NIC Notes

Insights in Seniors Housing & Care

By: NIC  |  February 28, 2019

Insights on Collaboration – Session Highlights from “The NIC” in San Diego

Senior Housing  |  healthcare  |  medicare

Focused on the theme, “Investing in Seniors Housing & Healthcare Collaboration, the 2019 NIC Spring Conference kicked off on Wednesday afternoon, hit full-speed Thursday, and concluded with a full morning of networking and informative sessions on Friday. The Conference drew more than 1,700 attendees, including investors, seniors housing and care operators, and healthcare players, many of whom were exploring new opportunities to collaborate across old silos. 

Among the many educational sessions, there were plenty that focused on various aspects of collaboration in a value-based world. Here are just a few of the highlights from the sessions that focused on healthcare and seniors housing and care collaboration. 

The NIC Conference opening panel “Underwriting Health Care in Private Pay Seniors Housing” used the story of Mary, a fictional seniors housing resident, to illustrate how the broader health care system is starting to impact seniors housing net operating income (NOI).  By increasing length of stay and by providing medical care in a lower-cost setting versus the hospital, the community realized a 20% increase in net operating income with Mary participating in the medical services revenue model. 

How realistic is this? John Rijos of Chicago Pacific Founders, and Chris Winkle of Sunrise Senior Living, shared their real-world experience with Medicare Advantage plans, and said it is very realistic.  Jerry Taylor, of Solera, had not yet implemented a MA plan, but agreed with the concepts.  And all panelists agreed that communities risk being “disrupted out of the business” if they’re not on board. 

The opening day’s final session, “I-SNPs: Why Providers are Becoming Payors in a Value-Based World” addressed the question: Is setting up a Medicare Advantage plan for residents the right strategy for your company? A panel of experts, already involved in that process, discussed I-SNPs, or Institutional Special Needs Plans. These programs provide Medicare coverage for residents of long-term care facilities.  

“The process is complicated,” noted panelist Steve Fogg, CFO at Marquis Companies, a provider based in the Portland, Oregon, area. Marquis already has 500 long-term care residents in its program, not all of whom live in Marquis buildings. Panelist Lynne Katzmann, CEO of Juniper Companies is putting together a plan for assisted living residents that will be rolled out next year. Peter Longo, principal & managing partner, Cantex Continuing Care Network, commented: “Find a good insurance partner. That’s key to success. 

Day two launched with the highly anticipated breakfast keynote given by former Speaker of the House, Paul Ryanin his first public address since leaving Capitol Hill last year. He gave an encouraging perspective on the state of the U.S. economy, listed Congress’ accomplishments of the last few years, and reminded his audience of 1,500 decision-makers in seniors housing & care of the enduring strength of the American system of government – and the American dream. He also was critical of those in Washington, D.C. who employ divisive politics, rather than working together, across the aisle, to seek solutions. He spoke of the “entertainment wings” at the extremes of both parties, as opposed to the “doers.” 

In the following fireside chat with John J. Kelliher, the conversation turned to policy, and what this sector should look for in the coming few years. Among a host of topics of interest, the two policy experts discussed how Medicare Advantage programs will continue to grow as we move towards a value-based system, and the need for innovation in the private sector.  

In the lunchtime keynote, Futurist Ian Morrison compared health care in the U.S. to single-payor systems in other countries. “We don’t get much more stuff for our health care spending, we just pay much much much more for it,” he said.  The average American family cannot afford to pay the annual premiums on the average American health insurance plan.  And for many health systems, Medicare and Medicaid pays for 70% of the patients, but private insurance payments generate 70% of the profits. 

So how can we fix our broken system?  Technology will allow for greater population segmentation. Risk-sharing payment models will incent players to get smarter and more efficient.  Data analysis will allow us to focus on the 5% of patients who account for 50% of all spending, and payors will increasingly cover non-traditional services – including housing and other social determinants of health – to keep these “frequent fliers” out of the hospital.  

In a follow-on conversation session after his keynote, Morrison continued his comments on the U.S. healthcare system.  He pointed out that shared savings plans can be problematic for companies that only offer a single service – for instance, a standalone SNF – because if your great work keeps people healthier longer and consequently generates savings for their hospital, you may not see any value from that work.    

A long-standing debate is whether senior living is a hospitality or healthcare model. But it’s both, said panelists at “It’s Not Room Service, It’s Healthcare…Or Is It? Forging Partnerships in a Value-Based World.” New technology and new building design are bringing together the two concepts. Panelist Maria Nadelstumph, Brandywine Living, said, “We provide beautiful amenities and a lifestyle, but also care. It is the perfect marriage of hospitality and healthcare.” 

Those considering taking on healthcare risk gained deep insight through facilitated small group discussions – and the experience of Lynne Katzmann and Anne Tumlinson – in the “Path to Healthcare Risk: Do You Have a Decent Roadmap and Proper Footwear?” session. Tumlinson challenged attendees to ask themselves some tough questionsHave you done enough work to understand the risks, what it requires, what the responsibilities are and do you have the leadership and culture to support the changes you need to put in place?” Katzmann walked through all the critical elements that impact success when taking on risk, in a brass-tacks session designed to help those considering “taking the leap” to understand what they are getting into  and to gauge their readiness for such a move. 

Panelists in the “Medicaid Managed Care in Seniors Housing and Skilled Nursing: Opportunity or Threat?” session said that Medicaid Managed Care represents a significant opportunity for assisted living companies to generate new revenue on the services they currently offer – but for the same reason it is a significant threat to skilled nursing, as people migrate to lower cost residential settings. 

Over the last decade, payors have steadily pushed more and more risk onto providers, and are actively seeking partners in the seniors housing industry who will accept some of that risk.  In “Beyond the I-SNP: Future Opportunities for Participation in Value-Based Care” panelists cautioned that you need to prove your value through data and outcomes, to gain a seat at the table. 

Strategic up- and downstream networks are critical for survival for post-acute providers, panelists at the Post-Acute Survival Guide session said. Payors and hospital systems use data to select those they invite into their networks, and operators must “lean in” and engage with them for continuous improvement.  

The session, “Implications of PDPM for Skilled Nursing” drew an engaged audience of investors and operators eager to understand the ramifications of the new Medicare reimbursement system. PDPM represents a real opportunity for the best SNF operators to weed out weaker competitors along the path to full capitated risk-sharing, said speaker Steven Littlehale of PointRight. But RNs and therapists must be encouraged to “think clinically” rather than just clocking minutes of therapy. 

Now back from the conference, NIC staff are processing a wealth of audio, video, and presentation materials for the use of attendees. In the coming weeks, visitors will be able to view and download curated material derived from some of the conference sessions described above.

About NIC

The National Investment Center for Seniors Housing & Care (NIC) is a nonprofit 501(c)(3) organization whose mission is to support access and choice for America’s seniors by providing data, analytics, and connections that bring together investors and providers.

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