I keep hearing the same theme over and over again at every senior living conference . . .
By Steve Moran
I attended the PointClickCare (a Senior Housing Forum partner) User Conference — a great experience — and once again I heard the same theme that I have heard over and over again during the last few months of attending senior living conferences:
“Hang on for 3 or 4 or 5 years and all our occupancy troubles will be over.”
The big idea is that demographics will solve both skilled nursing and assisted living occupancy woes that we are currently living.
I think it is a false hope and here is why:
Remember Memory Care? I can remember maybe 4 or 5 years ago when everyone (well almost everyone) came away from the NIC fall conference giddy about memory care . . . the problem was huge and growing. It was going to explode. The conventional wisdom was that it was IMPOSSIBLE to build too many memory care communities.
We now know that it is possible to build too many memory care apartments and communities.
Specifically, with respect to skilled nursing, there are simply too many beds and too many buildings. Most are old and not at all attractive. It would be impossible for you to find a single person who is looking forward to living their last days in a nursing home (okay, I am sure there are some).
Nursing homes are expensive and will continue to get more expensive as labor costs outpace the rest of the economy. The government will continue to look for new ways to provide care at a lower cost. This may be the most compelling reason for the government to fund more assisted living.
Assisted living, in my view, is a little more of a maybe. But again, we see continued high interest in developing new product and for the most part, each one is more expensive than the last. We are also clearly heading toward a staffing problem that will force wages up.
Even Worse . . .
Even worse is that having a “hang-on-for-the-market-to-change” attitude makes it much harder to actually do anything different today. I continue to believe that in almost every market, any community can hit 95% occupancy or better. It takes the right culture and telling the story the right way.
If your attitude is “The Age Wave Will Fix It” then so much opportunity is lost.