Kendal CEO: Covid-19 Could Drive Permanent Wage Increases, University Partnerships

Senior care providers across the country are offering hourly wage increases, overtime pay and other incentives to encourage front line employees to continue providing care to residents during the coronavirus pandemic.

In the process, this may be establishing a new wage baseline, Kendal Corporation President and CEO Sean Kelly told Senior Housing News. Senior living providers have an opportunity to attract and retain new talent. But to do so, they must be willing to pay up for workers that are rightly being held in higher esteem.

“We’re seeing the dynamism of senior living. Being a leader or a manager or a [care] provider [is] being better understood and held up higher,” he said.

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Higher wages are not the only thing that may define a post-Covid landscape. The outbreak may also signal a slowdown of new senior housing developments in dense urban cores and mixed-use settings, and accelerate intergenerational developments on college campuses through university affiliations. Colleges, meanwhile, may be more amenable to pursuing affiliations if enrollments take a post-pandemic dip.

“I think that schools may see a different kind of an opportunity or see the opportunity differently than they’ve seen,” Kelly said.

Based in Kennett Square, Pennsylvania, Kendal’s portfolio includes 13 affiliated continuing care retirement communities (CCRCs) in seven states.

Kelly discussed how Kendal’s federal model of affiliate CCRCs has held up as the pandemic continues, operational pressures and promising testing partnerships, and what he envisions in a post-Covid landscape.

This interview has been edited for length and clarity.

How are Kendal affiliates and the central office responding to the outbreak, after nearly two months?

What the affiliates have been able to do has been extraordinary. We have seen the virus in a handful of the Kendals, but we haven’t seen any outbreaks as they would be commonly understood. We’ve seen people be so damn thoughtful, vigilant and in ways resilient.

We started working on [our Covid response] as a system in late February. And in the first week of March, the system was coming together, [affiliates were] sharing concerns and ideas and wanting to build systems that would enable us to stay connected because I think we foresaw that this was going to be very different.

A common reaction was, we know how to deal with the flu when it comes through every single year. A lot of the means and methods that were being put out by the CDC were consistent with the things that we would do on a normal basis in a rough flu season. That was all stuff that we understood and it gave us a little bit of confidence to put our heads down and begin to think about how those kinds of methods would need to be amplified and extended in the case of a pandemic.

My view is this virus has clarified and amplified some of the things that the marketplace is wanting to respond to.

Kendal Corporation President and CEO Sean Kelly

Having said that, what’s come through obviously is far different than anybody could have imagined, and the ability of our system to endure that came a little bit from having that confidence that I think our field enjoys to some extent. [Also,] having a collection of really, really strong leaders and strong staff and resident-staff culture that really enabled us to to take on the idea of planning for the best way to confront this virus — not one person at a time, one affiliate at a time, one discipline within the affiliate at a time, but as a community.

How has Kendal’s federal model withstood the additional pressures brought on it by the outbreak?

We have activated our network in ways that we’ve only talked about previously. We’ve activated the means by which we do centralized procurement. The work around [acquiring] PPE and having everybody able to get a hold of the stuff that they needed was absolutely aided by our ability to amplify the essential nature of our procurement platform that we’ve been working on now for about a year and a half.

But the most important thing that we’re doing [is] we’re sharing stories — how testing is working, how is the advocacy for testing in a local community? What antibody tests seem to work better than others? What things should we be chasing?

When it comes to means and methods and partnerships [and] the possibility of mass testing, how do we see our residents connecting with one another? How do we take advantage of the inspirational moments where someone steps up and wants to do singalong at seven o’clock at night and sings God bless America across a community that is spread across 200 acres in Hanover, New Hampshire? Those things happen at each Kendal community are shared, and very often inspire new things to happen in other communities. And that’s been a real benefit for us.

Our communication stream is unbelievable — the ways in which the affiliate teams have been able to communicate with staff, residents and member stakeholder groups during this period of time is something that makes me most proud. Because I know the energy it takes to get something out the door every day to answer the hardest questions to deliver.

Have Kendal affiliates been able to leverage existing health system relationships for feeling better or access to testing?

