Occupancy’s Relation to “Severe Lack” of Consumer Education on Senior Care Options

| November 7, 2012

A “severe lack” of consumer education on available senior care options might be partially to blame for current senior living occupancy rates which remain a few hundred basis points beneath peaks that occurred prior to the economic downturn.

“Many consumers—especially those who have never worked in the senior living industry—think the whole industry is nursing homes,” says Sean Kell, the CEO of A Place for Mom, the nation’s largest senior care referral service. “They use that generic “nursing home” phrase to describe the entire industry.” 

Those in the industry are well aware that a nursing home is a “very specific type of property,” he continues, and there are lots of different types of care available to consumers. That’s a factor when matching seniors and their families with care services, Kell says.

“Many consumers don’t understand the difference between assisted living and independent living and an ‘elder care facility,'” he says. “Consumers love to use the word ‘facility,’ but in the industry we prefer to use ‘community’ or ‘property.'”

Thinking in terms of ‘facilities’ and ‘nursing homes’ may be having an impact on people’s choices to make a move into communities that cater to older populations. 

Across the nation, occupancy rates have crept slowly upward to an industry average of about 88.8%, according to the National Investment Center (NIC) for the Seniors Housing & Care Industry, but that’s still far below a 92.3% peak in the first quarter of 2007, before the housing market collapse. 

Lower occupancy can’t be blamed on a poor housing market alone, said a panelist during a recent webinar about the Urban Land Institute’s report on the state of 65+ housing in the U.S. The trend toward senior living residents waiting longer and longer to enter a community may actually be due to a “major shift” in consumer preference, according to Aaron Conley, the president of Third Act Solutions, a healthcare real estate development and capital advisory firm. 

A recent A Place for Mom survey revealed that only 21% of families who searched for “nursing homes” as a senior care option ended up having their loved one actually move into a skilled nursing facility. More than a third ended up moving into an assisted living community, instead, while 17% entered a memory care community. 

Even those who are aware of assisted living and search for that type of community may not be aware of other options, as nearly three in ten who searched for “assisted living” eventually moved into a retirement community. 

This data is closely mirrored by numbers from Northwestern Mutual’s recent Long-Term Care Awareness Study. More than one in five respondents (21%) were “not sure at all” what long-term care options were available to them, and only half knew that assisted living communities could be a potential solution for senior care needs. 

This indicates a “widespread” lack of knowledge regarding available choices, and it’s one of the biggest issues facing the senior living industry, says Kell. If consumers don’t know what’s available to them and are stuck with images of the nursing homes of their parents’ and grandparents’ generation, they’re less likely to want to move into a senior community themselves.

“There is a need for consumer education about our industry and the types of care that the great providers across our country provide,” he says. “The whole industry needs to do a better job of educating consumers about the kind of care that’s out there.”

The senior care referral service recently expanded its network to all 50 states by adding care advisors in Oklahoma and Florida as part of its “aggressive” growth strategy. Kell says his company, which now numbers about 250 care advisors, usually interacts with consumers “relatively early” in the process of finding senior care services to let them know what’s available to them.

“What we do more than anything else is educate customers,” he says.

Written by Alyssa Gerace


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Category: Assisted Living, Long Term Care, Nursing Homes, Senior Care, Senior Housing, Senior Living

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