By Steve Moran

I write this article with some level of reluctance and even fear. I know pretty well leaders in all of the companies being sued. I believe them and their companies to be honorable, caring people. I also know they are under tremendous pressure to achieve financial performance.

The Charge

The Valentine’s Day New York Times Headline: Some Assisted-Living Residents Don’t Get Promised Care, Suit Charges. The allegation is that when senior living communities do an initial assessment and then periodic assessments of care needs, that as the needs increase and charges increase it should result in higher staffing levels to provide the additional care that is being paid for.

What the attorneys are asking of Sunrise is to demonstrate that there is a corresponding increase in staffing to provide that extra care. Their argument goes something like this:

Let’s suppose an assisted living community does a reassessment of all 100 residents and determines collectively that increased care needs results in an additional $15,000 a month in charges for those residents who now require additional care.

The argument then goes, that if they cannot prove they hired additional staff, it was a kind of fraud, and the extra charges were only about making money and not about serving the residents’ needs.

The Other Side of the Argument

On the other hand, there are some legitimate counter-arguments we will, no doubt, see from the senior living organizations being sued. These will include:

  • That because of resident churn, the overall staffing needs of a given community do not change but how human resources are allocated do. So, by doing levels of care it keeps the costs more fairly allocated, meaning those who need more get more and to be fair, those who need less care and get less care don’t have to pay for care for others.
  • That by the time the assessments are done, the amount of care has already increased, so when the reassessment is done and charges are increased it is a reflection of a reality that has already happened, and that, in fact, the resident received extra value from the time the needs increased to the reassessment and did not have to pay for that.
  • That the senior community has extra staffing capacity already built-in, but that the senior community in effect “eats that cost” until it is needed.  

The Ultimate Question(s)

In a very real sense, specific staffing levels in a given community are not particularly relevant (except in those states that set minimum ratios), because there are so many variables and ways to deliver care. There are only two things that are relevant:

  1. Is the resident getting the care they need and, by extension, at least the level of care they are paying for? If the answer is yes, then the specifics of how it is done should be irrelevant.
  2. If a resident has increased charges because a new assessment demonstrates higher needs and results in charges, then the amount of care provided needs to have actually changed.

At the end of the day the only relevant question is this: Are residents getting the care they need and at least what they contracted to pay for? If the answer is yes then . . .


The Big Dilemma 

It may or may not be relevant to these lawsuits, but is worth some consideration. Too often senior living communities are delivering care that is not being paid for. This usually means an initial assessment was done and either subsequent assessments were not done with corresponding rate increases or, in some cases assessments were done and rates were not raised.

Then perhaps there is a leadership change of some kind or there is a directive from the corporate level to reevaluate level of care charges, and there is a big push to fix what is a real problem of uncompensated care. This could mean a significant jump in care charges, most of which would flow to the bottom line. But it would not require any additional staffing because it was all about the charges catching up to the care already being delivered.

The Bottom Line

The bottom line is that senior living communities just need to be able to demonstrate they are delivering what is being paid for or delivering beyond what is being paid for. What is really frustrating about these kinds of lawsuits, is that if the suing attorneys win or settle, they will get big fees, and senior living residents will ultimately pay those legal fees, and it seems unlikely that it will have any positive impact on care.

More likely it will make assisted living just a little less affordable and end up hurting the very people they say they are helping.