Senior living is in such a transformational time. The 5,200+ providers under the LeadingAge umbrella are being challenged with operating pressures and exciting growth opportunities like never before. The US Census Bureau projects that 19.6+ million 75+ year olds will be coming into our segment of the healthcare ecosystem over the next 20 years, and we need to make sure that we’re ready.
At the same time, we are having leadership turnover at a precedent-setting pace. The operational complexities in our field are not getting any less challenging, and we’re seeing an incredible shift in the payment reform paradigm, moving from fee-for-service to value-based reimbursement. On top of it all, we have margin pressures that—regardless of size and scale—are affecting everyone’s access to capital to grow. All of this is challenging providers to think differently in terms of how we’ve been running our organizations for generations.
Watch the webinar recording to learn more about how Life Plan Communities can successfully prepare for growth in 2024.
In our December 14, 2023 webinar, Ohio Living CEO Larry Gumina, Co-CEO of Greystone Communities John Spooner, Ziegler President and CEO Dan Hermann, and Love & Company President/CEO Rob Love shared their insights on how to plan for growth in 2024.
Growth Starts in the Boardroom.
I believe our ability to address these challenges effectively starts and ends in our boardrooms.
As I look across the provider landscape I am concerned. I believe an uncomfortable number of organizations have boards that are not only term-limited, but also made up of—with all due respect— wonderful people who have been friends of the organization. Regardless of industries, board teams who set effective vision strategies are those who make sure they are well educated on the industry megatrends and that they have the appropriate financial, legal, marketing and sales and over all skills sets necessary to sustain their mission. If boards are not equipped with those skills, then in my humble opinion they’re not going to be equipped to set effective vision strategies for their organizations.
Let me share my experience at Ohio Living. When I began here 12 years ago, I walked into my first board meeting with a consultant. I did this intentionally with the support of my then-board chair. The board consultant looked around the boardroom and said, “Okay, it looks like Ohio Living is caring for 75-year-old white men,” which, of course, was certainly not the case. So we challenged ourselves, and now we pride ourselves—and we hold ourselves accountable—to make sure that we have the skill sets in our boardroom to drive an effective vision setting strategies for Ohio Living.
Today, we open our board meetings with strategy discussion. I want the whole board to be part of that not just a subcommittee of the board. I believe it’s a significant part of my responsibility to educate my board of market trends and yes, the challenges and the opportunities. If I don’t regularly invite experts from various parts of the senior living field to share their vision for the industry, I’m doing my board a disservice because I’m not equipping them with the knowledge they need to make good decisions. If they’re not being exposed to the field’s trends, they’re not going to set effective vision strategies for Ohio Living.
Board Strength Affects Affiliation Decisions
Affiliations and acquisitions are certainly a hot topic in senior living, and Ohio Living is no exception. We get many opportunities, but in deciding whether to partner or affiliate with an organization, their board strength and vision is an important factor. We have turned away partnership opportunities from organizations that are filled with great people doing God’s work, but they have major challenges. They’re in challenging markets, or they’re in challenging financial positions.
If I were to bring in a community that would require a significant capital expense to bring them up to market, then I’m inviting a distraction into our boardroom and even more so with my executive team. And those distractions are going to impede our accretive strategies to strengthen our mission and grow market share. So we’ve turned them away. So often these organizations have waited too long.
Board Strength Leads to Successful Growth of Home and Community-Based Services
I believe one of the best examples of the impact a strong board can have is how Ohio Living has grown its home and community-based services (HCBS). We worked hard to educate our board on the different growth opportunities in the field, and as an organization we decided to place a strong emphasis on HCBS.
The board recognized that our healthcare system is moving from fee-for-service to value-based reimbursement. The federal government said that by 2030, they want every dollar that comes out of the Medicare hospital trust fund to be in an accountable plan. Again, we have this aging population right in front of us, so Ohio Living has aggressively prepared to expand HCBS through partnerships. We are positioning Ohio Living creatively to work with others to care for that population, other providers in other markets that also want to go beyond their campus community and start relationships earlier on and insurance providers, too.
In addition to our 11 campus communities, we’re generating over $70+ million in revenue in our HCBS footprint, serving over 51 Ohio counties, up from fewer than 30 counties 12 years ago. We are hitting record high census levels in our Medicare certified home health, hospice and palliative medicine verticals. We also have a physician service and nurse practitioner joint venture with Curana Health—that provides primary care to residents on our campus communities and throughout other Ohio markets. These care lines are allowing us to reach beyond our campuses and into the communities.
As we’ve grown market share throughout Ohio, we’ve also optimized our internal penetration of HCBS with Ohio Living. For example, I’m proud to say that 90% of the residents on our campus communities who need end-of-life care use our Ohio Living Hospice professionals. By contrast, in 2012 just 34%-36% of our residents selected our internal staff for end-of-life care needs.
As the population of those older than 75 continues to grow, and as our field gets ever-more challenging, having a strong board of directors equipped with the skill sets needed to meet their fiduciary responsibilities is more important than ever—for every kind of senior living provider. The decisions made in the boardroom can have a dramatic effect on the long-term success of organizations in offering residences, support and care to all seniors, regardless of where they call home. As you continue to invest in your organization to meet the demands of tomorrow, make sure you start in your board room!