One specific example is Kendal at Ithaca [New York], where the local hospital, Cayuga Medical Center, is affiliated with the Mayo Clinic.

The Mayo Clinic, along with colleague organizations around the country, are taking some leadership on the development of testing. More importantly, organizations like ours being first or second in line to be able to access testing for our staff, our residents and for our members, I think is more important now than ever.

We’ve seen people be so damn thoughtful, vigilant and in ways resilient.

Kendal Corporation President and CEO Sean Kelly

They are going to be undertaking an exercise to provide for mass testing at Kendal, because it’s not just about the test. It’s also So that what do we do with this information.

Right now, we don’t have an ability to get wholesale test results in our environments — or almost in any environments — because there’s a lack of credible, reliable testing that is accessible to large groups of people. The question that we’re trying to answer now, assuming that the testing will become more available, is how will we behave.

We at Kendal are spending a lot of time and energy trying to hold up the importance of getting to the testing and hold up the importance of our sector in particular having access to it. We also know that to the extent that we can do a better job of forecasting and caring for residents on our campuses and keeping them out of the health system, if we are indeed flattening the curve, doing our part of how we keep it flat is avoiding unnecessary outbreaks in communities like ours.

We want to keep our folks home and safe and understand who has more or less risk as they come on and off of our campus, at some point in time when we start to move into a new normal period.

We also know that keeping ourselves safe will have a very direct impact on the abilities of all of our related health care systems to recover and sustain their operations at a more normal level that will hopefully allow for us as a society to take the time to live in a different way, during this period of time before a vaccine may be developed, which could be 15 to 18 months from now.

How adversely has the crisis impacted sales and marketing efforts?

Our experience has been [similar] to what the rest of the world is experiencing right now. We’ve had a slowdown in move-ins in large part because folks are either not selling their houses, or if they were to move in, there would be a quarantine period that they would rather avoid.

We’ve had more people in our existing lead databases wanting to know what are we doing in response to the virus, are there any openings, and how can they learn more about moving in. We pay a lot of attention to that as do all of our colleagues in the field.

Our means and methods for meeting folks that are considering joining Kendal, either as a resident or a member, are different [now]. We’ve been leveraging technology, and other platforms are put to really good use. We’re meeting people both one on one and in medium-sized and larger [virtual] group settings. We’re seeing folks that are on our waitlists and folks that are in our lead base actually coming together as a community before they even move to a Kendal, so we’re actually seeing immensely increased interaction across our lead base more than we’ve ever seen.

How are cash reserves and lines of credit faring, and how will you be addressing those moving forward?

We are developing some different scenarios around what might happen, depending on how the economy performs as we move out of this period — hopefully over the next six to nine months. [We’re also] dusting off some of the tools and techniques that we developed over the course of the [Great Recession]; whether or not we need to put them in place is to be determined.

We’ve got a body of work that we believe we can build from that can help address economic concerns, should they occur. More importantly, we’re paying more attention to the things that really seem to touch people, meet them where they are and inspire them. That has everything to do with connectivity and community.

“We’re seeing the dynamism of senior living. Being a leader or a manager or a [care] provider [is] being better understood and held up higher.

Kendal Corporation President and CEO Sean Kelly

As an organization, we have affiliates in different places when it comes to [cash] reserves. Some are extraordinarily strong and some are carrying a higher debt load and are new in terms of coming out of the ground, some have refinanced, some are in markets where competition has increased.

We’re not seeing [financial stress] as a result of Covid at the moment any greater risk or strength coming from it directly. We have done a good job at being thoughtful about stewardship and managing resources to the extent that they are available in ways that are responsible and I think that that has definitely mattered … some of the Kendals have sought the loans made available through the federal government and the PPP portion of the program, and in so doing, we’re recognizing a current state of affairs that could get worse in the way of direct expenses as we muscle our way through this crisis

[Our industry is] more transparent and more directly disclosed and conversant with lenders than it used to be, which is a good thing. In every instance where there’s outstanding debt, or if there’s an outstanding loan or line of credit, the Kendals are conversing on a very regular basis with the institutions, whether it’s a trustee or bond investors or a bank.

