Summit Vista CEO Erickson: We Want to Build Innovative Life Plan Communities Across the Country

Drawing on a deep background in senior living, Mark Erickson is the CEO and executive director of Summit Vista, the first entrance-fee life plan community in Utah. Erickson has helped Summit Vista forge an innovative partnership with health system Intermountain and attract a younger resident, and ultimately, he would like to open similar life plan communities in other markets.

“We’d like to be able to capitalize a company that can go out and build multiple large-scale life plan communities in different markets across the U.S.,” Erickson said, in the most recent episode of Senior Housing News’ Transform podcast, sponsored by PointClickCare.

Erickson knows a thing or two about scaling a senior living company, including some hard lessons: His father, John C. Erickson, was a senior living pioneer who founded Catonsville, Maryland-based Erickson Retirement Communities. Mark Erickson was COO of that company when the Great Recession hit, ultimately forcing Erickson Retirement into bankruptcy and a sale. Today, known as Erickson Living, the company is still one of the largest providers in the nation.

Following the bankruptcy, Mark Erickson spent time working on senior living projects in China. When the opportunity arose to lead Summit Vista — which is backed by three investor groups and managed by LCS — Erickson returned to the United States. The community opened its first residential building in October 2018.

With a wellness-focused model supported by the evolving partnership with Intermountain, Summit Vista is showing how life plan communities can play a role in population health while meeting the wants and needs of the baby boomers, Erickson explained in his Transform interview.

Highlights of that interview are below, edited for length and clarity. Subscribe to Transform via Apple Podcasts, SoundCloud or Google Play.

On partnering with Intermountain Health:

During our time at Erickson, we developed a pretty sophisticated health care system, and saw the benefits of that, and wanted to figure out how to replicate those capabilities as we started here. But, building it ourselves was very complicated, costly, complex, and so we reached out to Intermountain … and painted our vision.

At the core of the health care system is primary care — coordinated, comprehensive, integrated care — and there were a couple of components that I specifically wanted related to that. I wanted an on-site primary care clinic. I wanted a doctor that was dedicated to Summit Vista. I wanted appointment times that gave residents adequate time with their primary care physician, not the 10 or 12 minutes that Medicare pays [for]. I wanted same-day appointments, as people needed to see doctors. And then, the final component, I was looking for a health care system that was an integrated payer-provider, because of the alignment of incentives.

On compromises to make the partnership work:

I told you some of the things I was looking for, but we had to work within the constraints of the Intermountain system. One of the things that they said is, “We can’t justify a primary care clinic for 100 residential units for your first building. It just doesn’t pencil out.” So, they said, “Rather than use a primary care clinic on-site, we’ve got a clinic that’s a 1.2 miles away, and let’s start off by using that.”

The second thing they said is, “We can’t have a single dedicated doctor to Summit Vista, because you don’t have the patient caseloads that would justify that. So, let’s use our existing providers, and go from there.” They also said, “Listen, we can’t treat your residents different than our other patients, so we cannot guarantee 20- or 30-minute appointments with a doctor, but what we can guarantee is that, when you see your consistent primary care provider — that could be a physician, [or] it could be an advanced practice clinician, such as a nurse practitioner — we will make sure people have the time that they need with their provider, and the access when they need to see the provider.”

On the partnership today and in the future:

Intermountain is a very progressive, innovative healthcare system, and many of the things that we had on our wishlist two years ago, they have begun to adopt in their primary care model.

They have a very interesting innovation that they call Reimagining Primary Care, that meets a lot of what our goals were. They have recently moved some of their doctors from fee-for-service environments to salaried environments. They’ve created care teams around those doctors. They have a dedicated advanced practice clinician, they’ve got a community health worker. It gives them more flexibility, in terms of managing their patients, more same-day visits than they were doing under the fee-for-service environment. It’s been interesting to watch them migrate into a model that is ultimately more effective for managing the care and healthcare of seniors.

On health systems realizing that some of their high-cost patients are in senior living, and working more closely with providers:

I do think that a number of health systems are looking at their high-cost patients, and realizing that many of them are in senior living, so partnerships with senior living communities can help them manage those high-cost patients.

However, I think there’s another side, that some of the most progressive health care systems look at it differently, and they say, “It’s not just about the high-cost patients, but how do we get out in front of this, to where people are living healthier?”

What really excited me about Intermountain’s perspective is, yes, let’s manage the high cost and chronic conditions, but what we’re realizing is that lifestyle and social determinants might have a much bigger impact, in terms of health care outcomes, than does … treating a patient. So, I think the most progressive are saying, “How can we partner with communities that not only manage the high cost, but keep independent, healthy people healthy, because of the lifestyle choices that they’re making?”

On what differentiates Summit Vista from other senior living options in Utah:

Summit Vista is Utah’s first entry-deposit life plan community, so that creates a differentiation in itself. The eventual size and scale of 100 acres, 1,600 independent living apartment homes, three clubhouses, allows us to provide a breadth of services that can’t be done at a smaller community.

Some of the most exciting things that we’ve seen, in terms of attracting a younger demographic, are being talked about in the [industry], but we’ve successfully implemented [them]. Culinary arts is probably the biggest component and driver of residence satisfaction. This younger demographic wants greater choice. Choice in venues, choice in menus, choice in restaurant times.

… And then, of course, we’re seeing larger fitness centers, greater focus on wellness, and a full 25-yard short-course swimming pool. It’s the largest pool that I’ve ever built. Those are some of the components that we’re seeing the younger demographic wants … Our average age is about 74 and a half, and that’s both for people who have moved in, as well as people on our priority deposit lists, and people who’ve reserved apartment homes.

On potential future expansion:

We’d like to be able to capitalize a company that can go out and build multiple large-scale life plan communities in different markets across the U.S., as opposed to just project-level financing. It would give us more flexibility, and greater speed to market, if we’re able to capitalize a company that can build multiple of these.

On working with capital partners and LCS as a management company:

We’ve got three [Summit Vista] investors, one of which is a publicly traded real estate investment trust. Consequently, we needed a management company as part of the structure … for tax reasons. That was one reason we wanted a management company … LCS is one of the biggest, and one of the best in the industry, so having them as a partner in this project has been fantastic.

They were flexible in what the relationship looked like. I needed a nontraditional management relationship. We were doing the design of the community. We are doing the sales and marketing. I’m on-site every day, as part of the operations. I needed a management company that gave us the flexibility to control the things we wanted, but still brought a ton of resources to the table, and they do, with their information systems, finance, HR, their policies and procedures, their compliance, their training.

… Our current equity investors are three: iStar Real Estate Investment Trust, Solamere Private Equity Company, and then a local developer here, Gardener Company. They’ve been to Summit Vista equity investors, and we would love to grow with them, to capitalize a company.

I’ll tell you, it’s hard. This is a product that’s fairly unique, and so it takes a special type of investor, with the longer-term appetite, to say that they want to build these $300 [million] or $400 million projects, and the current capital markets don’t really know how to think about that. So, we are looking for additional partners, but we would love to continue with our three equity partners here, as well, to be part of a future capital structure, at a company level.

On the potential for smaller projects:

Trying to find 100 acres in these Tier-1 cities, that are undeveloped, is a real challenge. Now, there are still some sites out there, and we’ve got a couple that we have our eye on, but [a] strategic direction would be to develop a smaller scale, secondary market product, that would expand the option to bring this to more cities. We are looking at that, and think that that could definitely be a way, moving forward, to increase access, provide the same level of lifestyle.

Click to listen to the entire episode:

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