Rod Burkett, is the Chairman of Gardant Management Solutions, an Illinois-based senior living provider.
Gardant is the 25th largest senior living operator in the country with 54 communities and over 2,300 employees.
Through the Changemaker series, Burkett talks about his background in senior living and the ways in which Gardant is advancing operations and care within its portfolio, along with finding new ways to support its employees and further efforts on expanding affordable senior living options for all.
Burkett has led the company since its founding in 1999 as BMA Management. He’s helped grow the company to also become the largest provider of affordable assisted living communities in Illinois.
Obviously, we at SHN think of you as a changemaker, but do you see yourself that way — are you always excited to drive change?
Although I think I have a very consistent personality, consistent performance. I would say over the last two decades I’ve created change. The one thing where I do feel I and our company has been a change-agent is in overcoming the stigma that utilizing HCBS and Medicaid may create substandard care. I think as a changemaker, our portfolio has proven that you can use HCBS, Medicaid waiver for assisted living, and still put a quality product in the market and be profitable to investors, or at least you can in certain states.
We like to say that we’ve really brought access to assisted living to thousands of seniors and still not sacrifice quality.
Many in our industry might have this subconscious mindset that the use of Medicaid makes it tough to offer quality services however, I’d like to highlight that 85% of our portfolio has gotten at least bronze award status and the Malcolm Baldrige Quality Award program, where we’ve had a silver quality award.
This year our whole portfolio was certified as a great place to work. The US News & World Report last year being the inaugural year of best in market in the assisted living world, I think a third of our portfolio was best in market. I think our change has been to carry that flag to say we can make it affordable, but not cut corners on quality.
What are some ways you think senior living needs to change in the next five years?
I think there’s three areas that I would mention to you, and definitely in that affordability and accessibility. We know maybe this buzzword is overused, but I’ll use the silver tsunami. The huge increase in our seniors, especially 85 and older. I think we have some pretty decent accessibility in a few states, but how many states just have very little access to lower-income seniors? Or are they restricted by only serving so many– What states are going to consider that they’re just fine with rationing care in their waiver program, and they make a waitlist. You get on a waitlist and never truly get serviced. I think what are state’s going to do with this huge access problem that’s coming up?
The difference between the haves and the have-nots, I think could really get more exacerbated if states really don’t have a good plan. The early boomers are starting to come into the sweet spot as age for assisted living. As an industry, are we truly, truly listening to what the boomer cohort is going to want? Or how do they view assisted living? I think the boomer generation is okay with congregate living, but that desire to stay active, to stay engaged right up to the very last day.
What are the more robust engagement programs to allow the boomer generation to maintain their integrity and still live in our communities, are we truly listening to what they’re needing and being empathetic about what they’re going to want to see, whether the boomer generation can afford it or not.
I think this generation to be fairly well-educated about assisted living as a consumer, they’ve been very involved in searching for their parents, aunts, and uncles. It is going to be a very demanding generation being the customer.
It’s just been very frustrating over my career in working with both state and federal regulators, whether they’re the licensing entity or in the case of Medicaid reimbursement. Either through the reimbursement side or the licensure regulatory side, it’s been rare to have collaborative relationships with these regulators. I think all the trade associations do a fabulous job of trying to create relationships and connect. If state and federal regulators would just truly collaborate and work together with the industry, I think we could accomplish so much more as compared to still keeping two sides to the table.
I know sometimes it’s hard for regulators to come out of that regulatory mindset, but as an industry, I think we’re willing to be a big part of the solution if we could just at state and federal level create collaboration and not keep our distance. I think those were the three areas.
As you look across the rest of the senior living industry, do you think that it’s changing fast enough to keep up with the times?
I think as a whole, it’s not moving fast enough. There’s the whole accessibility and affordable piece. I know you’ll probably start with that each time that we continue to carry the flag for a more accessible, affordable model. I think coming out of COVID, just the labor shortage and not having enough human resources. I think there’s no one magic solution or one magic skill still for solving that.
I think it’s a little bit of all kinds of things, but I don’t think we’re going to have enough capacity. We’re not going to have enough apartments under construction to catch up. Especially I think with rising interest rates, increasing construction costs, and the labor shortages but with the aging of our senior population, I think it’s going to be hard to catch up, and just a huge, huge need for affordable units.
Can you talk about a time when you tried to execute a change and things didn’t go according to plan? How did you pivot, and what did you learn as a leader?
Yes. The one example that really jumps out at me is maybe like a lot of management companies, as we got bigger, we added more resources. Like most companies, we have a regional approach, with regional ops, regional marketing, regional clinical, and so forth. We added all these resources as subject matter experts.
