Senior Living’s Evolution Shows Hospitality Is Health Care

Several recent stories on Senior Housing News have highlighted the changing way clinical services are delivered in senior living:

— Senior living health care provider EmpowerMe Wellness secured $100 million

— Five Star rebranded to AlerisLife (Nasdaq: ALR) and is pursuing a diversification strategy

— Trilogy consolidated its ancillary services under the Synchrony brand

Not only do I think that the delivery of clinical services is changing, but — based on other recent reporting and conversations I had at the ASHA conference — so too is the way that resident programming and engagement are handled.

In this week’s exclusive, members-only SHN+ Update, I analyze these trends and offer key takeaways, including:

— Integrating care and resident engagement is the future, and providers must adjust their strategies accordingly

— Senior living providers need to reconsider whether to pivot their in-house services or forge new partnerships

— The answer to the “hospitality versus health care” question is that hospitality is health care

The new clinical model

Founded in 2017 as a therapy provider for senior living communities, EmpowerMe Wellness over the last 18 months has transformed into an integrated health service company.

The concept was to integrate the “most impactful, scalable, modular” services that are delivered each day in senior living, Founder and CEO Josh Stevens told me. In addition to therapy, EmpowerMe now offers diagnostics, pharmacy and nurse practitioner-led primary care and care coordination.

Across the roughly 375 communities where EmpowerMe currently has a presence, its team members amplify the clinical presence by 120 to 150 hours per week, Stevens said.

Similarly, Synchrony combines Trilogy Health Services’ affiliated therapy, pharmacy and lab businesses under one umbrella. Trilogy founder and former CEO Randy Bufford is leading Synchrony, including a fundraising effort to support the company’s growth as a third-party service provider to other senior living organizations.

And Five Star’s rebranding as AlerisLife is meant to reflect the evolution from a typical senior living company to one that is more diversified. Already, the Ageility therapy business has been scaling quickly and thriving. Going forward, AlerisLife will look to acquire new services, grow its existing services and form new partnerships.

While these efforts are unique from each other in certain ways, I think they all represent a shift from the past.

Before, senior living providers might work with a therapy provider, a home care provider, a pharmacy and other partners, all distinct from each other. Now, these services are increasingly integrated and tied into value-based care models.

At the moment, 80% of EmpowerMe’s revenue comes through Medicare and 20% flows through reimbursement from Medicare Advantage (MA) and other commercial carriers. Stevens sees the future increasingly dominated by MA, given the growth trajectory of enrollment in MA and the increasing integration of MA in senior living.

That integration is driven by the fact that delivering more care on-site in senior living communities — and coordinating that care more closely with senior living staff and outside providers — should drive down hospitalizations and other costly interventions.

Now more than ever, providers are facing a decision about whether to partner with groups like EmpowerMe or expand their own in-house clinical capabilities. Expanding into new ancillary services is not easy or cheap, but allows senior living providers to diversify their revenue streams and — ultimately — take on risk and capture the financial upside of driving insurance savings.

Going the partnership route means that senior living providers might more quickly and easily gain benefits such as reducing staffing burdens, enhancing clinical care and extending length of stay.

But there’s a question as to whether senior living providers that opt for partnerships will ever recognize the present and future value of what they are contributing to the larger health care value equation, or will cede too much of this upside to their partners that are contracted with insurance companies or directly receiving capitated payments.

EmpowerMe’s Stevens emphasizes his own background as an operator and is adamant that providers will get a fair deal in working with his company.

“We want to help the industry … to be able to underwrite that health care risk, and participate in a way that truly provides value to the resident and to the senior living operator,” he said.

The new resident engagement approach

Technology is a key component of the integrated clinical model, with EmpowerMe taking a “data aggregation approach,” helping providers streamline data collection across their systems and EmpowerMe’s systems. The ultimate goal is to use that data in a predictive manner to maintain resident wellness — again, controlling insurance costs.

Technology is also driving a change in how resident engagement and programming occurs in senior living communities. One tech player is Cubigo; at the recent ASHA conference in Phoenix, I learned that Juniper Communities and Revel Communities are both utilizing Cubigo.

So too is Holiday Retirement, which began using Cubigo as a key part of its Holiday365 resident experience platform. The technology makes it easier for providers to gauge what residents in a particular community are interested in, connect residents who have similar interests, and make suggestions as to what upcoming programs or engagement opportunities might be appealing.

The technology also integrates with a variety of other software, including electronic health record providers PointClickCare and Yardi. Such capabilities are important, because I believe there are quickly emerging signs that the future of senior living operations lies not only in a more integrated clinical model, but in more closely integrating clinical and lifestyle services.

After all, population health efforts hinge largely on addressing social determinants of health such as nutrition and social connections, which are linked more to resident engagement than clinical care within senior living.

Juniper Communities has been a pioneer in integrated health care, with its Connect4Life model and its involvement in the Medicare Advantage plans launched by the Perennial Consortium. Now, Juniper is rolling out a new resident wellness and engagement program dubbed Catalyst. CEO Lynne Katzmann is thinking big about how to harness genomics, partner with a greater variety of community groups, and take other steps to individualize the resident experience more effectively.

And AlerisLife’s strategy is to expand into both clinical and “lifestyle” services, including those that might be delivered outside the walls of the senior living community.

The big question hovering over senior living historically has been whether the product is primarily health care or hospitality. Over and over, I’ve heard executives and other leaders say that senior living obviously is both health care and hospitality. These new approaches to clinical services and resident engagement have got me thinking in a different way: hospitality is health care.

That is, many so-called hospitality services provided by senior living providers — from facilitating social groups and outings, to salon and spa options, to simply creating a pleasant and calming environment — support resident wellbeing in important ways. So, siloing “resident engagement” from “clinical care” does not make sense, particularly in the context of value-based care.

While Connect4Life remains a best-in-class example of providing coordinated care within senior living, Katzmann now seems to be reaching toward an even more evolved operating model that further integrates the holistic resident experience.

This is a big challenge, and one that most senior living providers won’t be able to take on so comprehensively. But I think all providers need to find ways to extend their capabilities and find the right partners — with the goal being to not only better integrate the health care services that are being delivered every day in their communities, but integrate their health care with their hospitality services to maximize their impact on residents. And, ultimately, to quantify and capture the full value that they are delivering in the form of health care savings.