Changemakers: Loren Shook, Founder and CEO, Silverado

Silverado Co-Founder and CEO Loren Shook has lived the story of change that prompted the development of a portfolio of standalone memory care communities across a handful of states. By combining medical services with the social model for assisted living, Silverado has developed outcomes-based programming to improve quality of life for those with memory impairment.

The company and its services, including its renowned Nexus program, have been studied nationally and internationally for their impact on individuals with memory care needs, and Shook has led the company since its founding.

Marked by a series of changes, Silverado’s journey has been driven by Shook and his leadership, his ability to try new things and take risks, leading SHN to name him an industry Changemaker this year.

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Are there changes that you’re especially proud of, or that have made the biggest impact, at Silverado or in the industry?

Loren Shook: Among the top things that come to mind, one is around the founding of Silverado, which really put together the concept of integrating social model living — which has a terrific value of socialization in connection with peers and a whole host of benefits from that lifestyle — with really good medical services support.

By the term medical, I mean nursing and social work and medical services, as we are serving the memory impaired population.

The dementia population typically has significant comorbidities and significant medical complications which we seek to care for through to the end of life. If we’re going to do that, then we’re certainly going to enter those areas of concern for someone’s care as well as being able to integrate with very good hospice care at the end of life, which makes a big difference.

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The social model living is terrific. No one wants to live in a nursing home, and they don’t need to, but you can’t have a good quality of life and age in place effectively unless you support that social model living with an effective and meaningful health care infrastructure. You don’t actually have to see the health care piece and that’s what we do: We hide it.

We call the place where people live a community; we don’t call it a building or facility. We don’t have nurses managing their day at a nurses’ station; they’re out engaging with the residents.

A lot of nurses will say the reason they like working at Silverado is they get to have fun with the residents because we encourage them to do things beyond nursing, to actually engage and have fun.

Another one is the philosophy of the company: love>fear [love is greater than fear]. We boil it down to eight tenets; it’s much bigger than that, but it’s a way for people to think and to make the right decisions.

The eight tenets are trust, respect, accountability, courage, transparency, appreciation, financial responsibility and purpose-driven. We’re all very familiar with the book The Speed of Trust. If you’re working in a trusting environment, then things will go much better.

At this particular time of coronavirus, we’re working in a very fearful environment and that’s where a trusting team benefits by the speed of trust. A lot of unknowns are being faced by people operating communities like ours and across the country.

Our Nexus program has really changed the shape of what can be for people with memory impairing diseases.

The third thing that comes to mind is our Nexus program. Our Nexus program has really changed the shape of what life can be for people with memory impairing diseases. It is a program that has proven that you can slow up the progression of memory impairing disease and actually improve cognition for many, many people in the early stage of the disease process. There’s a cognition test, Mini-Mental State Exam, otherwise known as MMSE, and that is measured on a 1 to 30 point scale with one being the lowest functional level of cognition and 30 being the highest, or what would be considered normal.

Anyone can see somebody scoring a 15 or lower is a person with dementia. When you move into the 20-plus level, it’s very, very hard to see that the person has dementia.

We’re talking about the early-stage individuals. This was led by Kim Butrum, Silverado’s Senior VP of Healthcare Services and Kathy Green. Michelle Egerer and others have been very important in its implementation and success.

What it has shown over five years time we have been collecting this data — and we’ve actually given our data to the University of California, San Diego psychiatry and geriatrics departments to analyze, on 730 cases of Silverado residents at a 20-plus MMSE scale — is a mean improvement of 3.6 points. This has an average of 3.6 points improvement on cognition, which is just unheard of.

The median improvement is 3.0. The conclusion of the analysis of the data from UC San Diego is people entering the Silverado Nexus program have a 60% improvement in cognition compared to those who don’t. That’s huge.

The time that it continues benefiting someone is longer generally than Aricept or other medications, by far.

We’ll take the most complex difficult cases, being the first referral party of choice for behavioral health centers. We’re first pick for the NFL for retired players that have a memory impairment challenge, for example. We also will take people from our colleagues in the field that have someone with memory impairment that is more of a challenge for them than they want. We’ll take the most difficult cases.

In that, we’ve got an emergency room transfer rate company-wide running at 3.6%. That would compare to nursing homes around 11.9% and in assisted-living over 25%, depending on where you look at the information. When you look at the percent of acute hospitalizations, it’s at 3.4% for Silverado compared to over 20% for the nursing home and assisted living industries, again from those other data sources.

If you look at people receiving hospice at the end of life, we are right at 86% and the nursing home industry is running at about 33%. Those are the actual results from years of data. We’ve got 35 total measures. I’m not going to go through all of them, of course, but the impact and the meaningfulness of that structure has made a big difference in the quality of life for people.