The whole intention is to create more resources, more support for our communities but I think we didn’t create clarity because where is the decision being made? Are these people that are here to help? Are they making the decision? Is the local ED making the decision? Was all with good intentions, but the unintended consequences of confusion in decision-making. We talked about empowering that decision to be made at the local level. We talked about a good game. That was the change is to not let the gray area, lack of clarity who’s truly making the decision. We talked about it, but the talk didn’t work.
I think where we failed was we didn’t truly embed that in our culture and so as we added more people, I think it just, we very often weren’t on the same team. It was them and us, corporate versus at the community level. We really had to take a step back and pivot and we truly had to embed this in our culture and it’s still a work in progress. We’ve been working at it for a couple of years.
When I’m dealing with this local community, I’m on their team and we’ve created questions that we pose to all of our staff at every staff meeting. Little wristbands that talk about being on the community team. Regardless of how I identify myself, especially what subject matter expert I am, when I’m working with that local community, I’m on their team. Not only did we talk about it, we truly had to make it embedded in our culture and have each individual talk about it and what it meant to them.
I would say that’s the one that really we spent the most energy and time truly making a change where we would create the decision-making at the local community level and have our staff truly saying, “We’re here to support you.” You’re the ones on the ground at the local community, and it’s taken a lot of effort to create that change.
How do you think about timing, so that your company can innovate without getting so far ahead of the market that a new idea doesn’t work?
Our company culture and even my own leadership style, very often we did that 20-mile march in good times, in bad times, you were still executing the 20-mile march. I have to be honest and say I don’t think our company has moved too fast in things. If anything, we were probably at fault from not moving fast enough. I will say from COVID, we did move pretty quickly there. I think we saw that, we saw the urgency to really restrict certain activities. That’s not one of our things to be cautious for.
In fact, it’s probably the opposite of you know, in some of our programming is to kind of not be so reactionary and to be more proactive so that that one’s not been something that has been a problem for us that we’ve moved too fast.
Changemakers tend to be risk-takers. Do you agree with that statement? How do you describe your own appetite for risk?
We are a for-profit company, but very mission-driven. I would say that two-third of our residents across our portfolio are subsidized by Medicaid. We’re willing to take on that risk. Building purpose-built properties that we know are going to serve a lot of moderate and low-income seniors, I think across our sector, there’s a lot of people who look upon that as quite risky.
We’re absolutely willing to take that risk and create a whole business model on it, but we think we know where it can work in calculated risk and which states that doesn’t work in.
Yes, I think that there’s been a lot of risk in creating that model. Also truly understanding what it takes to develop and operate in that affordable model really minimizes the risk, and if we limit the geography that we go in to also minimize that risk, but still be successful at it.
What is a word of advice for managing resistance to change?
I think as human beings, we have some built-in resistance to change. I think as businesses, we owe it to our customers to never become extinct. We have to change and be both proactive and reactive to all that internal and external forces that impact our business. In my mind, it is always that if the result of change is that you diminish and become extinct that sure is a big motivator for me to say, “Hey, we better be proactive and reactive to the changes that we need to do to keep carrying out our mission.”
What is the single greatest driver of change in today’s senior living operating environment?
I think it’s absolutely the staffing labor shortage, making sure we have adequate staffing. I think that that may have been exacerbated by COVID, or so many people leaving our industry and I think accelerating wage increases. I think again with the number of seniors that are going to be in our target market, and I think the younger work generation wants to know that their work makes a difference. They’re having an impact.
I think in the assisted living world, we absolutely day in, day out can show that to the younger workforce and really all age groups that their work is really making a difference in people’s lives. But our real challenge is, how do we make it cool to work in senior housing and care, how do you make that connection? I do think technology is changing a lot of things.
Can you talk about how you see the need for Diversity, Equity and Inclusion in the industry, and what you are doing to drive change in this regard?
When we have people from various backgrounds, from various cultures, from various lifestyles, when we look at our teams and we not only recognize our differences, but we highly value the differences. When we look together as a diverse team, that really brings forth the best decision-making. Not only is it the right to have diversity and allow people to truly be who they are, not only is it the right thing to do for the human soul, but it’s the right thing to do for the bottom line numbers, the economics of what we do, I think you arrive at the best decision when you have diversity and inclusion in people on team. There’s a wide variety of reasons for doing it.
We created a DEI team that is empowered beyond the normal chain of command, the normal top-down management structure. We created this team and changed how we advertise, where we advertise for open positions.
2023 is shaping up to be a year of growth and evolution for many senior living operators. In what way is your organization/company changing for the times?
Our focus really is growing our leaders and developing people. I think we’re a good company at executing on our objectives and goals, but the real test or the proof for our future is in growing and developing our people and leaders, and then those people can help exponentially grow the company. I think the time is just right to continue to develop our people with their heads up looking to the future, and growing their leadership skills that brings about the exponential increase in our performance.