Part 1 of two part series about the escalating gap between what aging boomers want/expect and what they can afford.
By Steve Moran
I have written a number of articles about the escalating gap between what aging boomers want and expect vs. what they can afford. In truth, it is a problem that goes way beyond senior housing. It is a problem that threatens to implode the federal budget in the coming years.
Because it’s an issue I am passionate about, I am always on the lookout for people who are thinking about and working on this problem. I am looking for people who have ideas as to how we can find a way to create a senior housing community on a Yugo* budget and where seniors can live a Mercedes lifestyle. A few weeks ago, someone in the industry (sorry I forgot who, or I would give credit) told me to go Google some guy named Jeff Petty and SHIFT — “Senior Health and Housing Initiative for Transformation” — because he has some workable, simple, viable ideas on how to crack this this problem. I found him and last week we had a fascinating conversation.
The Challenges
Jeff is the CEO of Wesley Enhanced Living, a not-for-profit faith based, CCRC operator in Pennsylvania. They provide senior living services to more than 1,200 residents in 9 communities. He has a burning passion for solving the cost problem. Here is how he sees the problem:
- The current CCRC model only serves seniors above the 70th or 80th percentile of income and assets.
- Particularly because of declining investment returns, seniors — even those who are able to afford the current CCRC model — face the very real problem of spending down their assets.
- Running out of money before running out of life is the most persistent fear seniors have.
- For virtually all seniors, getting appropriate health and wellness services is a bit like having to buy a new car, one part at at time, then having to take all those parts home and assemble them yourself or with the assistance of an expensive consultant.
- The current senior housing/senior healthcare model is frightfully complex, expensive and costs are growing much faster than the economy.
- As the system exists today, there are no serious incentives to reduce costs. You might even be able to make a case that the incentives that do exist, result in increased costs.
- The focus of the current system is almost entirely on repairing old frail broken bodies rather than preventing problems.
- There are huge gaps in the payment system.
SHIFT Goals
The broad goals of the SHIFT concept include the following:
- It is better to prevent disease and life sapping conditions rather than putting all our resources into treatment after the problems have become a surfaced.
- It is impossible to realistically address senior healthcare issues unless the solutions are linked with senior housing.
- Any approach needs to comprehensive/holistic.
- It is possible to create a model that feels like a Mercedes and costs even less than a Yugo.
- Solutions will require traditional provider sources and payor sources to think outside the box. These players will need to be willing to sacrifice their traditional turfs to achieve a better quality of life for seniors.
- The solution needs to be targeted squarely at the middle class.
SHIFT does not yet exist in real life. There is a huge resistance because it is different. You can check out Part 2 of this article, which outlines the specifics of what SHIFT would look like in real life and how it would be paid for.
Questions for you, the Reader:
I want to close out this article with a couple of questions:
- How does Jeff’s description of the problem fit with your view?
- What do you think of the goals? Are there things missing? Are there things you think should not be in that list?
* In case you don’t remember the Yugo is often referred to as the “Worst car ever made”. Jokes abound such as: Why does the Yugo have a rear-window defroster? So you can keep your hands warm while you push it. You can read more here.
Some Past Articles on this subject:
- Why We Are Doomed to Mediocrity in Caring for Seniors!
- The Hospital’s Best Friend . . . Part 1: How we got here!
- The New Healthcare Paradigm – What It Might Look Like
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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.
Unfortunately the issue of champagne tastes on a light beer budget will not leave this world for many generations.
I’m looking forward to hearing how this potential solution will play out and am interested in how you think the current senior living operators will respond.
After reading this article I found out to my satisfaction that they are people in the industry to think and feel the same way I do.
Without sounding negative the current system only applies to a few seniors in the 80’s and 90’s with assets, after a long life of sacrificing and saving they found out that that money which originally was intended as inheritance to their children and grandchildren is going to be used for their own medical needs.
There is a sense of frustration and resentment.
The reality is that this demographics is dying.
The need has to be focus on the next generation which are the spenders.
with not as many assets left.
Some of them are supporting their children who lost their jobs and paying for college educations.
So, the” Mercedes style of living with the Yugo budget” has to be consider for the future development of the industry.
Hi Clara
I appreciate your comments and I guess the one thing no one is really talking about is the reality that we “Boomers” may in the end not be able to get everything we want.
Steve
From LinkedIn Groups
Group: California Association of Health Facilities
Discussion: Yugo Budget & Mercedes Taste – The Boomers Senior Housing Conundrum
I believe that the aged are going to be staying at home longer and sicker than in past decades. Families will be doing more care for an extended timer. Elderly spouses will age more quickly under the strain and there will be an increased need for technology that assists with individual family needs as the care challenge evolves.
All of this may seem a bit self serving since we offer a product that we call the ALZdEFENSE system and the FALLdFENSE system. The product is the same but the primary use changes from helping with Alzheimer’s behaviors to helping with fall risk as might be the case with a recent stoke patient. In effect the product is a bed/chair exit monitor that signals an out of sight family member carrying a remote, allowing the caregiver to rest or work almost anywhere in the home. It reduces concern and worry on the part of families and caregivers and can delay caregiver burnout. The product is also very affordable when compared to even one day in a care facility.
Posted by John Brasch
From LinkedIn Groups
Group: Boomers: Aging Beats The Alternative
Discussion: Yugo Budget & Mercedes Taste – The Boomers Senior Housing Conundrum
As a daughter and care giver to my 91 year old mother, I contemplate what is going to happen when I can no longer care for her in the home. The cost in CA is enormous and even though she had a long term care policy, it only pays half in a six bed or about 60% of a skilled nursing facility. She has been in a SNF 4 times. I saw first hand what a 15% cut did to the facility and can’t even imagine what will happen if the 27% cut goes through. Where will people go who can’t take care of themselves?
Posted by Christie Russell
From LinkedIn Groups
Group: Boomers: Aging Beats The Alternative
Discussion: Yugo Budget & Mercedes Taste – The Boomers Senior Housing Conundrum
I agree that we have a looming problem of seniors who need care and can’t affor it. Taking care of yourself as you age is one step, but still there will be many who will need assisted living who will not be able to afford to pay for it. I see if less as a “taste” preference and more as a “need.” It does not yield to simple solutions.
Posted by Lorie Eber