What’s an example of an intervention or a program that Nexus offers that helps drive these outcomes?

There are five key pillars of the Nexus program that are meaningful: purposeful social activities, stress reduction, cognitive exercises, physical exercise, and support groups. It’s very, very important for people to have purposeful social activities, giving them a purpose and connecting with their purpose in life.

For some people, it would be volunteering or doing something outside. We had one retired NFL player, for example, that really enjoyed speaking in public and motivating kids, sports teams, churches and a variety of things.

Nobody knows he lives at Silverado or has a memory impairment. The Nexus program’s geared for higher functioning people and purpose is something we put together as a foundational zone for Silverado’s philosophy of programming from day one as it is foundational for the improvement in the quality of life for all people with a memory impairment.

Support groups are another important item and I don’t know really anyone else in the industry providing support groups, which are led by a master’s level social worker. It’s essentially group therapy for people with memory impairment. Our team produced a study, presented it at the International Alzheimer’s Disease conference a number of years ago, which showed that the results from the support group improved people’s mood and outlook and it also increased their socialization.

People, especially with the early stages of the disease, have a lot of fear and concern about the process that’s happening, and they are aware of what’s going on. To be able to express that seems like a no-brainer when we’re talking about it. Prior to our Nexus program, we were not doing that.

Can you talk about a time that you tried to create a change and it didn’t go well, and what you learned from that experience?

We felt Parkinson’s was a unique disease that really could benefit from a deep dive into what would make a difference for people with the disease. Depending on the stage of the disease, we thought maybe there was some different programming that could be impactful. We knew the importance of getting medications within a certain window of time to the person, as well as a variety of physical exercise and stimulation that can help.

Taking what’s known and then really putting it together in a comprehensive program, we felt we could do quite a bit for people with Parkinson’s. We felt we could make a difference in their quality life, progression of the disease, and the clinical results. After studying it, we put together a pretty comprehensive review, then studied the market and launched the program. We got terrific clinical results. We rolled it out in Houston and we rolled it out in Chicago and tested in those two markets. We were working with some of the top clinicians in those markets.

They were really, really impressed and thought it was great. The families and the people engaged in the Parkinson program were very pleased with it, but it never developed into a program of substance to be sustainable as a separate neighborhood within our community  that focused on Parkinson’s. We just couldn’t generate a sufficient demand to fill up a 15- to 20-bed neighborhood and provide that which we were looking for and that would be economically sustainable as a separate program. I think we missed the mark in terms of the market analysis as to the stigma of engaging in that kind of progressive Parkinson’s program in a memory care community.

People were afraid of the word memory care even though they were moving down that path. They were unwilling to access our services … The market just didn’t turn out to be there.

Do you see COVID-19 changing memory care specifically or senior living more broadly in more long-lasting ways?

I think it’s really heightened the awareness of the buyer of services from us, as to asking, what are our systems for infection control and cleanliness? What are our capabilities for understanding changes in clinical condition for people? Then what do we do, if that’s the case?

For some people, they’ll be asking, in a situation like COVID, if there is another pandemic or situation like that, and their loved one gets sick, where do they go? Do you take them back or not? What are your protocols for maintaining as safe an environment as possible, while taking care of the person who has a memory impairment who, unlike an IL or AL individual, isn’t going to be able to stay in their unit because they just simply don’t understand that and it’s not very good for them anyway?

I think it’s going to change the  perspective of referral parties. Professionals making referrals, whether they’re geriatric care managers, social workers, doctors, or others, might be a little more discerning in the capability of the operations of whom they’re sending people to. This created a huge amount of fear out there. I think people will look at other alternatives than the larger operators.

We’re going to have to be effective at making the case for them as to why that’s still a good idea.

Do you think that senior housing or memory care specifically is changing quickly enough to meet the evolving market and the challenges that are out there?

I think one of the big changes that is needed are more good options at a lower price point. That’s challenging to achieve in memory care with the high level of staffing that’s needed. I think there’s work being done in that area, and there’s more opportunity at the middle and lower price points to achieve better quality of life results. At the higher price points, people have different philosophies of how they present their programs, and an enormous strength in this industry is maintaining that ability for operators to create their own philosophy of approach and design.

By the way, that’s also a risk of COVID-19; regulatory individuals will come in, and with good intentions, tell us how to design and what to do. That hasn’t worked well in the skilled industry, it won’t work well in our industry. That is something we have got to be mindful of. Those involved in leading agencies and organizations need to  coordinate  together with our industry to avoid that risk. When we’re looking at changing fast enough and wanting to evolve with a market, that’s a big threat to being able to do that. How to guard the ability for the entrepreneurs, and the ingenious thinking that is throughout this industry on how to take care of seniors, because if we lose that ability then we will lose what’s made the whole senior housing industry succeed.