We’re able to have communications with our investors on behalf of the system in small groups and large groups … I think the investors have been fantastic in terms of really digging in to some of the practical matters that really make operations tick and understanding the incredible stress —- emotional, physical, financial stress — that organizations are feeling right now. In every instance that I’m aware of so far, [they are] wanting to be a part of how we come out of this stronger, as opposed to wondering how they’re going to get paid as if this never happened.

Bob Kramer said in a recent interview that he sees seniors returning to more space in suburban settings and college towns once the pandemic ends, which he also believes could benefit providers such as Kendal. Do you see university partnerships making even more sense now?

I do believe that. We’ve been experiencing an uptick in that arena already.

My view is this virus has clarified and amplified some of the things that the marketplace is wanting to respond to. That has a lot to do with ongoing engagement and enrichment across the population. I’m going to call it authentic engagement and enrichment that comes along with authentic partnerships with colleges and universities.

So rather than diluted versions of learning that that can sometimes come out of more loosely held relationships or programs where our populations just kind of tag along with something that’s pre-existing, our folks are more capable of and more interested in engaging more directly with colleges and universities and really cross-germinating with the student body.

I think the colleges and universities are going to be more open to providing services more outwardly to populations like ours. I think their business model is probably going to be disrupted, meaning colleges and universities are going to have an entire semester, if not two, that prove that folks can receive value from learning without having to make the gigantic investments that they’ve made previously.

How else do you see the landscape changing after Covid-19?

The other big change is how exemplary I think some of the leadership has been through this, in the face of what is absolutely unimaginable in many cases. We’ve got frontline staff that are bringing it every day in the face of the highest stakes that they’ve ever worked under and in conditions that they never signed up for. They’re bringing more love, more compassion, more care, more professionalism, more commitment to the vigilance that has to go along with donning and doffing your PPE, appropriately cleaning up after yourself and cleaning yourself more than you ever might have guessed.

Bob [Kramer] wrote this article about how we’re seeing the heroes show up. Those heroes have always been there. They’ve always been doing the work and they’ve always been held up. We as a field have an obligation to hold up the people that are actually doing this work that is so cherished day to day, often by folks that are older, and in some cases, in their most vulnerable, confused, compromised and fearful conditions.

We see that a lot in the coronavirus, but we’ve seen that a lot in our health centers all along. So coming out of this, my hope is my expectation is, to speak to this hope and help make it happen.

We’re not spending huge dollars in areas that would really start to not just bend but potentially break you — agency and overtime. At the moment, we’re instituting hero pay and across the Kendals, there has been a significant amount of productivity in the way of … staffing patterns, models and staggered shifting. That has helped us in keeping staff relatively intact. These are dollars that are well earned. And in some ways, it’s what we must do in order to meet the market where it is and keep folks inspired, coming in and doing this work.

There is a possibility that that market could change. That’s one area of expense that I think we’re going to have to get used to in the new normal.

Coming out of this my expectation is to speak to this hope and help make it happen: that these heroes that we’re pointing to right now are seen as such and paid as such and receive benefits and pathways for their own professional growth as such, not just calling them heroes in the moment because we made it through [Covid]. But to really change that mental model for what these folks have been doing for a really, really long time.

Consider what our sector could look like if we had our own first responders under our roof doing heroic work on every given day, and might we enjoy the spoils of that by having more people take notice of our field, more people commit to doing the work and growing into our field. If we are able to do that, we might be able to meet the needs of the future population. We might be able to do the work better than we’ve ever done it. But we’re going to have to recognize it in order to do so, we’re going to have to pay.

My suspicion is that they’re going to be paid accordingly. We’re going to have to find benefits that are flexible and acknowledge where folks are coming from more so than we ever have. We’re going to have to identify pathways for growth so that people have opportunities not just for education and professional growth within an organization, but within the sector.

We also have to commit ourselves to a style of leadership that invites and encourages and at least notices the strengths [of] our frontline caregiving teams — whether you’re in dining services or the clinic or the health center — to help make these populations special places populated with the special people that they are.

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