRC’s which started as primarily church-sponsored, charitable organizations. For a small fee (pension/Social Security), Residents were provided the care they needed over their remaining lifetime. Those organizations had to utilize their own resources or donations to cover the gap between the Resident’s income and the cost of care.
The basic premise of SHIFT is a sound one, but it requires the government to “shift” its’ policies to support the needs of the greatest number of people which could be cared for at, possibly, a much lower cost over the remainder of their lives. With funding for Medicare and Medicaid at critically low levels, and the “boomer” population exploding (pun intended), we must find a way to reduce costs and reallocate the remainder to programs which will benefit a larger number of people. SHIFT does that.
SHIFT, or something like it, offers an opportunity to serve a wider population at a lower cost,
Posted by Dave Johnson
From LinkedIn Groups:
Group: Senior Safety and Security for Long Term Care
Discussion: Jeff Petty has a realistic dream for an affordable CCRC. What do you think?
Very interesting topic. Thank you so much for sharing it. It seems like a great option for some of us ‘boomers’.
Mary Tappan OTR/L
TheraScape Design
From LinkedIn Groups:
Group: Boomers: Aging Beats The Alternative
Discussion: Jeff Petty has a realistic dream for an affordable CCRC. What do you think?
Medicare and MediCal are set up to handle acute diseases. Since dementia is a chronic disease and mostly requires custodial care, it does not fit the medical model. We need to address this!
Posted by Lorie Eber
From LinkedIn Groups
Group: Senior Safety and Security for Long Term Care
Discussion: Jeff Petty has a realistic dream for an affordable CCRC. What do you think?
Enthusiastically realistic!
Posted by Peter Hazen
Thank you for this. To expand on Jacqui’s points – we are already at the “cliff.” So many do not financially have access to ALF’s, even the small, 6-bed facilities. They often experience poor quality of life, living independently, ending up in the emergency room and hospital at a high cost, and if they survive, are sent back home to continue the cycle, or warehoused in a SNF where Medicaid will cover their care. So much could be saved if ALF and proper preventative and maintenance health care were available to this huge population, consisting not just of the “poor” but also of the lower half of the middle class. I agree there needs to be a dramatic shift, and hope those who have the power to effect change will make it so.
I wrote more on my blog, but here are the salient points…Your blog really got me going…I have had discussions about these ideas over the last year. Now if we put our collective intelligence together we can start adding pieces together and create something great.
•If we are trending towards “right-sizing” our homes, could we incorporate a hybrid co-housing CCRC (C-HCCRC) model, whereby the CCRC is an anchor point to the co-housing community as well as being a medical center for the larger community? Can home owners who live in the vicinity of the C-HCCRC (but outside of the co-housing perimeter) pay reasonable monthly fees and be part of the activities/meals/transportation that occurs within the CCRC portion of the community? Is it feasible for the residents (and community members of the C-HCCRC at large) to pay a monthly fee to cover their costs when they are in need of them as they age, similar to an insurance policy?
Imagine a pizza layout. There are co-housing units which wish to only be for seniors. Others (in Europe primarily) want to have members who are only of a certain political party, or vegans (and the list goes on.) Each wedge can be self-contained, yet still be part of the larger community. Houses are owned by individuals, sized according to their needs and financial wherewithal. Once admitted into the CCRC for their final years, they are still in the same community from which they came from.
Surveys have shown that golden boomers want transportation, activities and access to health care and family (whether it is close friends or blood relations) and more importantly, be a part of a community as they age. The C-HCCRC could to a greater degree solve those problems.
A paradigm shift will happen, whether or not we want it too. We need to brainstorm ideas and create solutions that may be outside of the box now, but will be regarded as normal as we age.
These are some ideas I have pondered about over the years I have spent within a CCRC as the Recreation and Emergency Preparedness Coordinator. I know that the present CCRC Model is the best model around for those who want to retire in a stimulating and challenging environment. Their lives are more rounded, healthier and longer due to all the amenities and services that are found within the CCRC.
Entrepreneurs will recognize the opportunities that exist if an additional model is created that will encompass the new demographic. This new model will not challenge the existence of the old; rather it will be open to far more residents and new communities within a different demographic that has not been previously tapped.
Peter you make some great points. As you allude to most senior communities operate as an island that is surrounded by the real world, and only occasionally do the two worlds overlap and interact. I think there are two reasons for this. The first is very practical and that is that land is expensive and because land away from the hub is less expensive, at least on the surface the lower cost land makes more sense. The other reason though is the idea of creating a resort experience implies it works best when we have people just like us all together and more or less exclude the rest.
Steve