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Miserable useless burden, is perhaps my best description of most of the rules and regulations that accompany receiving government payments for senior care (assisted living, skilled nursing) . That being said Occasionally these programs can provide some unexpected benefits for seniors and those who serve them. Last week I spent some time talking with Mark Cimino, the CEO of Cimino Care a Sacramento area based regional assisted living provider. Here is the story he told me.
He was offered the chance to lease River Fountains of Lodi a 52 room assisted living community. Lodi is located in the California Central Valley and is famous for growing wine grapes and a Creedence Clearwater Revival song. At the time Cimino Care assumed operation of the community it had an occupancy of around 70%. This does not tell the whole story though because 33 of the residents were receiving Supplemental Security Income (SSI) benefits which paid the community just $980 per month. The 10 private pay residents were paying rates of less than $1,500 per month. It gets even worse though, because the community was under targeted supervision by the state.
Finally, because of the low monthly revenue stream physical plant was in disrepair.
The first task was to get right with state licensing. This required a substantial investment in the physical plant and a significant number of staffing changes. As important as the staffing changes was a significant commitment to staff training. The next step was to implement a fresh marketing program, telling a highly skeptical and distrustful community that things have changed. This involved more than just telling the story, it required getting to know the community and inviting them come and experience the new River Fountains. As they began to tell and demonstrate their story, additional private pay residents began to trickle in.
The Magic Bullet – Medical Waiver Program
Mark knew going in, that River Fountains was an ideal candidate for the California State Waiver program. Under this program, residents who require intermittent nursing care that would have historically “forced” them into skilled nursing at a cost to the state of around $150 per day are allowed to be admitted into an assisted living community that provides the required nursing services. Under this program the community receives an additional $50-$80 per day saving the state typically $100 or more per day. In order to participate in the program several things had to happen.
1. They were committed to not evicting any of the existing residents in order to make room for higher paying residents (not a requirement by a philosophy).
2. They then had to go 12 months without a single serious licensing infraction. They were able to accomplish this in 14 months.
3. The application process took another 3 months. Today the community is above 90% occupancy and it’s reputation in the local community is continuing to improve. This is not a program for every troubled community. The community needs to be in the right state and in the right county.
Even then, many communities have an operating cost structure that exceeds the $2,500- $3,500 per month that River Fountains receives. All that being said, there are communities where this program and programs like it can make a real difference for both the residents and community owners.
Finally, I am extremely cynical about the effectiveness of the government to do much of anything, including providing senior care. This is one case where they have done something that is very creative and benefits everyone. Do you have other examples where revenue can be enhanced to make a difference in lives of residents and the communities they live in?
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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.