Assisted Living Unprepared for Huge Healthcare Role

Assisted living is poised to play a huge role in the healthcare system, but only on certain conditions many in the industry say haven’t yet been met. Much hinges on the ability to track and prove outcomes.

Penalties on avoidable readmissions above a certain threshold have made hospitals more careful about where discharged patients go. With assisted living growing as a possibility for that next stop, it’s putting the industry in a whole new competitive arena.

“To be competitive in the future, all of long-term care has to do a couple things pertaining to hospitals and Accountable Care Organizations, who they’ll partner with to maintain and grow referral bases,” says Ben Malakoff, director of product management for MDI Achieve, operator of electronic health record solutions company MatrixCare.


While this applies more for skilled nursing, Malakoff says, it also pertains to assisted living, as hospitals and health systems will only want to refer residents to providers in their networks that meet their standards.

That means huge potential for assisted living operators.

With the healthcare system driven toward a value proposition with greater concern attached to outcomes and spending, choosing an assisted living community might start to depend on whether it’s in an insurance company’s or health system’s network.


“It puts assisted living in a new arena it potentially hasn’t been in [before] as patients and their families [generally make the] decisions for where people go,” says Michael Murphy, managing principal at Durango Health Partners. “It will be more important for senior living centers to position themselves in a network of care.”

The assisted living industry has not been included too much in that conversation, but it should be, says Traci Bild, founder of senior living consulting firm Bild & Company.

Assisted living providers should learn what hospitals want from them and the key qualities they’re looking for, she adds. Gone are the days of ‘I like you, I like your community.’ In two years, she says, it will be more along the lines of, ‘We like you and your community… but that community over there has been tracking their outcomes.’

“You have to track outcomes in the assisted living world, because it’s going to be the future of skilled nursing,” Bild says.

The biggest way assisted living can get more involved in the changing healthcare system is to track data and outcomes, Malakoff agrees. A key metric is tracking the percentage of residents coming from the hospital that return to an acute setting. In most cases, however, communities aren’t using such software.

“We encourage everyone to have an EHR system and to meet with hospitals to see what kind of data they want to be tracked. Some just want readmission [data]; others want quality measures,” he says. “The real key is technology: it enables you to track data, slice and dice it, and evaluate it over time.”

Brookdale Senior Living is ahead of the curve in some respects, as it’s been rolling out electronic medical records across its senior living platforms for the past couple years—including in assisted living. So far, the company has completed the rollout of EMRs in its outpatient therapy and home health businesses and expects to be “pretty far along” in installing EMRs across its various product lines by the end of 2014.

“We’re in advanced pilots right now in skilled nursing, and the first phase of EMR for assisted living is likely to be automated medication administration,” said CEO Andy Smith during Brookdale’s fourth quarter earnings call.

During a January healthcare conference hosted by Stifel Nicolaus, analyst Daniel Bernstein asked an assembled panel of senior living CEOs what they thought 2014’s toughest issue would be.

Dealing with higher acuity in assisted living and healthcare reform—and how to generate revenue from it—was the universal answer given by the panelists representing the industry’s largest operators.

“They didn’t say oversupply of new construction, or cost of labor,” says Bernstein. “They all said, across the board, the implementation of technology to [be able to] have higher levels of care, and preparing for healthcare reform.”

Written by Alyssa Gerace

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