Technology is coming slowly to different levels of advantage. I see the industry adopting technologies fairly willingly as long as they work or they make sense. There’s a lot of promise and a lot of technologies that have great ambitions and aspirations that the technology just can’t yet achieve. I think it’s sorting out what’s actually working and what’s not to invest in.

Is there technology that has been really successful for Silverado or that changed the game in terms of being able to achieve all the goals that you have?

That’s a great question, and I’m hard-pressed to think of the technology that has really made a significant difference because it’s such a person-to-person level of service.

The online training is a simple technology and it’s really helpful. It’s not new for sure, but we’ve implemented our dementia certification or dementia training program, which is over a 20-hour course. There’s a test for each online module; it’s really helpful to be online. It’s not exciting new technology, but the implementation of it, and the construction of it in a more entertaining way for people to engage in that training, was useful compared to what was available elsewhere.

We’ve tried personal location devices, to know exactly where residents are, and get alerts, and different things, and it hasn’t really made a lot of difference. The technology that was available years ago, that is still helpful, is there to secure doors and prevent people from going out the wrong door. We tried specialized digital programming, and we put a lot of energy and effort over the last five years into our Nexus program, with a lot of foundational research as to what works. The Technology of digital brain games is  one pillar  of our Nexus program that we’re dropping because it doesn’t make a difference. It’s interesting. When researchers in Denmark studied our six pillars, we included it, and they didn’t implement it. It’s disappointing that that particular technology that we thought would be useful, is not.

Now, on the other hand, we’re constantly working on this stuff. There’s exciting virtual reality technology, and we’re working on studies there. I want to think that that’s going to be very impactful and useful. There is some research going on at UCI, research at the University of California, Irvine, that is studying that and identifying that it grows a certain part of the brain, the hypothalamus; it grows with a certain amount of virtual reality use. Does that work with people with dementia?

Technologies that connect families with the resident and so on, we’re all using those very effectively. Again, it’s not new technology, but it is technology and it is making a difference, especially during COVID. FaceTime, Zoom, and all those tools that aren’t new.

I imagine you work closely with so many different types of referral partners, behavioral health to hospitals, physicians. Has interoperability been a tech pain point?

That’s the challenge, the interoperability. We’ve implemented  Yardi – EHR throughout the entire company, and that’s very beneficial obviously, when you’re making the care transitions. Everyone’s working hard to do it. Then we have Homecare Homebase EHR for our hospice company, and the interoperability of these different technologies with systems for marketing and the systems relative to managing the accounting and so on which it is already is very well suited for those things.

Trying to make sure that they work most effectively and getting where we want to get to is, of course, the ongoing effort that we’re all working on, but the connectivity between the hospitals and us and the medical groups and us, that’s a great opportunity yet to be implemented, I think. There’s more to be done there.

The hospitals and the medical groups are evolving.

The hospitals and the medical groups are evolving. It’s a long process in this evolution for them to realize the value that we bring for them in improving quality of life and reducing hospitalizations and saving the system an enormous amount of money. We’ve had an analysis done of implementing our outcomes from a Medicare point of view, which if they’re implemented they save billions throughout the country. [Juniper Communities CEO] Lynne Katzmann has also done similar studies and shown similar results. The access to us in the health care systems for the services we deliver is very slow. It’s a very slow go.

There’s a lot of reasons for that, one of which is maybe the payment structures … but then you have a Kaiser, and it absolutely benefits them to work with us. We’re not top of the list even though we work with them in lots of ways. We’re not top of their lists because I think they have more pain points to address than ours at this point. It’s just frustrating that we can’t move faster on that front, but that will come. The day will come when we get to the priority that they focus on the value we bring them, but right now we’ve got a great thing to show and participate with them, and we’re not making as much headway as we’d like.

Are there changes you have yet to accomplish that you want to get done in the next couple of years? Any vision for how Silverado might be different than it is today?

I think our big focus is capital partners … two different groups of capital partners. The group we have now without a problem is the two- to four-year investors that want to turn the investment from an acquisition or a new build, and then there’s finding the right capital partner for the long-term horizon that is sustainable and predictable and we can rely on them to be there.

We have some of that in the queue. Is it a deep enough bench? It might be, but we may need to have some other resources there, too, because it may be that not every project we’re looking at in that particular batch is desirable for the capital partner to invest in on the long term.

We certainly have a lot of opportunistic acquisitions available. I think [also] great opportunities to develop new communities and continue to refine the design. We’re not going to be going for the really large operations. We won’t be doing the 165-bed memory care [community].

Every maybe five to 10 years there’s another Nexus out there. Those don’t happen often … I think there are opportunities beyond what we’re doing today, without a doubt.


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